A question for those who see expanding government and more government intervention as a cure for our economic ills, is the government set up to be a model of effeciency? If one looks at the incentive structure of the US government, the emphatic answer is no. In truth nearly all incentive is designed to reward those programs and departments that are least effecient. It all boils down to the way government budgets are allocated.
Say you head a certain department of government, take your pick, these departments are expanding at an exponential rate, so fast I don't even think the government truly knows how many departments are under they're control. So, you're a department head, every year you receive an operational budget to conduct whatever your department is tasked to do. Say for arguments sake your budget is $10 million, now lets assume you only need $5 million to adequately run your department. In the private industry you would be rewarded for this thriftness, why wouldn't you be, you just saved the company $5 million. Hey you might even get that promotion or a nice bonus. Unfortunately, the government works the opposite way. If you do not spend your entire budget, then the following year your budget is cut, the last thing a department head wants to have is the punishment of having their budget cut. Now if that department head spends there entire budget, they have an argument to go to the government coffers and ask for more money in next years budget.
I've spoken to many government workers over the years and all seem to relate the same story, close to the end of the fical budget year departments go on massive spending sprees to ensure they use their full allotted budget. New office furniture, regardless of the fact that the current furniture is less than a year old. New computers and software, just say all the equipment has become obsolete. The end of the fiscal budget year is like Christmas come early, if only the taxpayers knew of the looting going on at their expense.
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