When I was a young man, I tended to date in circles. I almost always had a girlfriend, and I generally knew who my next girlfriend would be. It was usually one of my current girlfriend’s friends. I often even knew who the girlfriend after that would be.
Writing is similar in that writing one essay often sparks the next one.
I have been accused of using Substack not just to write long-form essays, but to write chapters of a book. I have not done that in the past but it is a great idea.
Writing is as much about learning as sharing. I start out with an idea, and often learn a great deal as I research and refine it. Sometimes those essays go in unexpected directions, and often as I write one, the idea for the next emerges.
Getting married ended my dating in circles, but writing in circles continues.
Getting back to the accusation, I have not been thinking in terms of books, but it is entirely possible that I could someday put similarly themed essays together and compile them into what becomes a book, or even multiple books.
I have written a book. It is titled The Way Forward: Lean Leadership and Systems Thinking for Large and Small Businesses and is available on Amazon, Barnes & Noble, or wherever books are sold. I was originally going to title it just “The Way Forward: Lean Leadership,” but my publisher lengthened the title to perform better in search engines.
When I wrote Lean Leadership, I had two more “The Way Forward” projects in mind. One was to apply Lean Manufacturing concepts to personal life, asking questions such as, “Do my actions provide value to my friends and family?” and “What waste do my actions create in my relationships?” I was going to apply lean to every manner of how we live our lives, and if I ever write that book I will call it The Way Forward: Lean Living.
The other idea was a book with the working title The Way Forward: Lean Government.
I have not been writing chapters of a book on Substack, but doing so is a great idea, so allow me to begin fleshing out my ideas for Lean Government.
Lean Manufacturing is the systematic elimination of waste through continuous, disciplined improvement, driven by frontline problem-solving, to deliver exactly what the customer values at the lowest possible cost, in the shortest possible time, with the highest possible quality for the usage needed. One might consider it to be a scientific method of management, based on Henry Ford’s original assembly line with W. Edwards Deming thrown on top to allow product variation.
To make improvements in Lean, you start by measuring your critical measurements (usually in control charts), and then for every change you make, you monitor your critical measurements to make sure the change created a statistically significant, positive improvement. If the change does not create a statistically significant improvement, you revert back. In Lean, you only keep those changes that create statistically significant improvements.
Deming showed that 85% of managerial changes make things worse rather than better, and he said it was likely even worse in government. The idea is to eliminate the changes that don’t help.
Lean Government, then, is the systematic elimination of waste through continuous, disciplined improvement, driven by frontline problem-solving, to deliver effective governance at the lowest possible cost, with the least negative impact on the citizenry, and with the highest possible quality as the citizenry defines that term. It is a scientific method of governance.
One might ask (and in a future essay I will), “what are the critical measurements for governance?”
Can you imagine how different our country would be if the critical measurements were known and shared on control charts, with the public? Can you imagine a world where government only keeps those changes (legislation, regulations, etc.) that prove to be improvements?
The first question we might ask, when thinking about governance from a Lean Manufacturing perspective, is that of “what is a ‘government,’ and what is it for?’
The first part of that is pretty easy. My American Heritage Dictionary from 1985 (predating what I call the ‘War on Words’), defines ‘government’ as follows:
gov·ern·ment (gŭv′ərn-mənt) n.
- The act or process of governing, esp. the control and administration of public policy in a political unit.
- The office, function, or authority of one who governs or of a governing body.
- The agency or apparatus through which a governing individual or group enforces its authority and performs its functions.
- A governing body or organization.
- Those persons who comprise a governing body.
- A system or policy by which a political unit is governed.
- The management or administration of an organization, business, or institution.
- Political science.
That’s pretty straightforward, and I don’t think we’ll have a lot of disagreement on that definition. We all agree on what a government is.
I don’t think we have a lot of agreement, however, on what a government is for. This is a critical question as government is the one institution people cannot opt out of.
You can leave a bad restaurant. You can stop buying from a company that wastes your time. You can move out from under government at some levels (such as a city or state), but you cannot just walk away from a national government that wastes your money, your freedom, or your future. If any institution needs clarity of purpose, operational discipline, and a relentless focus on eliminating waste, it is government, and yet government is the last place those ideas are ever applied.
Let us work to apply those ideas, together. I mean it when I say ‘together’ too. One of the advantages of writing this book in a series of essays before converting it into chapters is that I can get feedback from those who read my essays, while I am still putting the idea together. You can reply to those essays, email me, or contact me through Substack, Facebook, or whatever – I am open to your ideas, and I may incorporate some of those ideas into the finished product.
The Purpose of Government
Let us talk about the purpose of government.
Governments are built on the assumption that more is always better. People seem to want Congress to do things, and Congress responds by writing more laws, defining more programs, creating more agencies, hiring more staff, and spending more money.
Government grows.
In the private sector, growth is constrained by market forces. If a business grows inefficiently, it fails. In government, inefficiency is rewarded with larger budgets. Every failure becomes the justification for a new initiative, and unpunished waste multiplies exponentially.
Chicago is a great example of efficiency in government. Public-sector unions, such as teachers, policemen, and firemen, negotiate contracts with people they can also give campaign donations to, and as such they have ridiculously generous pension programs in which public-sector employees often get paid more in retirement than they get paid while working.
The Illinois Constitution does not allow the government to alter pensions even in bankruptcy, meaning that Chicago has to pay every penny it owes to its public-sector retirees even before it pays for public services. To make matters worse, Chicago borrowed heavily from its pension programs to fund illegal immigrants, and now lacks the resources needed to pay its public pensions.
Chicago residents are seeing their property taxes explode to cover pension costs.
Luckily, those in Chicago and Illinois can move, but at the national level, it is hard to get out from under bad governance.
Corruption within our government is rampant at the Federal level, just as it is in Chicago. The only difference is that the Federal Government can print more money, passing its costs on to us through inflation, which it can then misreport. Inflation is a hidden tax.
When viewed from a purpose-based perspective, governments fall into three categories.
The first category includes governments designed to preserve the liberty of the people. These governments exist to protect natural rights and to prevent coercion, allowing individuals to pursue their own goals with minimal interference. Their value comes from the freedom they preserve, and their quality is measured by how effectively they maintain that freedom. Waste occurs when they restrict liberty for reasons unrelated to the protection of rights.
The second category includes governments designed to provide for the basic needs of the people. These governments see themselves as caretakers such that their purpose is to ensure the welfare and security of the people. Their value is measured in how effectively they deliver services, and their waste is measured in the inefficiencies and distortions that arise when service delivery becomes bloated or politically driven rather than responsive to citizen needs.
The third category includes governments designed to control and organize the people. These governments see citizens as resources to be managed. Their value is measured by how effectively they achieve state-defined goals, and their waste is measured in their failure to maximize compliance and output. Liberty is not part of their equation, and in this model, all human potential that goes unused, or that is used for personal rather than national purposes, is waste.
The first government was the caveman with the largest club and the most willingness to swing it at his tribe members, and as a result most governments throughout history have fallen into the third category. Government as manager and controller is the default setting of human authority. The freedom-preserving government is the exception rather than the rule, and even when governments are set up to preserve personal liberty, every instinct of government is to move beyond that. The natural tendency of power is always to grow.
A Lean Government cannot emerge without first clarifying which of these forms a society intends to build. What does the citizenry value? What constitutes quality? What is waste? The answers must be specific, measurable, and tied to purpose.
We also need to determine who defines purpose, and that changes based on the type of government used.
A government focusing on the liberty of its people allows each person to define ‘purpose’ within their daily lives. There is no larger ‘purpose’ beyond maintaining the freedom of the people to pursue ‘purpose,’ however they individually see fit.
A government acting for the welfare of the people exists to feed, clothe, house, and otherwise take care of the citizens. This might look something like what Bernie Sanders, Alexandria Ocasio-Cortez, and Zohran Mamdani promise.
Governments that exist to control and manage the population define purpose for that population, and then organize the people around that purpose, whatever that purpose may be. Historically, that purpose has tended toward empire, with the building of pyramids, ‘Cultural Palaces,’ or other giant structures to demonstrate to the citizenry how great the society is.
I find this to be a very dangerous form of government, as it is easier to build some giant structure to demonstrate to the people how great the society is, than it is to feed and shelter the people within the society. It is in fact the need to demonstrate greatness to a starving people that leads to pyramid-building in the first place.
We do this ourselves. The purpose of putting a man on the moon was to show the people how great we are. We spent over a half a trillion dollars on that project (adjusted for inflation), and in return we got velcro and Tang.
We will never know what inventions we might have had, had we kept that half a trillion dollars in private hands, but Elon Musk has shown that private hands can get into space for a lot less money than NASA.
Governments are notorious for defining “quality” for themselves. They set their own metrics, judge their own performance, and declare success regardless of what the public experiences. Lean forbids that. Lean demands that value be defined by the customer. Lean Government must therefore define value as the citizenry defines it, rather than as political actors or bureaucratic institutions prefer it to be defined.
Lean would have given us more than Tang and velcro.
Lean Government is not a utopian project, and it is not a call for perfection. It is about direction, building systems that improve over time rather than decay, and it is about teaching people to see waste so we can align institutions with purpose beyond political positioning.
Government isn’t going away, so if it’s going to take our money, it should use it wisely. If it’s going to regulate our lives, it should do so with competence and restraint.
Who is the Customer?
Lean Government begins with the simple realization that either the citizen is the customer of the government, or the government is the customer of the citizenry. Everything else naturally follows from there.
We all think, of course, that the citizen is the customer of the government, but is that really true? Perhaps it was closer to the mark in 1790, but even then one of the first things George Washington did was to tax the manufacture of whiskey. President Washington was the largest producer of whiskey in the country at the time, and in true government fashion, he exempted his own whiskey from the tax, giving himself a leg up on the competition.
This sparked what became known as the Whiskey Rebellion, which Washington put down by force. Other whiskey producers were so outraged that they relocated to the other side of the Appalachian Mountains, where the Federal Government had far less reach, and produced whiskey illegally, giving rise to moonshine and eventually NASCAR. To this day, Tennessee and Kentucky are the whiskey capitals of our country.
Thomas Jefferson had Congress sell him a large amount of swampland at the border of Virginia and Maryland for pennies on the dollar, and then, as portrayed in the musical Hamilton, Congress bought that land back from Jefferson for dollars on the penny, to make our nation’s capital. This is what Jefferson negotiated with Alexander Hamilton in the song, “In the Room Where it Happens.”
Thomas Jefferson and George Washington also did very good things, but their examples show how power corrupts, and however badly we may want to pretend that it is possible to build a perfect society, it is impossible. Power will always corrupt.
Another hard truth is that whatever purpose we may want of government, everyone actually in it wants the government to be the provider of things, at least for themselves. George Washington and Thomas Jefferson used the government to enrich themselves, and so too have the vast majority of others in government.
If we look for the purpose of government based upon what government actually does, then the purpose is to gain campaign funding by benefitting potential campaign donors, with the public footing the bill. The government exists to enrich those in it, along with those who fund their elections, while separating the people from both their income as well as from the actual exercise of power.
The government is the only body in the world that can be bribed with its own money, and we, of course, foot the bill.
We are not the customers. We are the suppliers, and our relationship with government is one where the customer can take whatever it wants, whenever it wants, with no regard for us. This is why our youth feel like society is broken – because it is. We need to illustrate a better way forward.
Government Does Not Care What You Think
If the purpose of government is unclear, or worse, if the government serves its own internal incentives rather than the citizenry, then any attempt at improvement is impossible. Lean begins with defining value from the customer’s perspective. In government, that requires confronting the uncomfortable truth that the government truly does see itself as the customer, rather than the citizen.
Martin Gilens and Benjamin I. Page did a study titled “Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens” that found zero correlation between the public popularity of a given policy proposal, and the likelihood that a policy would be enacted. There was a weak correlation if only rich people were looked at, and a much stronger correlation to the needs of elite institutions and corporations, along with special interest groups. Their summary said, “The preferences of the average American appear to have only a minuscule, near-zero, statistically non-significant impact upon public policy.”
Clearly then, the purpose of our government is to organize and manage the public (and their money) in the interest of those running the government, and in the interest of those who can do things for the people running the government. That may not be the purpose we want, but that is the purpose we have, and when measured by that purpose our government is surprisingly efficient.
I’m going to give ten specific examples of things where what the public broadly wants is known, and where the government does not take what the public wants into account at all. For the record, I do not personally agree with the general public on all of these things (I do agree on some), but my personal views are not relevant in illustrating how little the government cares what we think or want.
During the financial crisis, the public overwhelmingly wanted help for homeowners, not Wall Street. Polls at the time showed strong support for direct mortgage relief and skepticism toward bailing out the banks that helped cause the collapse. Policy went almost entirely in the opposite direction.
TARP and the Federal Reserve’s emergency programs funneled vast resources into stabilizing major financial institutions, while HAMP, the program sold as homeowner relief, was designed mainly to slow the rate of foreclosures so banks could unwind bad assets more gently. Treasury officials later admitted that HAMP’s real function was to “foam the runway” for the banks, not to help families keep their homes.
We bailed out the people who caused the crisis, at the expense of the people they hurt. We’ve been printing money ever since. People blame the ‘democrats,’ or the ‘republicans’ for inflation, but there is plenty of blame to go around.
For at least twenty years, somewhere between 75 and 90 percent of Americans have supported allowing Medicare to negotiate prescription drug prices. This is not a partisan issue. Republicans, Democrats, and independents all consistently endorse it, and yet Congress refused to act year after year because the pharmaceutical lobby, the most powerful and best-funded lobbying force in Washington, made sure the idea never gained traction.
Only in 2022 did a narrow, heavily diluted version pass, and even that involved an exhausting political struggle that included having the government pay for Covid vaccines, at taxpayer expense, forever. The result illustrates the core dynamic Gilens and Page identified: broad public support means almost nothing if powerful industries oppose the reform.
A solid majority of Americans, across ideological lines, favor limiting or ending qualified immunity when police officers engage in clear misconduct. This is one of the few issues where libertarians, civil-rights advocates, and many conservatives actually agree. Congress refuses to touch it.
Police unions, municipal insurers, and law-enforcement lobbying groups have far more influence over policymakers than the general public does. These institutions argue that reform would increase liability costs or reduce officer recruitment, and lawmakers reliably fall in line. The public wants accountability. The institutional forces want protection. Government takes the side of the institutions every time.
Term limits are one of the most consistently popular political reforms in the United States. Depending on the poll, between 80 and 85 percent of the public favors them. This level of agreement is almost unheard of.
If public opinion mattered, term limits would have been enacted decades ago. Instead, they never even make it out of committee. Members of Congress have no incentive to reduce their own power, influence, or long-term earning potential, so despite overwhelming public demand, nothing happens. It is difficult to find a clearer demonstration that government responds to its own internal incentives rather than to the will of the people.
Year after year, Americans across party lines support closing corporate tax loopholes and ensuring that large multinational corporations pay something closer to their nominal tax rate. This is especially true of loopholes involving offshore profits and tax havens.
Those loopholes remain remarkably durable. Corporate lobbyists and financial institutions spend enormous sums to preserve the existing structure. Lawmakers from both parties receive donations from the industries that benefit from these loopholes, and as a result, reform proposals quietly die before reaching a vote. The public wants fairness. Corporations want to keep their advantages. Government sides with the corporations.
Foreign policy may be the starkest example of the disconnect between the public and the government. After the first few months of any major intervention, Americans consistently turn against prolonged military deployments. This happened in Iraq and Afghanistan over and over again, yet the United States stayed in both countries for nearly twenty years.
Defense contractors, intelligence agencies, and foreign-policy institutions, collectively known as “the Blob,” had strong incentives to maintain the interventions. Contracts, budgets, institutional prestige, and career pathways all depended on keeping the missions going. Public opposition barely registered. Institutional momentum carried the day, and American servicepeople died to forward careers.
For many years, polls showed that 80 to 90 percent of Americans supported clear labeling of genetically modified foods. Whether one sees that concern as scientifically justified or not, the public preference was unequivocal. When several states passed strong labeling laws, major agricultural corporations and lobbying groups pressured Congress to intervene.
Congress responded with federal legislation that pre-empted the state laws and replaced them with a weak, QR-code-based requirement that few consumers use and many cannot even access. The outcome served industry interests perfectly while ignoring what the public had overwhelmingly said it wanted.
Net neutrality enjoyed broad, bipartisan public support. Voters understood that internet service providers should not be allowed to throttle or prioritize content based on payment or political preference.
In 2017, the FCC repealed net neutrality protections despite a public comment period showing overwhelming opposition. Investigations later revealed that industry groups had flooded the system with fraudulent comments to skew the appearance of support. The telecommunications industry got what it wanted because it had institutional leverage and the public did not.
Civil asset forfeiture is one of the most unpopular law-enforcement practices in the country. Large majorities of Americans believe it is abusive and violates basic principles of due process, and yet it persists nationwide.
The reason is simple: law enforcement agencies directly profit from seized assets. This creates a financial incentive for police departments and prosecutors to lobby fiercely to protect the practice. As long as agencies can treat forfeiture revenue as part of their budget, reform efforts will continue to fail, no matter how many voters oppose the system.
Civil asset forfeiture is particularly troubling as the burden of proof flips. If the police take your property, you have to prove that you did not use illegal funds to buy it, or did not use it to commit any crimes. It is almost impossible to disprove a negative, and as such if the police take your property, it is very difficult to get it back. This includes your home.
Immigration policy is another area where public opinion has been remarkably consistent and remarkably ignored. For decades, Americans have favored reducing illegal immigration, improving border enforcement, and tightening employment verification. Congress has repeatedly failed to implement any of these reforms, and other than Donald Trump, Presidents have refused to enforce federal law. Joe Biden had the border wide open for four years, and some estimates say as many as thirty million people entered the country illegally, pushing the costs of everything from housing to food through the stratosphere.
Businesses that benefit from cheap labor, activist nonprofits, globalist policy groups, and political strategists all have strong incentives to maintain the current dysfunction. The public wants a stable, coherent system. The institutions benefiting from the chaos do not. Government sides with the institutions, and even when a President does what the public broadly wants, the institutions attack him for it.
Nobody cares what you or I think.
Government Value and Quality
Article One, Section 8 of the United States Constitution gives us a good baseline for ‘value’ in terms of government. I don’t think anyone would disagree that the government should do the things listed. If we differ, it is that many want the government to do more than this, so in terms of value let’s start with where the public largely agrees.
Section 8 starts out with the power to tax, and a preamble, listing a summary of the purposes behind taxation. Specifically, it says Congress can pay government debts, provide for the common defense, and provide for the general welfare:
8.1 The Congress shall have Power to lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defense and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;
These three summarized powers are then defined in detail below. As you read, note that some powers clearly relate to the common defense, others to paying debts, and the rest to what the Constitution means by ‘provide for the general welfare’. The ‘powers’ listed in 8.1 are not enumerated powers in 8.1, but only as defined below.
8.2 To borrow Money on the credit of the United States;
8.3 To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;
8.4 To establish a uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies throughout the United States;
8.5 To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;
8.6 To provide for the Punishment of counterfeiting the Securities and current Coin of the United States;
8.7 To establish Post Offices and post Roads;
8.8 To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;
8.9 To constitute Tribunals inferior to the Supreme Court;
8.10 To define and punish Piracies and Felonies committed on the high Seas, and Offenses against the Law of Nations;
8.11 To declare War, grant Letters of Marque and Reprisal, and make Rules concerning Captures on Land and Water;
8.12 To raise and support Armies, but no Appropriation of Money to that Use shall be for a longer Term than two Years;
8.13 To provide and maintain a Navy;
8.14 To make Rules for the Government and Regulation of the land and naval Forces;
8.15 To provide for calling forth the Militia to execute the Laws of the Union, suppress Insurrections and repel Invasions;
8.16 To provide for organizing, arming, and disciplining, the Militia, and for governing such Part of them as may be employed in the Service of the United States, reserving to the States respectively, the Appointment of the Officers, and the Authority of training the Militia according to the discipline prescribed by Congress;
8.17 To exercise exclusive Legislation in all Cases whatsoever, over such District (not exceeding ten Miles square) as may, by Cession of particular States, and the Acceptance of Congress, become the Seat of the Government of the United States, and to exercise like Authority over all Places purchased by the Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts, Magazines, Arsenals, dockyards, and other needful Buildings;–And
8.18 To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.
Just to be even more clear that this list – 8.2 to 8.18 – is the ENTIRE list of federal legislative power, the founders then wrote the 10th Amendment:
The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.
Note that the Constitution does NOT say government cannot do more than what is listed in Article 1, 8.2-8.18. It merely says that the FEDERAL government cannot do more than that.
This opens another discussion about the level of government in which power should be exercised. I already covered the concept of federalism in a previous article, so I won’t go into detail here. Suffice it to say that power becomes more responsive to the people as it becomes more local, and less responsive as it becomes more centralized.
The most local level of government possible is the individual (or the individual family unit), and we are of course highly responsive to our own needs. A housing association will be less responsive to the needs of each individual homeowner, but will be far more responsive to the needs and wishes of a neighborhood than will be a city mayor. The city government is more in tune with the needs and wishes of those in a city than is the state governor, and of course the state government is far more responsive to the people of a given state than is the President, or Congress.
I don’t have time in an introductory essay to go into a lot of detail on the value of government at all of the different levels possible (that will be a separate essay), but suffice it to say that a Lean Government will want as much done as practical at the lowest level possible.
As for quality, that too will require a chapter of its own. For now, suffice it to say that the government should be able to do its enumerated powers well, with minimal (ideally no) waste.
Waste in Government
Let’s talk about waste.
Much of the public wants the government to be, to at least some degree, the provider of things, but it is important to note that for the government to be the provider of things it must also be the taker of things, as without taking, the government has nothing to provide.
I like to ask those who want the government to take care of people, to think about it in terms of Karl Marx’s position on the value of labor. To Marx, all of the value labor adds to an item should go to the laborers producing it, making profit a form of theft.
The government adds no value to any good or service. All it can do is to change who gets a good or service, or force those who produce things to change the nature or price of the goods and services produced.
If profit is theft, then how are costs associated with the taking of property from some to provide it to others, not also theft? If the government taxes me to pay someone of less means, do either I or the person getting my money have any idea what percentage of the money taken from me, actually goes to the recipient?
For the record, profit is not theft. Profit is what the business owner gets for risking his money and reputation on an idea, and for forming a company around it. Unlike government, a business owner faces consequences for getting things wrong, but government suffers no consequences, so the question of where the money goes when the government takes it remains. What percent goes to the supposed recipients?
The honest answer is that neither the taxpayer nor the recipient has any idea what percentage of a taxed dollar actually reaches the person it is supposedly meant to help, and that ignorance is built into the structure of the system. Government redistribution is not a transfer. It is a process, and that process consumes resources at every step.
Between the moment money leaves your pocket and the moment a fraction of it lands in the hands of a beneficiary, it passes through the IRS, the Treasury Department, federal agencies, state agencies, compliance departments, auditors, inspectors, contractors, subcontractors, and entire bureaucratic layers devoted to both preventing and processing fraud. Every one of those layers keeps a slice.
Administrative overhead alone is enormous. Even the “efficient” programs would be considered catastrophically wasteful by private-sector standards. Medicaid loses between twenty-five and forty percent of its funding to administrative overhead and fraud. TANF, in some states, delivers as little as twenty-four cents on the dollar to the poor. Housing assistance programs routinely spend more than thirty percent of their budgets on administration. Food aid programs, including SNAP and WIC, consume thirty to fifty percent of their funds to overhead, compliance costs, and retailer markups before any food reaches a household.
There is not a single federal program where a tax dollar becomes a full dollar of benefit. Not one.
The reason for this inefficiency is simple: bureaucracies have no incentive structure that rewards efficiency. A government agency does not profit by delivering more benefit with fewer resources. It profits by expanding itself, with more staff, more budget, more oversight authority, and more justification for continued appropriations.
In the private sector, waste destroys an organization. In government, waste is the justification for next year’s funding request. The bureaucracy, by its nature, grows thicker over time.
Recipients have no way to know how much money is extracted from taxpayers or how much of that money is consumed by the process of redistribution. They only see the final amount deposited on a card or delivered through a program.
The taxpayer has no way to know either, because Congress does not report the percentage of tax revenue that actually reaches its intended destination. If a private charity behaved in this way, refusing to disclose costs, losses, and overhead, it would be accused of fraud. In government, this opacity is normal.
In real terms, depending on the program, the amount that reaches the intended beneficiary can range from as much as sixty cents on the dollar to as little as twenty cents. International aid programs sometimes deliver less than ten cents. The rest is absorbed by the machinery.
The precise answer to the question is that the government does not want us to know how much of what it takes to support people is wasted. If people understood how much disappears into the process, the illusion that government is a provider of things, rather than a consumer, would vanish overnight.
That also means the majority, and perhaps the vast majority of what the government taxes is waste, by any rational measure.
Public vs. Private Incentives
One of the most important differences between government and the private sector is the nature of their incentives. In the private sector, an organization that wastes resources eventually fails. A business that produces a bad product, charges too much, mistreats its customers, or operates inefficiently will lose market share to competitors. Companies must get better over time because their survival depends on their ability to create value as their customers define it. Waste is punished while efficiency is rewarded. Success requires alignment with the wants and needs of the people being served.
Government operates under the opposite set of incentives. A government agency that wastes resources is not punished with bankruptcy. It is rewarded with a larger budget.
When a government program fails, the failure is used to justify expanding the program, adding more staff, and increasing funding “to fix the problem.” Bureaucratic inefficiency becomes evidence that the bureaucracy needs to grow. Waste is not penalized. It is reinforced. No matter how poorly a government agency performs, the taxpayer is compelled to fund it anyway.
In the private sector, the feedback loop is immediate and unavoidable. If a business provides poor service, customers leave. If a company misuses its resources, investors retreat. If a product fails, the market rejects it.
Government has no comparable feedback loop. Citizens cannot simply choose a different bureaucratic agency the way they can choose a different grocery store. They cannot opt out of paying taxes to departments that serve them poorly. Elections theoretically serve as a feedback mechanism, but they occur years apart, are influenced by factors unrelated to performance, and rarely result in entrenched bureaucracies being dismantled or reformed. The bureaucracy remains, regardless of who holds office.
As discussed earlier, nobody in government cares what you or I think.
Private institutions survive by improving their value stream. Public institutions survive by expanding their authority.
In business, growth is earned. In government, growth is assumed. Government agencies measure success not by how well they serve the public, but by how much jurisdiction they can claim, how large a budget they can secure, and how many employees report to them. These internal metrics have nothing to do with public value and everything to do with institutional self-preservation.
A government agency is not incentivized to solve problems. Solving problems reduces the need for the agency.
This asymmetry of incentives is the root of nearly all government waste. It explains why programs grow without regard to effectiveness, why laws accumulate without review, why regulations pile up without repeal, and why bureaucratic layers become thicker rather than thinner over time. When the private sector fails, it disappears. When the government fails, it expands. As long as this incentive structure persists, waste is not an aberration. It is the expected outcome.
Conclusion
The picture that emerges is not flattering. Our government does not see the citizen as the customer. It sees the citizen as the resource. It exists to tax, regulate, and manage the public in the interests of those who run it and those who can do things for the people who run it. That is not the purpose many of us would choose, yet when you look at what government actually does, it is the purpose that best fits the facts.
Measured against its current purpose, government is highly efficient. Measured against the purpose it is supposed to serve, it is an abject failure.
Lean thinking refuses to accept that kind of drift.
In manufacturing, the first step is to define value from the customer’s perspective, and then to identify every place the system adds cost without adding value. Government is full of such places. At the federal level it takes far more than it needs to perform the limited functions the Constitution assigns to it, inserting itself into domains that do not belong to it, and in many cases at the state and local level, government can be even worse, operating under the assumption that the next level up can always bail it out.
Government rewards those inside the system while obscuring the true cost to those on the outside. If we applied even a fraction of the discipline we expect from private firms to the public sector, much of what government does would go away.
I am not pretending that one essay, or even one book, will turn Washington into a model of Lean efficiency. That is not how this works. What we can do is to begin thinking about government the way we already think about successful organizations in every other area of life.
We can ask what value looks like from the citizen’s point of view. We can ask what quality looks like when the goal is liberty rather than control. We can ask what work must be done at the federal level, what should be done closer to home, and what should not be done by government at all. Those are Lean questions, and they are long overdue.
When I say I am writing a book as a series of essays, I mean that in a literal sense. I am learning as I go. I am testing ideas, refining them, and seeing where they lead. If these essays ever do become a book, it will be because enough people found the questions worth asking and were willing to think through the answers with me.
I don’t have to have all the answers myself, but Substack is a community. We can converse to share ideas and come up with new ways of thinking about the relationship between the governed and the governing body.
For now, I will leave you with this: we have a government that cannot be opted out of and that currently serves itself more faithfully than it serves us. If government is going to exist, it ought to work. If it is going to spend, it ought to spend well. If it is going to regulate, it ought to regulate with care. Lean Government begins with the simple recognition that the citizen is supposed to be the customer, and in the essays that follow, I intend to ask what it would take to make that statement a reality.
When I write essays in this series, I’ll start the title with ‘Lean Government’ so you’ll know it is a part.
