Online Book Reader

Home Category

The Economics of Enough_ How to Run the Economy as if the Future Matters - Diane Coyle [137]

By Root 1684 0
term, the provision of pensions, welfare benefits, and other government services will have to change. Taxpayers of the future will refuse to pay such large bills. Indeed, the crunch might come sooner than anybody imagined a short time ago: the investment funds that are among the biggest buyers in the world of government debt have indicated that it’s becoming too risky for them to continue doing so. Greece has had to have an IMF bailout already, with Portugal and Spain also seen as vulnerable to defaulting on their government bonds. Bill Gross, managing director of Pimco, one of the world’s largest bond funds, said that his firm would be a net seller of UK and U.S. government debt in 2010. He warned about the fragility of the UK government debt market, saying “the UK is a must avoid. Its gilts are resting on a bed of nitroglycerine. High debt with the potential to devalue its currency present high risks for bond investors.”14

So a reduction in deficit spending and reshaping of public expenditure patterns is essential—and probably impossible, at least within current political structures. Government services will shrink from their current high point. Human needs will not shrink, however, and indeed will probably grow in the aging Western democracies. Something will fill the needs gap, perhaps private provision, perhaps more family care, perhaps voluntary organizations, or some mix of these.

On reflection, it shouldn’t be surprising that a major restructuring of politics is necessary. The Western democracies have the political and bureaucratic structures of the mass-production hierarchical world of the late twentieth century, and that isn’t a good way to run the twenty-first century economy. All of the private sector has undergone pretty dramatic change since the 1970s crisis—companies have innovated, reengineered, delayered, globalized, and outsourced. Yet the public sector has hardly changed. To give just one—telling—example, even in the United States, which is far ahead of most other OECD countries, it is still relatively difficult to access government services online. Meanwhile, in the sixteen years or so since web browsers and HTML made the Internet accessible to people in general, giant new online businesses have emerged, much of private business has used the technologies to boost productivity and serve customers better, and other businesses that ignored the forces for change are in the throes of an extinction crisis. Yet whether in the executive, legislature, or bureaucracy, the forces resistant to reform in government have largely proven stronger than the pressures to change.

It seems likely that many government organizations will face their own version of an extinction crisis before long. With such a record of resistance to change, self-reform seems unlikely. Public sector reformers have high hopes that widespread access to broadband and social networking technologies will at last do the trick. Certainly President Obama made effective use of them in his election campaign. In the United Kingdom then-opposition leader David Cameron made much of the scope for online engagement to empower citizens.15

There is some promise in the use of online technology. From my own involvement in a public sector organization seeking greater engagement with its users, as a BBC Trustee, I know that the technologies do make it easier for users’ views to be known and taken into account, and do enforce a transparency that changes behavior. But the same experience indicates that the framework they are engaging with matters at least as much.16 In the case of the BBC there was a new governance framework for the online consultation to feed into, one explicitly intended to alter the way decisions were made, to incorporate public views into the judgments made, and thereby change the organization.

In the public sector as a whole, technology alone will not achieve much change unless the governance framework changes too. The technology offers a means of gathering directly information about what citizens think, but it’s still only a few people who

Return Main Page Previous Page Next Page

®Online Book Reader