Better Government Doesn’t Mean Bigger Government

By Chris Yiu

The pandemic has confirmed two truths about the role of the state in the 21st century: Government matters and government is broken.

A relentless global health emergency has shown clearly why government matters. From the support for basic science that underpinned the development of new vaccines and therapeutics, through to public health measures required to counter the threat of a highly infectious pathogen, public policy has been critical to bringing the crisis under control. However, the last 18 months have also exposed just how great a mismatch there now is between industrial-era structures of government and our internet-era societies.

By and large, rich countries were late to lock down, clumsy at contact tracing and isolation, and slow to mobilize once vaccines were available. Some of these shortcomings are perhaps understandable, given the unprecedented situation our leaders found themselves in. The bigger issue, and the one that will be with us long after the immediate crisis passes, is what it has exposed about business-as-usual.

Most of our public services managed to migrate online when countries were sent into lockdown—doctors did patient consultations over the phone, schools moved lessons from classrooms to video calls, application forms for licenses and public benefits moved from paper to the web. People have rightly hailed this adaptation as a huge success, and correctly observed that had the pandemic arrived 10 years earlier, things would have played out very differently.

But it shouldn’t have taken a crisis to force this sort of change. The World Wide Web was invented in 1989, and the internet and smartphone revolution emanating from Silicon Valley took off in the early 2000s. Two decades into the 21st century, digital government and digital public services should by rights be thriving.

The Old Model

The model of government we are familiar with is an artifact of the industrial era—a time defined by scarcity that therefore forced governments to balance a number of difficult tradeoffs. In front-line public services like healthcare and education, the Industrial Revolution catalyzed huge leaps in countries’ ability to provide basic foundations and safety nets for their citizens. The price of universality was uniformity—a place in school for every child was attainable, but a personal tutor for every child remained far beyond reach, save for the most privileged.

At a macroeconomic level, governments faced the inexorable tradeoff familiar to every graduate of Econ 101: equity or efficiency. Pursuing more aggressive distributional goals typically meant expanding the size of the state, with an associated reduction in productive efficiency in the wider economy.

And in our deliberative and democratic processes we seemed capable of either speed or wisdom, but rarely both (and sometimes neither, sadly). Governments that tried to consider issues carefully and consult widely typically took years to make progress, with external events easily outpacing new policies. Governments that tried to move quickly often did so clumsily and risked embarrassing failures and U-turns after acting with incomplete situational awareness.

This reality held together for much of the 20th century. Different administrations in different countries chose different stances in relation to these tradeoffs, but all had to confront them. The public, for its part, largely accepted this as the natural order of things. But by the turn of the millennium it was clear that something big had started to shift.

A New Paradigm

The foundations of the internet era are software, data and networks. These digital building blocks are non-rival and therefore defined not by scarcity, but by abundance, and this in turn renders lots of the old tradeoffs around government obsolete.

Public service providers can increase quality and lower their costs at the same time using digital channels, which are simultaneously more convenient for citizens and less expensive than face-to-face, telephone or postal transactions. And when personalization is managed in software, universal services and tailored services can coexist without the cost becoming prohibitive.

We are just at the start of this journey of mass personalization. Search engines, social media feeds and online marketplaces that operate at huge scale while also being tailored to our individual needs and preferences are already familiar. In public services, developments in personalized learning (where learning activities are tailored for students, not classes) and healthcare (driven by data, wearables and machine learning) hint at the potential for change in the years ahead.

Digital platforms and marketplaces also provide new models for achieving a government’s distributional goals without having to resort to the state as the primary producer of public services. Whereas in a world of scarcity it often made sense for the state to carry out certain functions, in a world of abundance we can more easily conceive of government as a platform on which services are delivered by whatever entity—public, private, social enterprise—is best able to meet the needs of citizens.

And by taking advantage of technology to break the old constraints on public engagement, government can move faster without sacrificing the wisdom that comes from listening to different perspectives. Ad-hoc focus groups and bilateral consultations can be replaced by continuous listening and consensus building at scale, involving the public in more meaningful ways and de-risking major policy decisions through a combination of better scrutiny and more experimentation.

All of this ought to be hugely positive in terms of governments’ ability to deliver for citizens. And yet for most countries, realizing the potential of technology to reimagine the state is still some way off.

Fighting the Status Quo

Industrial-era institutions tend not to exhibit spontaneous reform. One of the recurring themes of the internet era has been new, tech-first challengers turning over tired incumbents—leaving many of them to embark on journeys of reinvention as a last resort. The difference for government is that this sort of competitive pressure has largely been absent, and a combination of de facto monopoly position and insiders with a vested interest in the status quo has resulted in little internal impetus for change.

But as the world emerges from the pandemic, the rallying call to “Build back better” ought to apply as much to government as to the world around it. The crisis accelerated trends that were already exerting huge pressure on our economy and society—driving the adoption of new technologies, pushing economic and social interactions online, destroying old business models and catalyzing new ones. And it’s clearer than ever that state capacity matters, both to navigate the crisis and to help shape a better future after it.

So, as we move past the pandemic, better government doesn’t mean bigger government. In fact, with the technologies now at our disposal, a system fit for the 21st century will be far smaller and more agile than those that have gone before, even as government moves with greater speed and purpose. This requires leaders to overturn two long-held axioms of public sector thinking.

The first is that government must no longer be organized around the needs of the bureaucracy but instead around the needs of citizens (the users of government, in tech parlance). A digital-first approach to government is central to this—and must be supported by other reforms to promote public sector risk taking and to overhaul tired bureaucracies.

The second is that government must no longer think of itself as the provider of last resort and instead think of itself as an operator of platforms for competition and innovation. Again, a greater openness to working with the private and nonprofit sectors can help improve the delivery of services. None of this means letting go of the great traditions of public service, or the respect we have for those who dedicate their lives to serve others. Nor does it mean relaxing our commitment to equality of opportunity or our obligation to take care of those less fortunate.

But in the internet era, government should be measured not by what the state itself owns, produces and controls, but by what it makes possible. The things that only the state can provide—rule of law, taxation and redistribution, public goods, and international engagement—must now go hand in hand with new sorts of digital infrastructure that the state is best able to provide: open data, common standards, APIs for public services and marketplaces for citizen-facing service providers.

This is a very different model of the state compared to the one we are used to, and a bold articulation of the notion that less sometimes really can be more. On the road from here to there we will encounter huge resistance. The only meaningful counterweight to this is political will—to champion the needs of citizens, to prove through experimentation and practical action that better government is possible, and to face down the opponents of change in the name of bold, radical progress.

It may take a new generation of political leaders, themselves less enmeshed in the system they are trying to reform, to make these changes. They will face their own battles within established party structures, which are themselves institutions out of time. The fight will be arduous, but those who succeed will own the foreseeable political future.