By Douglas Kruger
OVER the past few years, Jersey Business has been tracking our island’s productivity. We’re lagging. Our levels have actually declined over the past two decades, and though the same is true of the UK in comparison to developed nations, ours is worse.
I write and speak on the topic of strategic rule-breaking, in the interests of freedom and faster moving economies, and a lifelong Jersey resident reached out to me for a chat on the topic. His insights were fascinating.
We both feel that it takes too long, and too many permits, to do useful work on the Island. Every new rule imposed on an economy implies a cost, in time, in money, and in opportunity lost. It also imposes a form of cultural conditioning, by which high-value, radical go-getters become frustrated and leave, draining us of talent, while those who are willing to passively accept burgeoning bureaucracy remain. That’s not the kind of attrition we want.
So I asked: “Why do you suppose we tolerate it? Especially on an island so small? If the rules are getting in our way, why do they keep growing, and why do we allow it?”
His take was: “Because government keeps growing.” Makes sense.
But he went further than that: “Decades back, you had business people and farmers working for free in government. These were people who knew what needed to be done, and so everything they did at governmental level enabled the success of the Island. Then we started paying government. But not enough. You either want them working for free, in which case you attract idealistic input, or you want them working for top-level salaries, in which case you attract proven talent, folks who have previously been directors and chief executives.”
That cast a great deal of light on the situation for me. But he wasn’t done.
“Now imagine that you are a mid-level bureaucrat. You’re not there out of idealism, and you’re not there because you are the best. And you discover that your salary band is determined by how many minions you have working under you. The more rules you add, and the more enforcement required, the more your take-home salary. Sure, it slows everything down. And makes everything worse, stupider and more expensive. You introduce paralysis to the system. But you, personally, get wealthier.”
It’s a frightening thought. Are we incentivising government to punish us more? With our own tax money?
If so, there is a solution. We need to reverse that dynamic. Instead of higher pay for punitive measures, we need to so structure our government-incentives that politicians are rewarded for what they enable.
Take a simple example. We don’t have enough parking. And so we have government employees who go around handing out fines to people who park. This brings in revenue. And the more people you have fining the public, the higher your salary band.
That’s a dreadful set-up.
What if we scrapped parking fines? And then rewarded anyone who successfully introduces a way to enable more parking? Now your incentives are working in the right direction, to wit: in the public interest, rather than as a mechanism of punishment.
Economic historian Dr Thomas Sowell observed: “You will never understand bureaucracies until you understand that, for bureaucrats, procedure is everything, and outcome is nothing.”
Left to run their courses, human systems never spontaneously reduce themselves. Instead, they become more complex over time. That conversation helped to explain why. They have every incentive to do so.
Even when they aren’t rewarded with money, people who gravitate to these positions can be notoriously unable to perceive how the burden they impose might ever be reduced. They come to believe that the rules, of which they are custodians, are more important than the goals. Unless we push back, the inevitable outcome is a sort of cryogenic freezing. We’re already behind in the productivity stakes, so perhaps it’s time to push a great deal harder.
When rules become excessive, they can and should be challenged. When you challenge them, you may discover that the original purpose of the rule has long since disappeared. The rule only continues to operate through blind momentum, and not for any useful or intelligent reason.
My new friend had one more bombshell to drop.
“We’ve become culturally conditioned to police one another, to such a point that any one person who tries to reduce rules faces reputational backlash. Imagine, for instance, that you are a fire warden. You know which rules are critical. And you know which additional rules are pure theatre. They add nothing, do nothing, save no one, but simply add cost and burden. If you try to strip them away, the very next day, the media will be screaming, ‘Fire warden wants everyone dead!’”
I laughed at that. But he didn’t. He really meant it.
So perhaps the solution begins with public sentiment. And perhaps the media has a role to play in that. Do the news outlets in Jersey need to be brought onboard to a nationwide “freedom initiative”, before such reforms are even attempted? Their proffered support, rather than active demonising, might make all the difference.
Either way, I believe we’re beginning to circle the problem. We all know something’s wrong. Costs are too high, things move too slowly, nothing useful can be done with any degree of ease. If we’re moving a little closer to defining the problem, we might also be approaching hatchet time. A grand clearing away of the debris that strangles the system.
Can you just imagine what fresh air might feel like to our economy?
Douglas Kruger is a professional speaker on the business circuit, and the author of books like, ‘They’re Your Rules, Break Them!’ His books are available via Amazon and Audible.
