Efficiency at What and for Whom?

How DOGE represents the latest chapter in the fifty year project to dismantle the state

Aug 01, 2025

This piece emerged from conversations at this year's UCL IIPP Forum, "Rethinking the State," where panel after panel returned to the same urgent question: how do we rebuild state capacity in the age of DOGE? We founded the UCL Institute for Innovation and Public Purpose to challenge how the state is imagined, practised, and evaluated—moving beyond the tired narrative of government as bureaucratic burden toward a vision of the entrepreneurial state capable of tackling societal challenges. The Forum title reflects that mission: in an era when democracy itself faces existential threats, we need fundamental rethinking, not incremental reform.

Across every session, participants grappled with what Damon Silvers, Visiting Professor of Practice in Labour Markets and Innovation at UCL IIPP, described on a panel as DOGE's attempt to transform "the neoliberal state into a predatory state, one that operates like a protection racket at a global scale." These conversations crystallised insights from more than a decade of work on the entrepreneurial state, public sector capacity, and the dangers of consulting capture—themes that run through my previous books. What follows is both summation and call to action: a synthesis of where we've been and where we must go.

You can watch all of the sessions from this year’s IIPP Forum here. Or read about some of the key themes from across this year’s sessions on UCL IIPP’s medium blog.

The question should have been obvious from the start: efficient at what, and for whom? Elon Musk's Department of Government Efficiency (DOGE) promised to slash government waste and streamline operations, but when the dust settled, DOGE had delivered precisely what critics predicted—a bonanza for corporate interests dressed up as fiscal responsibility. Now, with Trump's "Big Beautiful Bill" cutting $3.3 trillion in taxes for the wealthy whilst slashing Medicaid and food stamps for the poor, the pattern is unmistakable. As Damon Silvers warned during our recent IIPP Forum, we're witnessing the operation of a "protection racket at a global scale"—one where efficiency rhetoric serves as cover for the systematic transfer of public resources to private hands. DOGE wasn't an aberration or a failed experiment; it was the latest chapter in a fifty-year project to dismantle state capacity, and its real success lies not in any savings it claimed, but in continuing the ideological work of convincing the public that government itself is the problem.

Understanding DOGE's assault on state capacity requires grasping three interconnected dynamics that I've explored across my recent books. In The Entrepreneurial State, I argued that the state had been wrongly reduced from market shaper to market fixer—transformed from an institution that actively shaped technological development into one that merely corrects failures after private actors capture the gains. This wasn't inevitable: agencies like NASA and DARPA created what became the Internet precisely because they were given clear missions and told to "think big and take risks." The Big Con explains how this transformation was further entrenched through the systematic outsourcing of government capabilities to consulting firms, draining institutional knowledge and creating dependencies that weakened the state from within. Mission Economy reveals the historical irony: the very technological innovations that today's tech giants use to extract rents—from AI to the internet—emerged from decades of patient, high-risk public investment that private markets would never have undertaken.

Consider artificial intelligence, the very technology DOGE claimed would revolutionise government efficiency. Early developments in AI, particularly speech recognition, were powered by significant public investment through agencies like DARPA—the same type of mission-oriented institutions that DOGE sought to undermine. In the 1970s, DARPA's Speech Understanding Research programme funded pioneering work at Carnegie Mellon, MIT, and Stanford Research Institute, creating systems like CMU's 'Harpy' that achieved near-human recognition levels. Throughout the 1980s and 1990s, DARPA continued investing in language and learning technologies, laying critical groundwork for today's voice assistants. These investments built the high-risk, long-term infrastructure that private firms later capitalised on. The state didn't just fund basic research—it actively shaped the direction and pace of innovation that would only become commercially viable decades later [a history I write about in further detail in my previous post AI for What?]

AI for What?

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Yet DOGE's cuts targeted precisely these types of long-term research capabilities, representing a form of institutional vandalism that destroys the foundations of future innovation.

The Long Arc of Reduced State Capacity

The process that reached its latest expression with DOGE began with the ascendancy of neoliberal economic thought in the late twentieth century. Governments around the world embraced fiscal discipline, privatisation, and deregulation not as temporary measures, but as permanent constraints on public ambition. Austerity policies slashed budgets across health, education, infrastructure, and science—always in the name of efficiency, always promising that markets would fill the gaps.

This transformation was heavily influenced by public choice theory, popularised by economists like James Buchanan and Gordon Tullock. Their work portrayed public servants as self-interested actors no different from private market agents, framing the state as inherently prone to inefficiency and rent-seeking. Rather than seeing government as an institution for collective value creation, this ideology painted it as a bureaucratic burden to be minimised. The state's role was reduced to correcting market failures when strictly necessary.

Compounding this ideological assault was the reliance on static tools like cost-benefit analysis (CBA), which came to dominate policy decision-making. While ostensibly objective, CBA systematically sidelines long-term, transformative goals in favour of quantifiable, short-term gains. Such metrics discourage exactly the kind of risk-taking and innovation that built the foundations of modern technological society—including the decades of public investment in battery technology, electric vehicle charging infrastructure, and federal tax credits that enabled Tesla's success.

This institutional weakening created fertile ground for the consulting industry's capture of government functions. As detailed in “The Big Con: How the consulting industry weakens our businesses, infantilises our governments and warps our economies,” governments increasingly outsourced core capabilities—policy design, strategic planning, implementation oversight—to private firms. This wasn't merely cost-cutting; it represented a fundamental erosion of confidence in public sector capacity. Consultants offered polished solutions and technocratic expertise, but they reinforced the very limitations they claimed to solve, promoting one-size-fits-all approaches driven by corporate logic rather than democratic purpose.

Why Governments Are Not Startups

DOGE's fundamental error was treating government like a Silicon Valley startup—a category mistake that reflects decades of ideological conditioning. As detailed in my recent article with Rainer Kattel in Project Syndicate, "Governments Are Not Startups," startups prioritise rapid iteration, technology-driven disruption, and financial returns for investors. Their success often hinges on solving narrowly defined problems with single products within single organisations.

Governments, by contrast, must tackle complex, interconnected issues like poverty, public health, and national security. Each challenge calls for collaboration across multiple sectors and careful long-term planning. The idea of securing short-term gains in any of these areas doesn't make sense. Unlike startups, governments are supposed to uphold legal mandates, ensure the provision of essential services, and enforce equal treatment under the law. Metrics like market share are irrelevant because government has no competitors.

The startup mentality encourages piecemeal solutions that can exacerbate existing inefficiencies. A city might create an app to report potholes, gaining quick wins in citizen engagement, but this doesn't help consider more sustainable transportation systems that reduce carbon emissions and improve public health. Similarly, introducing a digital health app within a weak healthcare system may offer incremental improvements but won't address underlying systemic issues like workforce shortages or geographic inequalities.

DOGE embodied exactly this startup logic: young tech workers with no government experience making rapid decisions about complex policy programmes they couldn't possibly understand. The predictable chaos that followed—from disrupting nuclear security operations to grounding air traffic controllers—illustrated what happens when "move fast and break things" mentality meets democratic institutions that serve life-and-death functions.

DOGE as Latest Chapter, Not Final Assault

Against this backdrop, DOGE appears not as a disruptive innovation but as the logical continuation of decades of state hollowing. Musk's team, armed with laptops and contempt for institutional knowledge, represented the latest stage of a process that had been systematically destroying government capabilities for generations. Their rapid-fire cuts and wholesale dismissals weren't breaking new ground—they were continuing demolition work that had been underway since the Reagan era.

The Financial Times investigation revealing that DOGE's claimed $170 billion in savings were largely fictional demonstrates the poverty of this approach. Many "cancelled" contracts had already expired, others represented inflated valuations of hypothetical spending, and some cuts—like firing cancer researchers and veterans' mental health providers—revealed a complete inability to distinguish between waste and essential services. This wasn't efficiency; it was vandalism dressed up in the language of innovation.

The chainsaw metaphor that DOGE embraced—borrowed from Argentina's Javier Milei—perfectly encapsulates this destructive mindset. As our "Beyond the Chainsaw" panel emphasised, efficiency has become "an extremely charged word" that sounds technical but is actually about power. When Argentina gutted its national programme for adolescent sexual and reproductive health—a programme that had halved teenage pregnancies across two successive governments—it wasn't about efficiency. It was about ideology masquerading as technocratic reform.

Yamini Aiyar speaking at the UCL IIPP Forum, RETHINKING THE STATE, on the broad disenchantment in democratic states that preceded more recent discourse around state efficiency:

As Yamini Aiyar, Former Chief Executive Officer at the Centre for Policy Research, warned during our "Beyond the Chainsaw" panel, globally there is "broad disenchantment with democratic states," with efficiency increasingly adopted to pursue undemocratic centralisation of power under the pretence that this will enable governments to "get things done." Through pursuit of efficiency, we sacrifice key aspects of democracy—the time-consuming but crucial processes of democratic bargaining, social audit, and citizen participation that make states accountable to public rather than private interests.

The prevailing model's emphasis on "efficiency" too often confuses outputs (how many contracts were cancelled?) with outcomes (what services were improved?). As Rohit Chopra, Former Director of the US Consumer Financial Protection Bureau, observed during our "Rethinking Public Value in the Age of DOGE" panel, efficiency in itself is not synonymous with value—we need new ways to measure outcomes that speak to broader values, moving beyond purely monetary terms to consider good health, resilience, and stability.

Rohit Chopra speaking at the UCL IIPP Forum, RETHINKING THE STATE, on reformulating our understanding of efficiency:

From Watchdogs to Lapdogs

DOGE's assault on regulatory agencies reveals its true purpose: not efficiency, but the systematic dismantling of public oversight. As Rohit Chopra warned during our Forum, DOGE represents "shutting down the watchdogs and turning them into lapdogs—furthering the corporate interests that they should instead be regulating." The goal isn't just to weaken government, but to transform it into what Damon Silvers called a "predatory state, one that operates like a protection racket at a global scale."

Damon Silvers on the transition from Neoliberal state to predatory state:

The CFPB itself exemplifies what's at stake. Created after the 2008 financial crisis, the agency returned billions to defrauded consumers whilst operating at a net financial gain to the government. It succeeded because it had three essential elements of market-shaping institutions: a mission to protect public interest, deep expertise and resources, and political backing from committed constituencies. Yet DOGE targeted it precisely because it worked—because it reshaped markets rather than merely correcting failures after the fact.

This pattern extends across the federal government: cuts that sound technical but serve political ends. As our Forum discussions revealed, DOGE had clear political purpose with deep underlying effects—providing ideological justification for Trump's tax cuts for the wealthy whilst systematically attacking organisational capacity that takes decades to rebuild. The National Labor Relations Board, Environmental Protection Agency, and Department of Education all faced strategic strikes designed to constrain corporate oversight.

The Irony of Public Dependence

The deeper irony of DOGE lies in Musk's own dependence on the very state capacity he sought to destroy. Over the last sixteen years, Musk's business deals with the government total nearly $20 billion. Tesla's success relied on decades of public investment in battery technology developed through Department of Energy programmes, federal tax credits for electric vehicles, and government-funded charging infrastructure. SpaceX built upon NASA's research and continues to depend on Defense Department contracts worth billions.

This pattern extends to the broader Silicon Valley ecosystem that DOGE claimed to champion. The internet that enabled social media platforms emerged from DARPA funding. GPS systems powering ride-sharing apps were developed by the US military. The touchscreen interfaces that define modern computing originated in CIA-funded research. Yet OpenAI launched a new deal for integrating ChatGPT into the US public sector the same week DOGE announced mass employee reductions—a perfect example of privatising gains whilst socialising risks.

DOGE's assault on government research capabilities thus represented a form of ladder-pulling—using the rhetoric of efficiency to destroy the institutional foundations that enable innovation. The emergence of China's DeepSeek AI breakthrough during DOGE's tenure provided a stark reminder of what sustained investment can achieve, even as American research programmes faced the axe.

Understanding DOGE also requires recognising it as part of Musk's broader pattern of value extraction from public institutions. As Rohit Chopra observed during our "Rethinking Public Value in the Age of DOGE" panel, DOGE operated "at the intersection of financialisation and technology ideology." Large technology conglomerates pool behavioural data to create networks of information about citizens' daily lives, with AI systems poised to extract extraordinary private gain from this information. While speculative, DOGE's ability to tap into treasury payment systems and acquire CFPB files suggests potential desire to catalogue this information as trade secrets for private gain.

The International Contagion Effect

DOGE's influence extended far beyond America, inspiring a wave of copycat initiatives across the Atlantic. In Britain, movements like "UK DOGE," "Woke Waste," and "Shadow DOGE" emerged, all promising to identify government inefficiency using similar methods. Conservative politicians like Kemi Badenoch declared that a future Tory government would implement something "like" DOGE, suggesting it wasn't "radical enough".

This international spread reveals how successfully the ideology of state minimalism has colonised political discourse, repeating the transatlantic neoliberal coalition that spread from Chicago School economics to Thatcher's Britain to post-Soviet shock therapy. The appeal of technocratic solutions to complex governance challenges reflects not just policy preference but the deeper erosion of faith in democratic institutions—an erosion that DOGE's chaotic implementation accelerated rather than addressed.

The Human Cost

When it came to meaningful fiscal impact, DOGE was all bark and no bite—cutting foreign aid programmes and diversity initiatives provided easy targets that generated headlines without meaningful savings. But the human cost was enormous. DOGE's cuts to USAID programmes affected millions of people globally, from sexual and reproductive health services in sub-Saharan Africa to clean water initiatives in South Asia. The 83% reduction in USAID programmes didn't just represent budget lines—it meant pregnant women losing access to prenatal care, children losing access to vaccines, and communities losing access to climate adaptation support.

Domestically, the firing of cancer researchers halted critical studies, veterans lost mental health support, and national security operations faced disruption. The costs of rebuilding these capabilities—both financial and in human terms—far exceed any savings DOGE claimed to achieve.

Building Real Government Capacity

DOGE's failure illuminates what genuine government reform would require: building the structures and capabilities that enable governments to be responsive, resilient, and effective. As our Forum discussions emphasised, for a state to reasonably consider efficiency, it must first define its purpose and objective, then match capacity and capability against those objectives.

As Elizabeth Linos, Emma Bloomberg Associate Professor of Public Policy and Management at Harvard Kennedy School, outlined during our "Beyond the Chainsaw" panel, the public sector needs three pillars for ambitious policy change: people (skills and capabilities), processes and infrastructure, and feedback loops for testing and adaptation. As Yamini Aiyar observed, we need to "re-enchant society and actors of the state with the belief that the state can deliver"—but this requires embedding purpose and capacity, not just cutting costs.

Elizabeth Linos speaking at the UCL IIPP Forum, RETHINKING THE STATE, on the three pillars for policy change:

Rather than cutting capacity, we need to rebuild it. This means reversing the consulting capture that has hollowed out government expertise, rebuilding in-house capabilities for policy design and implementation, and creating institutions capable of long-term strategic thinking. It means recognising that targeting organisational capacity rather than budgets is more destructive—whilst budgets can grow and shrink across cycles, it takes decades to rebuild institutional knowledge once destroyed.

The Real Lesson

The lesson from DOGE's failure returns us to the fundamental question: efficient at what, and for whom? DOGE proved efficient at dismantling oversight, efficient at creating chaos, efficient at serving the interests of those who benefit from weakened democratic institutions. But it failed catastrophically at its stated purpose of improving government performance or reducing deficits.

Governments are not startups, and democracy requires institutions strong enough to address 21st-century challenges. The startup mentality that prioritises rapid iteration and financial returns is fundamentally incompatible with the long-term, collaborative, legally mandated work of democratic governance.

Building government capacity for public purpose requires rejecting the ideology that produced DOGE and embracing a more ambitious vision of what democratic governance can achieve. The real question isn't whether government is efficient, but whether it's effective at creating public value, addressing collective challenges, and serving democratic purposes. As we learned in real time, disruption alone is a recipe for disaster. True efficiency comes not from destroying government capacity, but from directing it toward genuine public purpose—efficiency for the many, not the few.

DOGE represents the latest chapter in a fifty-year project to dismantle the state, but it need not be the final one. The question now is whether we can learn from this latest assault to build back better—creating institutions that are both effective and democratic, both innovative and accountable. The answer will determine whether the next chapter in this story is one of reconstruction or continued demolition.