You've probably wondered why fixing a pothole costs the government three times what a private company might charge. Or why public construction projects seem to run wildly over budget while businesses build shopping centers on time. It's easy to assume government workers are lazy or bureaucrats waste money.

But the real story is more interesting—and more forgivable. Government isn't playing by the same rules as private business. The constraints that make public services expensive often exist for good reasons, even when they frustrate everyone involved. Understanding these structural differences helps explain why efficiency isn't always the right measure of success.

When a private company needs office supplies, someone picks up the phone, compares a few prices, and orders. When a government agency needs the same supplies, they might spend weeks writing specifications, advertising for bids, reviewing proposals, and documenting why they chose a particular vendor. This seems absurd until you remember why these rules exist.

Public procurement requirements emerged from decades of corruption scandals. Without competitive bidding requirements, government contracts went to friends, family, and campaign donors. Taxpayers paid inflated prices while connected insiders got rich. Rules requiring public advertising, sealed bids, and documented selection criteria exist specifically to prevent officials from steering contracts to favorites.

Many governments also require participation from minority-owned or small businesses, adding another layer of complexity. These requirements address real historical injustices—for decades, public contracts systematically excluded certain groups. But achieving these goals means splitting contracts, working with less experienced vendors, or accepting higher prices. The extra cost buys fairness and accountability, not just goods and services.

Takeaway

Government procurement costs include the price of preventing corruption and promoting fairness—expenses private companies never incur because they're accountable only to owners, not citizens.

Private delivery companies serve dense urban areas profitably while charging extra for remote locations. Private schools can reject students with expensive needs. Private hospitals can turn away patients who can't pay. This selectivity is how businesses control costs and maximize profits. Government doesn't have this option.

The post office must deliver to every address in the country, whether it's a Manhattan apartment or an Alaskan cabin accessible only by bush plane. Public schools must educate every child who shows up, including those requiring expensive special education services. Public hospitals must treat emergency patients regardless of ability to pay. This universal service obligation fundamentally changes the math.

When you compare costs, you're often comparing a private service that cherry-picks profitable customers against a public service that must serve everyone. The private option looks efficient partly because difficult, expensive cases go elsewhere—often to the public system. Government absorbs the costs that private markets reject, making direct efficiency comparisons misleading at best.

Takeaway

Private businesses achieve efficiency partly by refusing unprofitable customers—government inherits everyone the market rejects, making cost comparisons fundamentally unfair.

A private company CEO can close an unprofitable factory next Tuesday. A government trying to close an inefficient facility faces public hearings, union negotiations, legislative interference, and media campaigns. Elected officials whose constituents lose jobs will fight closure regardless of the numbers. Efficiency often loses to politics.

This isn't entirely bad. Democratic accountability means citizens can influence decisions that affect their lives. But it creates costs. Redundant military bases stay open because senators protect local jobs. Transit routes serve low-ridership areas because council members demand coverage. Agencies can't fire underperforming employees easily because civil service protections prevent political purges.

Government also can't make unpopular decisions that might be efficient. Charging market prices for water during droughts, raising transit fares to cover costs, or closing libraries in poor neighborhoods might make financial sense. But voters expect public services to prioritize access over profit. Politicians who ignore this reality don't stay politicians long. The constraint of democratic accountability adds real costs but reflects genuine public values.

Takeaway

Democratic accountability makes government slower and more expensive than private alternatives—but that accountability is a feature, not a bug, of public services.

Government inefficiency is real, but it's not random. Procurement rules prevent corruption. Universal service obligations ensure everyone gets served. Political constraints reflect democratic values. These costs buy things efficiency metrics don't capture.

Next time you hear complaints about wasteful government spending, ask what the alternative would cost. Sometimes the answer is genuine reform. But often, the "waste" is the price of fairness, accountability, and serving everyone—costs worth paying in a democracy.