Business in Britain seems to be on hold as we await the
result of the most closely contested and uncertain General Election for 18
years. Thousands of traders will be at their desks in the City of London
throughout the early hours of Friday morning, ready to buy and sell currency
and shares as the results dictate.
However, our own prediction is that there will be no
dramatic surges or slumps on Friday.
For one thing, whoever wins the election makes relatively
little difference to the economy. The same basic problem faces whoever ends up
in charge. There will have to be both cuts in public spending and increases in
taxation to deal with the horrendous government deficit. The markets, glancing
nervously as what is happening in Greece, have already factored this into their
More immediately, the result of the election may well not be
clear on Friday.
For many years British elections were run with old fashioned
efficiency by local council officials, with votes being counted within hours of
the close of poll and most seats being declared in the early hours of the next
Despite the fact that this system worked perfectly well, a
wholly superfluous new bureaucracy, the Electoral Commission, was established
in 2000 to oversee elections – as so often, it was change for the sake of
change. However, since there was little room for improvement, the effect of any
change could only be in the opposite direction.
Where counts used to be swift and immediate, many are now
postponed until the next day.
Businesses which have to deal with a number of different
bureaucracies have always known that having more bureaucrats does not make a
bureaucracy more efficient. Bureaucrats make work – for themselves and others –
to justify their position. As Parkinson’s Law explains, “Work expands to fill the time available for its completion”.
Indeed, judging by the decline in the management of British
elections, it seems that having more bureaucrats positively makes a bureaucracy
more inefficient. If anything, Parkinson understated the problem.