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Fix the economy
Draft

Adaptive Economic Operating System

A feedback-controlled market economy designed around human wellbeing, productive freedom, circular resource use and measurable public value.

Solution section

Public Expenditure

Spending judged by traceable outcomes, not budget utilisation alone.

Public expenditure

Government spending is the other major control input, and the same logic applied to taxation applies here: expenditure is not itself the outcome.

Public Resource→Organisation→Activity→Output→Outcome\text{Public Resource} \rightarrow \text{Organisation} \rightarrow \text{Activity} \rightarrow \text{Output} \rightarrow \text{Outcome}

The governing question is causal, not merely financial: what did this expenditure actually achieve? A £1bn programme producing a small improvement and a £200m programme producing a substantially larger one are not equivalent, even though conventional budget reporting can make them look similarly sized as "spending".

Answering that question requires distinguishing where a pound of public resource actually goes:

G=Gfrontline+Gcapital+Gadmin+Gcoordination+Gprocurement+Gmanagement+Gwaste.G = G_{frontline} + G_{capital} + G_{admin} + G_{coordination} + G_{procurement} + G_{management} + G_{waste}.

The objective is deliberately not G_admin = 0 — scheduling, records, planning and accountability are genuinely necessary for services to function safely. The objective is to minimise administration that does not materially contribute to the outcome the spending was meant to produce, and correspondingly to judge public-sector productivity by

Public Value CreatedTotal Resource Cost,\frac{\text{Public Value Created}}{\text{Total Resource Cost}},

rather than by headcount or the wage bill alone — a cheaper workforce that cannot prevent large-scale waste is not more efficient than a better-resourced one that can.