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Comment by natmaka | Hacker News Reader

AFAIK this is common practice in many armies, where each group obtains a predetermined amount ('dotation') of goods (gas, ammo, clothes...) for a given period (often a year), uses whatever it needs, then an accounting process takes into account whatever wasn't used in order to calculate the next dotation.

It seems consistent and efficient.

However it neglects human nature.

The soldiers want to avoid missing anything, they simply refuse to see their dotation reduced, therefore just before the end of the period they discreetly use (without any other reason) or destroy all unused goods.

Centralization and bureaucracy excel at breaking human will and things altogether.

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It's also a common practice in any department that has their budget determined this way, e.g. https://vimeo.com/27060669

I'm not sure if I have ever heard of any budgeting that didn't have exactly that problem. Perhaps budgeting on specific problems? That still might require separating budget for headcount....

Yeah, I had a GF that worked for a government research department. The last quarter of the year the department staff did ridiculous things to ensure every penny of the budget was spent. Frivolous travel, non-relevant conferences, parties, etc. As someone who worked in the private sector and managed project budgets I was blown away haha.

I have experienced this in the private sector as well...

I workes for a big telecommunication company in Australia and they did tge same thing with theur yearly budget.

At tge end of the financial year they would hire consultants for "ghost" projects that were supposedly starting in the future eventually.

This meant that they could book the costs for the current financial year and reduced the chance of getting their budget cut due to unused money

Australian University checking in. Use your budget, or get next year’s budget cut

This is the guiding mantra of every US Federal grant program.

I'm not too familiar with the practice, but Zero-based Budgeting (ZBB) seems like it can solve this problem. It basically requires constant justification of the budget (as if you were making a budget from scratch) rather than looking at relative changes year-over-year.

See https://en.wikipedia.org/wiki/Zero-based_budgeting for more.

It's very unclear to me how this is all that different from basically any other means of allocating funds that people use.

The only fundamental difference seems to be the rate at which you re-evaluate allocations.

Conceptually I see how this mitigates the sort of waste described by the OP, but implementing it seems ridiculous. How would you conduct bureaucratic audits in the middle of military operations?

That would only save money if the zero-based-budgeter is willing to fire all the humans who are making up bullshit to justify their budget.

Just goes to show the mentality of bean-counters in times of abundance. Their ledger is the world and the world is their ledger, no exceptions.

It's sad that we as organizations and citizens accept and perpetuate this kind of behavior.

Yes, in the Army there is even a term for this: spendex. (spend exercise). A lot of fun blowing through all your extra ammo at the end of the year!!!

"Use it [budget] or lose it." End of the year buying 100 $2500 toilet seats and 1000 $100 spools of wire. Welcome to government!

PS: My mom was a civil service accountant with the Navy, and my dad and both grandfathers were USAF.

That's absolutely not a "government" thing, it's an issue in every large organisation and large companies are absolutely not immune to it.

Government just happens to be the largest of the large.

Yep, and the really interesting thing is when you combine libertarian principles with this insight. If large corporations (and large concentrations of individual wealth) are as undesirable as large governments, then the economic model starts to look very different!

Out of curiosity, how would a "libertarian" propose we achieve economic anything without large individual concentrations of wealth?

The wording of your question confuses me, it's not clear whether you're asking about "large individual concentrations of wealth" as a cause or effect of "economic anything", aka are you asking how one can achieve economic anything without a pre-conditional individual concentrations of wealth or are you asking how one can achieve economic anything while avoiding the subsequent trap of large individual concentrations of wealth.

In context and logically I would assume the latter as those large concentrations are why you get large organisations to manage them, but I wanted to be sure.

I had not considered moving the question to either end of the bookshelf, is it concentrations first and then economic action, or economic action and then large concentrations. Instead of waiting for the boolean T or F on which it is, we could answer both and see:

"One needs money to make a business." (not possible without large concentrations of wealth, business as a result of wealth)

"Businesses occasionally make people super wealthy." (happens as a result of economic action, wealth as a result of business).

Does not the reaction halt if there is not enough wealth to make a business?

sort of a weird question. libertarians don't necessarily consider large concentrations of private wealth to be a problem in and of itself. they are concerned more with the power of institutions, usually (but not always) the state.

the libertarian dream, as I understand it, is sort of like the unix philosophy applied to business: a large number of small/medium-size firms each offering a focused line of products. of course, libertarians disagree on exactly how to get to that world, but most don't oppose stuff like antitrust regulation on principle. intervening in the case of market failure is usually considered to be one of the (few) legitimate roles of the state.

Yes, but the position of libertarians with this attitude is inconsistent, because in a capitalist society, having a large concentration of wealth implies a concentration of power. To be a consistent libertarian you must oppose disproportionate concentrations of power in all forms.

Essentially much stronger anti-trust laws which break up large institutions, and distribute large concentrations of wealth. It's the only way to spread power.

Thanks for your reply! this is a very interesting dialogue about Wealth Concentration and Ability to Make Economic Moves. Recall Standard Oil, and how anti-trust laws were passed to try and break up this monopoly, but it was many decades too late as the damage had been thoroughly done -- wiring for oil oligarchy was set in place and could not be untangled. In these cases, is there a more elegant solution than the post-fact "since we cannot create competition, naturally or artificially, split your winnings with the government." ?

Destroying concentrations of wealth, but keeping individual humans responsible for wealth echoes the faulty assumptions of communism; if we dilute economic power too greatly by reducing concentration too much, we may be able to allocate excess funds to the creation of new competition in the domain (government-funded anti-monopols), but that simply deletes profit and deletes the profit-incentive of new industry.

"Power always comes from some abstract entity that everyone can talk about, but no one can point to."

I find a huge chasm in understanding between wealth concentrated on individual humans who have their own motivations, and concentrations of wealth in corporations or distributed decision making entities. Which are we opposed to?

Remove limited liability as a concept: stop funding the extrinsic risks of large corporate actors. Don't shield stockholders from criminal and unethical acts committed in the organization's name. Watch the incentives change and only very small companies exist. Where necessary, big companies will be run VERY cautiously, as they should be.

EDIT: of course this would "economically devastating", at least to the present way of being, can you imagine the risk of being an officer in a large corporation or a stockholder? but maybe the economic advantages of reduced corruption and mega-corp inefficiency would soften the blow in the medium to long term?

Changing the landscape of the Savannah in favor of "only tiny cheetahs" risks deleting cheetahs altogether. What level of concentration is undesirable, and what level is necessary for the next investment?

Another one I dislike government programs that are “cut” when really they just have a reduced rate of increase, rather than a lower gross amount.

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