A puzzle: why does a government do something that appears to hurt its voters interests, year after year, decade after decade, without changing course?
The standard answers are comforting. Incompetence. Corruption. Bad leadership. Replace the people, fix the problem.
But what if the people aren’t the problem? What if the system is working exactly as designed - and the outcome that looks stupid from the outside is actually the rational result of the incentives inside?
Consider immigration.
Every British government for thirty years has promised to control it. Every British government has seen net immigration rise. Labour and Conservative, tough talk and soft talk, points systems and caps - the numbers go up regardless.
The standard explanation is that politicians are weak, or lying, or both. But look at the incentives.
Immigration delivers cheap labour to business - a reliable source of donations and political support. It allows the construction industry to build without raising wages. It keeps the NHS staffed without training enough British doctors and nurses. It suppresses wage growth in low-skilled sectors, which keeps inflation down. The beneficiaries are organized, concentrated, and politically connected.
The costs - housing pressure, stretched public services, cultural change - are diffuse and slow. They do not organise. They do not donate. They vote, but there is always another election to kick the can to, and by then the numbers have changed again.
The incentive is clear: talk tough, deliver more. Everyone who ‘matters’, wins. Only the country as a whole loses.
Now consider “net migration” itself.
The Home Office reports net migration: arrivals minus departures. A country that sees 700,000 arrivals and 200,000 departures is reported as having net migration of 500,000. A country that sees 300,000 arrivals and 200,000 departures has net migration of 100,000. These are presented as the same kind of thing, differing only in magnitude.
They are not.
Arrivals require housing, school places, NHS capacity. They change the culture, the language, the character of the country. Departures take income tax, skills, and national identity with them. These are not symmetric. A 500,000 arrival figure and a 500,000 “net” figure describe two completely different countries.
But net migration serves the political class. It makes the number smaller. It hides the hole in the bucket - the British citizens who are leaving. A headline of “net migration 500,000” is politically manageable. A headline of “700,000 people arrived this year and 200,000 British citizens left” would not be.
So they report net. Because it suits them.
This is not a conspiracy. It is structure.
The same logic applies to almost every government function. The NHS was created to improve national health. It now measures success by activity: patients treated, operations performed, waiting lists processed. A healthier population would mean less activity. A smaller waiting list would mean a smaller budget. The organisation has no incentive to reduce demand for its services - and every incentive to appear overwhelmed. So it does.
The Home Office does not have an incentive to “solve” immigration. Its budget, its staff, its political importance all grow with the perception that immigration is a crisis that needs managing. Solving it would be a career-ending achievement.
This is the bureaucratic incentive in its purest form: the organisation that exists to solve a problem has an interest in the problem never being solved.
It runs deeper still.
Protest movements and campaign groups look spontaneous from the outside. Look closer and you find funding. Sometimes from wealthy individuals with political agendas of their own. Sometimes from foundations whose endowments depend on keeping the issue alive. Sometimes directly from government grants that reward advocacy.
A group that campaigns for more housing regulation receives grants because the housing problem exists. If the problem were solved, the grants would stop. The same is true for the group that campaigns for more immigration, or less immigration, or more climate action, or less. Everyone in the ecosystem has an interest in the problem persisting.
This is not corruption in the legal sense. It is just how the system works. Money flows to organisations that keep the issue visible. Keeping the issue visible requires the problem to remain unsolved. So it remains unsolved.
What does this mean for the voter?
The voter is expected to cut through these incentives, identify the true interests at play, and vote accordingly. But the voter has a job, a family, and limited time. They rely on the same media that relies on the same pressure groups that rely on the same government funding. The information they receive has passed through a system where every participant has an incentive to frame the problem in a particular way.
The voter cannot cut through it. That is deliberate. The system was designed for a smaller, slower, simpler world where heuristics worked.
The uncomfortable conclusion.
Good people in bad systems produce bad results. Replace the people and the same thing happens, because the incentives have not changed. The minister arrives full of reformist zeal and leaves two years later, ground down, having achieved nothing. The next minister does the same. The department outlasts them both.
The bureaucracy is permanent. The incentive is permanent. The problem is permanent.
This is not an argument for despair. It is an argument for looking at systems, not people. For asking, every time you see a stupid decision: what incentives produced this outcome? Who benefits from the problem continuing? What metric is being used, and whose interest does it serve?
Incentives matter. They matter more than promises. They matter more than manifestos. They matter more than good intentions.
Follow the incentive. The stupid decision will start making sense.