Yes but the challenge is that the article is rhetorically lax because it doesn't provide a domain specific case example of the Shirky principle playing out in government yet submits the hypothesis that the principle supports backwards government behavior. It’s a fair point and it’s why people are presenting (the somewhat obvious but missing) government examples.
That's because we as humans like predictability. And hence, stock market rewards predictability. So, a large company's finance department allocates, say, travel budget, to all divisions based on their past year's travel spend +/- some margin. So, now, if you are division head, you are going to make sure your travel spend for the current period is at least as high as last cycle to ensure your travel budget for next cycle doesn't shrink. This means you may encourage your employees to use that travel budget by traveling even if such travel wasn't absolutely necessary. This happens all the time with all sorts of budgets in all sorts of organizations.
In businesses that is kept in check via competition. Startups can beat old companies that gathered too much such bloat, the same is not true for governments since they don't get competed out. Even in democracies most of the government bureaucracy stays even when the opposite party gets elected, you need a total revolution to flush that out and those happens very rarely.
No, but we already do. Huge amounts of public money is spent by government on consulting firms, private contractors and industry grants/incentives.
Yet the public doesn't generally consider these firms to be publicly funded organizations, despite taxpayer money being the primary revenue source for many of them.
The government switches external firms as soon as another firm seems to be able to do it better, that isn't true for the governments own parts. That makes the two fundamentally different, one can accumulate bloat forever the other will get renewed from time to time. Private profit seeking adds overhead though so which one is better depends on the domain we are talking about, in some cases private are better in other government are better.
We certainly do have to, at least for certain values of “we”. An example in the US is the current legal obligation to procure private health insurance. (There are exceptions to this obligation, generally lack of means, and in turn may qualify one to procure private insurance with tax subsidies.)
I had to refresh my memory, so I looked it up. What I see now is that the mandate is technically still law, but the tax penalty was eliminated. Not that it’s a meaningful distinction, just an odd legal artifact.
