Here are my thoughts as to why government tends to be inefficient compared to the private sector. Of course, I am speaking in generalities and trends and am not condemning every government employee or program.
1. Government doesn't have to show a profit, therefore the motivation to excell is absent. The phrase "close enough for government work" says it all. In order to make a profit, firms must excell at delivering a good or service; to do otherwise is to go out of business.
2. The civil service in days gone by was staffed by way of political patronage. That is, the currently elected officials won the right to choose friends, supporters, and cronies to fill government jobs. The government job was a reward for services rendered. After while, a few people who were not completely corrupt decided that the turn-over and obvious conflicts of interest of using this "spoils system" to fill the ranks of the civil service was not in the interests of good government. The Pendleton Act of 1883 changed the civil service to one based mostly on competitive merit hiring and eliminated the spoils system of rewards for political parties. This change was beneficial to the government and for the welfare of career civil service employees who could hold a job over time without fear of losing it to the changes of political winds.
As so often happens, a good idea or system becomes perverted and twisted into another shape. Over time, government employees have become accustomed to the protections that their employment provides and to a large extent have become imbued with a sense that they can relax, they are protected, they are in positions of relative safety in the work force. This attitude does not foster a sense of "hustle" or precision.
3. A term of great currency regarding government operations is "Red Tape." I haven't looked up the dictionary definition of the term, but I know what it means and so does everybody else. Red Tape isn't just paperwork; it's an entire system of over-caution, cover-your-Heinie and unnecessary redundancy. Good government should be pursued with some degree of caution; it should not grind to a stand-still through over-caution. Things need to get done. But then again, what I have outlined in paragraph 2, above, contributes to this problem.
3a. US government tends to be penny-wise and pound foolish. They lose sight of the big bucks by concentrating on small potatoes. In the post office, they are afraid that an employee might steal 25 cents from them, but they lose millions (these days billions) a year on institutional and structural deficiencies. In private enterprise, risk-taking is just part of the game of making money and surviving in business. Because government is cautious by nature, it tries not to take risks. This point is interesting because in spite of all its caution, the government still finds it quite easy to lose billions of dollars.
3b. The legal profession has sunk its fangs into the jugular of the government much as it has the rest of society, so this causes the addition of numerous legal considerations into every government process.
4. One of the biggest detriments to a smooth-functioning government is the lack of consensus and the intrusion of provincial and special interests into policy making. At the policy-making level, every special interest is competing to have its own goals achieved. The result is that instruction to government is fractured, diffuse, and over-expectant.
5. The habit of deficit spending that policy-makers got into in the 20th Century that continues to this day does not foster good government. When a government decides that there is no limit to the amount of money it can create or borrow, there is no incentive for efficient management of resources. This policy also feeds the fire of entitlements which contributes to the problem I have outlined in paragraph 4, above.
These are just my own thoughts. What are yours?