We swap democracy for dictatorship when we go from home to work. Air grievances about politicians as a citizen and you risk nothing. Speak out against managers as an employee and you risk your livelihood. In normal times, biting your tongue is not too shameful a tactic. Not all managers are monsters and, in any case, if workers broadcast their failings, the most obvious beneficiaries are their company's business rivals, which may profit and grow, and drive the workers' firm under. The ignored lesson of the Great Crash of 2008, however, is that when normal times end, the dictatorship of the manageriat can ruin companies and the rest of society.

What a falling off was there! The most revered executives in the world, whose alleged brilliance justified the highest salaries in the world, turned out to be blind ignoramuses who did not begin to understand the dangers their banks were facing. Like the leaders of the Communist Party of the Soviet Union, the further up the hierarchy they travelled, the less they knew about the true state of the organisations they claimed to be governing. Fear protected them from rational criticism. At RBS, Fred Goodwin and his enforcers accused anyone who questioned his vainglorious expansion plans of belonging to the "business prevention unit". They had to get in line or get out. At HBOS, Sir James Crosby made the most expensive personnel decision in British banking history when he sacked his "risk manager" for warning that the bank's incontinent lending was insanely risky.

A writer is never going to upset public sector readers by laying into bankers, but it is worth worrying about whether the public sector is in a position to mock. The outcome of the election is in some senses an irrelevance. Whatever the composition of the next government, it will have to introduce the sharpest reduction in public expenditure in living memory. In theory, cutting back should not be too difficult. Gordon Brown has doubled spending since Labour came to power. We should be able to reduce it by 10% or 20% without services suffering overmuch, particularly when public sector workers, like private sector workers, know where their bosses are wasting effort and resources. But therein lies the difficulty. They are likely to stay silent because the cult of the supreme manager is as strong in the public sector as the banks, as is the fear it generates.

David Craig, whose books, including Plundering the Public Sector and Fleeced, earn him honourable mentions in dispatches on the follies of the centralised state, cites dozens of examples of a top-heavy bureaucracy. In 1997, the NHS had 12 hospital beds per manager; now it has four. Even in 2008, when politicians were protesting that they wanted to protect front-line services during the recession, the NHS had a 2% increase in medical staff and a 10% increase in managers.

In local government under Brown, the number of people in councils earning more than £50,000 a year has shot up by a factor of 11 from 3,300 to 38,000, while in the economy as a whole it only went up by a factor of three. I could go on quoting him, but it ought to be clear that while the characteristic beneficiary of the Attlee era was the factory worker and the characteristic beneficiary of the Thatcher era was the entrepreneur, the characteristic beneficiary of the Brown era has been the target-setting manager, regulator or consultant.

Workers waste time and money on a vast scale to justify their salaries. At Cafcass, which looks after vulnerable children before the family courts, a social worker must complete five forms to justify every action he or she takes. You'll not be surprised to learn that the forms come from a head office that has seen the number of bureaucrats double in four years and its budget increase threefold. You can find the same story across the public sector. Figures the government tried to hide from Parliament, for instance, show that probation officers spend a mere 24% of their time dealing with offenders. Completing returns and coping with administrative work fills most of the rest of their days.

Harry Fletcher, spokesman for NAPO, the probation officers' union, explained why his members will never dare tell the public about how its money is being wasted. As at RBS and HBOS, they must shut up or get out. To take a recent case, a probation officer told him that prison managers were sending dangerous men to Ford open prison, from where they could wander out of the gates whenever they fancied. When Fletcher told MPs and the press, Whitehall launched a search – not for the criminals, but for his source, and suspended her from work for embarrassing her masters. Cafcass is quietly turning into a national scandal, but the emails Fletcher receives on how it is not delivering help to children or about how its managers are enjoying expense-account living begin: "Please don't reveal my name; if you speak out you are charged with bringing the organisation into disrepute."

This week BBC's File on 4 will broadcast a documentary about the disaster in the family courts. Not only did the Cafcass workers its journalists interviewed refuse to allow the BBC to use their real names, they insisted it distort their voices too. It is as if they were terrified dissidents in a totalitarian regime rather than free citizens in a modern democracy.

The most interesting reform the Conservatives have proposed is not their over-hyped idea to allow public sector workers to form co-ops – Labour already allows that – but their plan to allow the public to check whether the state is spending wisely by publishing details of government contracts online. Politicians should take the next step and think about allowing openness in the workplace so that when cuts come we do not see the managers who overspent in the first place protecting their positions and forcing others to pay the price. Organisations have a collective wisdom. If Britain is to draw on it, the first task is to contain and cull the managerial class which has taken so much while contributing so little.