Not quite sure how you’re defining “inefficient government spending”. Here’s my favorite “nutshell” passage…
Nevertheless, the classic solution to the problem of underprovision of public goods has been government funding — through compulsory taxation — and government production of the good or service in question. Although this may substantially alleviate the problem of numerous free-riders that refuse to pay for the benefits they receive, it should be noted that the policy process does not provide any very plausible method for determining what the optimal or best level of provision of a public good actually is. When it is impossible to observe what individuals are willing to give up in order to get the public good, how can policymakers access how urgently they really want more or less of it, given the other possible uses of their money? There is a whole economic literature dealing with the willingness-to-pay methods and contingent valuation techniques to try and divine such preference in the absence of a market price doing so, but even the most optimistic proponents of such devices tend to concede that public goods will still most likely be underprovided or overprovided under government stewardship. — Patricia Kennett, Governance, globalization and public policy
That’s public finance in a nutshell.
For me, “efficiency” is synonymous with “value”. If we don’t know whether somebody is willing to give up x (more public education) for y (more public healthcare)… then we don’t know whether x > y or x < y. And without everybody’s valuations… it’s guaranteed that the consequence will be extremely inefficient government spending.