Why don’t goverments admit mistakes?

Why do governments  — and for that matter, most organizations — resist admitting mistakes, even old ones?  (And why do they keep repeating the same mistakes?) A recently-released British historical document suggests part of the reason. The Guardian reports on a note written by Margaret Thatcher less than a year before she became Prime Minister of the UK:

A letter from July 1978, while she was still leader of the opposition, reveals Thatcher’s legally inspired reluctance to concede that mistakes had ever been made. Opposing plans to publish a history of military intelligence in the second world war, she observed: “I was taught a very good rule by my two Masters at Law, both of whom are now judges: never admit anything unless you have to; and then only for specific reasons and within defined limits.”