Ceteris Paribus in Government Assumptions

Have you ever noticed that the word “unexpected” keeps cropping up in announcement after announcement coming out of the White House, the various agencies within the Executive Branch and in news reports concerning the unintended consequences associated with things that the government has loudly trumpeted are going to “help” Americans?

The “experts” who formulate policy, draft regulations, determine the “proper lunch menu” for school kids are seemingly stunned when things don’t work out exactly the way they thought they would have or, as they see it, should have.

Of course it has to be understood that any plans or actions that will affect a nation of over 300 million souls will always be extremely complex. So complex in fact that the planners, regulators or First Nutritionists inevitably fall back on the use of the assumption described as ceteris paribus. That Latin phrase means, literally, “all other things being equal”. Not equal to each other, of course, but equal to what they were before the busybodies started making changes in a single or a small number of variables. The planners, regulators and nutritionists always work with the unstated assumption that only those variables that they select will vary, while all those variables that they will ignore will remain constant.

Of course they will.

For instance, if kids historically ate an average of a half-pound of food during lunch before the ascendancy of our First Nutritionist, the assumption (ceteris paribus) in the recommendations from the White House as to what kids should eat (not how much, just what) is always that the kids will continue to eat the same amount of food, regardless of exactly what that food is, or how it tastes to kids. Adult taste preferences may influence the choices offered, but it is the child’s taste preferences that will make the final determination as to what will actually be consumed.

The White House is then embarrassed because kids prefer peanut butter to arugula.

“Unexpected”? Not to any normal parent it wouldn’t be, but then again when was the last time you heard the words “normal” and “Progressive” used in the same sentence? But I digress. Progressives have a choice to make. They can admit that the plan that they developed, to control one or two variables was an utter failure, or they convince themselves that if they just controlled one or two more variables, everything would be just perfect.

Of course it will. Please raise your hand if you see the word “unexpected” approaching at high speed.

Turning corn into a biofuel is another example of making ceteris paribus assumptions. Progressives thought that they could take a significant portion of a food crop and convert it into a power source to run the household automobile. That would eliminate that nasty old oil from their pristine utopia, and people would be able to drive to the supermarket without generating too much pollution. Of course with that significant reduction in corn production, there was “unexpectedly” significant shortages of food in those very same supermarkets. If food was there at all, it would be much more expensive because corn is also used as a feed stock for meat animals.

The Patient Protection and Affordable Care Act, or as we have come to know it, Obamacare, is simply chock-a-block full of regulations that rely on reality duplicating the ceteris paribus assumptions made by those who drafted the legislation. For example, requiring employers to subsidize health insurance for their employees that is substantially more generous (and expensive) was assumed to have absolutely no impact on new hiring or to wages and other benefits paid to current employees. And since there was to be no impact on hiring according to these same Progressives, unemployment was to have become a thing of the past. Once again “unexpected”, or perhaps the occasional “inexplicably”, raises its ugly head.

Once again, Progressives look at the conundrum that they themselves created by assuming that it’s possible to change only a single variable in a huge and complex system and not have it impact any other variable, or even all other variables and blame the variables (that would be us, by the way) that changed, not the underlying fallacy that their plan depends upon. Once they breathe a sigh of relief that obviously they, themselves, are not culpable, then they determine what variables (again, us) need to be controlled and what the best way for them to do that very thing might be.

Conservatives intuitively see the lust in the hearts of Progressives to control everything that they see, yet because Conservatives don’t share that lust, they are somewhat mystified by Progressives that do.

Perhaps, and there are no guarantees that this is the explanation, Progressives really do want to do all these wonderful things for people, but fail to realize that the Achilles Heel of all Progressive programs is that they are all based on ceteris paribus assumptions. In order to implement those programs, Progressives or idiots (is that a redundancy?) need to control more and more variables until at last they control absolutely everything under the sun. And the sun itself is probably on their “to-do” list.

Obama and his cohorts would have benefited greatly had they the opportunity to study under the economics professor I had in college. During one class session, he was explaining the dangers of ceteris paribus thinking to us, pointing out that while useful in doing “what-if” analytics, for real world applications it was pretty useless, or as he phrased it:

Always remember, Variables won’t, and Constants aren’t, and nothing will ever change that.

 Cross-posted American Thinker on June 5, 2014


About Jim Yardley

Retired after 30 years as a financial controller for a variety of manufacturing firms, a two-tour Vietnam veteran, and independent voter.
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1 Response to Ceteris Paribus in Government Assumptions

  1. Pete Morin says:

    To paraphrase the late Milton Friedman, why is it more moral to have government attack a problem rather than the private sector. Progressive’s lust for power and control of even the minutiae of our daily lives is hard to figure. No government, or power on earth, could ever replace what individual citizens do by making decisions daily for themselves. What’s even more egregious is progressives faith in tribunals( federal courts) to right aggrieved wrongs.

    Your professor was right, Jim. Ceteris paribus, and progressives is a destructive combination.

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