Our Best Laid Plans
(that's what she said...)
One thing economists and politicians have in common is that they love a good plan. They have lots of plans: plans for bring about full employment, for raising GDP, for lowering debt, for stimulating aggregate demand, for helping the children, for defeating terrorists, for reshaping the Arab world, for reducing business cycles, for making better schools, and on and on and on.
Everyone's got plans.
None of these plans ever work. If they did, they'd stop trying to come up with new plans. If a plan for bringing about full employment, for example, ever worked, we wouldn't need any new plans for bringing about full employment.
The Key Ingredients to a Successful Plan
In order for a plan to work, you need a few things. First, everyone should know the plan, understand it, and understand their role in it. Second, everyone should be on board with the plan.
You would think that the first part is easy. Not so fast. Let's say your plan will bring about full employment. How are you going to do that if you don't lay out the plan so that everyone can understand it? How are people going to execute the plan if they don't know their role in it?
But let's just say that everyone knows the plan and understands their role. What if they are not in agreement with the plan? What good is it to have a plan which requires the active consent of Billy Bob if Billy Bob doesn't want any part of it?
I try not to make plans that require the active consent of others is I cannot procure that consent (preferably in writing) before I execute the plan. This should be common sense.
The Bigger the Plan
Of course, the bigger the plan, the harder it is to fulfill these requirements. Heck, how many central planners have clearly defined their plans in the granularity required to instruct me to perform a specific role, or tell me how my role impacts the plan? They can't, of course, so they don't. Yet this little bump-in-the-road never deters them from dreaming up new plans.
I Have My Own Plan
In fact, I don't even like saying that they have plans because there is a better way to describe what they are doing. Real planning involves cooperation and coordination between voluntary parties. These economists and politicians have orders they would like to give. They can't even fathom the idea of planning, which is why they are economists and politicians in the first place.
My plan is to recognize the difference between orders and plans, and act accordingly.
David in Qatar