Complex Systems

One of the things you learn quickly when working with complex software is that one tiny change in one area of the program can result in unexpected behavior in another, unrelated, part of the software. Even when you know the software in detail, you are often surprised by the results of small changes. The reason for this is there are so many variables and related conditions, it is impossible to keep them in your head all at once. There are limits to how many chess moves the mind can anticipate. Put another way, we’re not that smart. Even high IQ types who work complex problems in physics run into this, which is why they control for as many things as possible in their proofs.

Anyway, the social planners never seem to get this or even recognize it exists. They are so confident in their power to model the new socialist man they blithely assume all sorts of things about the human condition. ObamaCare is a good example of this at work. They started with one goal in mind. They wanted to transfer the costs of giving middle-class health care to the poor from the government to private business. That means mandating coverage for employers. They quickly figured out that the unemployed and seasonal would not get coverage so they came up with the individual mandate.

It sounds good. If you have a job you employer has to pay the freight. If you don’t have a job, then you have to pay the freight. Eventually, people with eyes and time on earth in America explained that ghetto dwellers were never going to buy insurance. They also explained that most employers could not afford insurance. That means expanding Medicaid and subsidizing private insurance. One and one it went until the result was a 2,000 page bill requiring tens of thousands of regulators writing tens of thousands of pages of regs. All of which would be layered on top of the existing tens of thousands of regs. A massively complex system was going to bolted onto a massively complex system the legislators did not understand.

Since becoming law, we have been treated to a hilarious series of unexpected results. Employers are afraid to hire, not knowing the consequences. Their lawyers quickly figured out a way out of the mandate by moving from full time to part time. Hundreds of thousands have lost benefits because they are now part time. Now, cities in financial trouble will follow suit by throwing their workers onto the government system to avoid paying health care bills. Detroit is first up, trying to erase a few billion in expenses by shoveling their employees onto the dole. You can be sure every other city will look to do something similar. It is too tempting.

The result of all of this is pretty much the opposite of what the central planners expected. Instead of decreasing the cost to government, costs will go up faster. Instead of more people with insurance, you will see fewer people with insurance. Unions are ready to revolt because they suddenly find themselves no longer able to offer benefit plans. Doctors, seeing their earnings prospects decline are leaving the system and finding ways to carve out private systems for upper middle-class clients. On and on it goes, a myriad of unexpected outcomes accelerating the collapse of the health care system.

Wisdom is knowing what you don’t know. The opposite of that is being a liberal central planner.