The Fatal Conceit: An Introduction

The idea behind the “Fatal Conceit” of central planning is the notion that the world is simply too complex for any group of industrial or other planners to survey a city, state, nation or world; grasp it in all of its nuance and detail; and then organize it by force in a way that would be better for everyone than the alternative of life sans planning.  Consider an illustration of just how difficult it is to acquire and process the type of information that one must have to outperform — even outthink — the marketplace as a whole.

How many ways can you arrange just three items such as the playing cards you see below? The answer is six and involves a simple factorial problem (3 x 2 x 1 = 6.) 

But how many ways can you arrange just 20 items? Again, it is a factorial problem of only (20!). But when numbers grow exponentially a seemingly small difference becomes large. Twenty factorial grows to more than 2 quintillion, or more than all of the seconds that comprise 75 billion years. Yet central planners of every stripe are potentially dealing with millions factorial. How is it conceivably possible that central planners could determine everything from the right industry to business to marketing scheme, financing, and geographic location in which to "invest" public dollars in a way that would improve society in a way that would be superior to leaving everyone alone? (For a more detailed explanation, see the study "MEGA: A Retrospective Assessment" at http://www.mackinac.org/article.aspx?ID=7054.)

There are some legitimate rebuttals that city planners like those featured in the Detroit video could offer in response, but explaining those and each conceivable rejoinder to them goes beyond the scope of this blog entry.