Posted by
Chuck Hakes on Saturday, February 21, 2009 5:12:52 PM
According to definition, heuristics is a decision process that may or may not yield practical results, may involve trial and error, intelligent guesswork, “seat-of-the pants” reasoning, “rules of thumb,” a lack of an organized decision procedure centered around an hypothesis, and other imperfect decision short-cuts.
A heuristic approach to making decisions might be applied when there is no decision algorithm that can be applied to lead to an expected outcome. It is in short, an attempt to reach conclusions that may or may not be sound, but must be made because of the absence of a reliable decision algorithm.
If a person does not understand diamonds, the heuristic that higher price equates to higher quality in diamonds of the same size leads to a conclusion that may or may not be correct in a given application.
You don’t touch a hot stove because as a kid you learned the algorithm that the outcome will be getting burned.
In your first experience with a hot stove as a child you may have tried a heuristic approach and learned by trial and error that you would get burned.
This groundwork leads to a short discussion of government heurocracy. The Obama campaign promised us economic solutions as if the algorithms to restore the economy were known to him and results were guaranteed if only he were elected to office so he could save us all by pressing the right buttons. Now we hear that it is going to take much longer to fix and the cost is high and unknown.
The Democrats did not have an algorithm that would lead to predictably desirable results. It does not exist. If it did there would be no disagreement among economists.
If the Democrats thought they had the magic medicine they were foolish. If they thought they might have it but weren’t sure they should not have raised false expectations.
There was hope all right – the hope they might get lucky and something would work.
But let’s tell it like it is. Having a solution was not the priority. Getting elected was.
Many situations in life don’t have predictable outcomes. War is one, yet Obama and his cohorts, who are now taking a heuristic approach to fixing the economy are the same people who decried the lack of predictability of events in the Iraq war. A student of the subject knows that it was specifically the lack of predictability that prompted McNamara and his WWII whiz kids in the development of the branch of probability known as game theory. One wartime application of this was to estimate how many bombers had to take off for a given number to get through the flak and the Messerschmitts to deliver their payloads.
So now we are being led by a government of clueless heurocrats who convinced the American people that they had the answers and could solve the problems, but who, in reality wanted to take a shot at making their own guesses and trial and error attempts at solutions.
There is one huge difference between America’s present economic situation and the preceding hot stove example. The Washington heurocrats will try to find economic solutions through heuristics. It will be the American people who get burned.