Occam’s razor can cut Alaska’s budget problems to the bone

My latest from Alaska Dispatch News:

As our legislators gather in Juneau to consider Alaska’s budget and how to bridge the billions of dollars of shortfall between state income and spending, there are a few key points I would like them to keep in mind. I have twice listened to presentations on the various budget proposals and have each time believed that the principle of Occam’s razor was not being applied.

Occam’s razor is a problem-solving principle that says when you have competing hypotheses, you should select the one with the fewest assumptions. Budgets are the state’s hypotheses of what the fiscal situation will look like over the next year and beyond. In every case, the budget proposals I have seen are based on copious assumptions about future states of numerous variables, two of which I will discuss here. When a budget proposal begins making assumptions about variables a decade or more into the future, it stops being reality and moves into the realm of fantasy. Making assumptions about how we hope the future will be without considering actual facts is irresponsible at best. We need a solution with fewer and more rational assumptions.

Click here to continue reading at ADN

Dr. Holly A. Bell is a wanderer, ponderer, language learner and slaughterer, an optimistic pessimist writer of poetry and novels, and an interdisciplinary professor of Finance, Economics, and Business at the University of Alaska. She lives, loves, and writes in the Mat-Su Valley of Alaska.


Leave a Reply