Updated: Aug 26, 2022
Say this common policy resolution pops up one day: TH should implement a UBI. Wait–it doesn't matter how good or bad an idea that is. There's no way in our current political climate a UBI could ever even exist, so it is impossible for the gov to actually enact any change!
Fiat power is a way to get around this. In Latin, fiat literally means "let it be done." The gov has the power to fiat that one thing in their plan automatically passes, so they can debate the potential effects rather than whether or not it is a political reality.
That way, if the gov brings up a plan about raising taxes, the opp cannot respond with, "Well, you don't get your positive impacts, because Congress would never let that pass!" Gov is protected by their fiat power.
Limits of Fiat
The gov can only fiat that one thing in their plan automatically passes. For example, if they have a plan to raise taxes and to launch a coup against the US, they can only fiat one or other. A plan that has planks unprotected by fiat power is known as multi-fiat. That's bad because the gov can no longer guarantee its plan even passes.
For this reason, gov's plan should be limited to one bill!
Note: if opp runs a CP, they also get fiat power (though don't forget–they lose presumption in the bargain.)