Recently, the New Yorker had a feature article on Aaron Swartz, which featured some excerpts from his writing and interviews with people close to him.  The article/profile was both interesting and frightening, and extraordinarily sad, because it revealed a brilliant young man who never grew up, never truly understood society – any society – and, because he couldn’t understand it, found himself in a position, compounded by illness, where he simply could not cope.  What came through most clearly to me, although this was certainly not emphasized by the writer or by any of those who were interviewed, was the fact that Swartz had absolutely no understanding that society, or any organization or relationship, has limits.

He made a great deal of money very young, but failed to understand that, for most people, making money is anything but easy.  He quit jobs because he didn’t want to put up with the regimentation and requirements.  He got involved in the whole issue of copyright because he didn’t believe in limits… and then, according to the article, had actually abandoned much of that fight when it came back to bite him.

The plain truth of the matter is that any relationship, any organization, any society, any government – in fact anything that goes beyond a single isolated entity – has limits, and the more complicated the organization or group, the more limits that are required for it to function. Children who do not learn this young will always have problems; adults who have not learned this will either be hermits or anti-social outcasts, usually verging on having trouble with others and the law. As the old saying goes, your freedom stops short of hitting my nose… one of the most basic of limits.

Various societies have differing limits, and differing ways of imposing and enforcing those limits, but they have limits. Social and government conflicts are always about the types of limits, their structure, enforcement, and various other details, but not about the fact that limits are necessary.  Even extremists, such as “gun rights” types, aren’t arguing for no societal limits at all – they just don’t want limits over weapons, but most of them, I suspect, would have problems if all limits on everything were removed.  They just want a different set of limits. The same is true of religious extremists, extreme feminists, environmentalists, zealous developers, etc.

In turn, nature or the environment imposes limits.  Air-breathing creatures are not going to evolve in airless environments.  If you don’t eat, sooner or later you’re going to die.  Biology imposes limits.  Most human beings less than six feet tall are going to have a hard time being professional basketball players because smaller stature imposes limits, as does a lack of raw athletic ability.

Yet… in today’s western societies, particularly in the United States, there is less and less recognition of limits, and more and more of an attitude that anyone can do anything, especially in parenting and education.  Limits exist; saying that they don’t or acting as if they don’t is only a recipe for personal and societal disaster.  That doesn’t mean limits preclude success; it does mean that one has to understand where the limits exist and where they don’t, both in personal and in societal terms, and at times, how to find another way to success.

And that’s something that Aaron Swartz  didn’t understand that and too many people, especially young people these days, also don’t seem to understand, perhaps because too many of their parents don’t either.

Standardized objective tests appear to have become the agreed-upon criteria for evaluating the “effectiveness” of teachers and schools in educating students. Regardless of all the rhetoric, it’s fairly clear that such tests are more or less accurate in measuring the retention of selected facts and skills.  What the tests don’t measure is the ability to think or the ability to integrate and employ a wide range of knowledge and skills in resolving problems or creating something.  Beyond those shortcomings, which are considerable in themselves, the widespread and growing use of such tests raises other questions.

These so-called objective tests, implemented on a wider and wider scale, also have additional negative impacts – on the students required to take them, the teachers whose performance is evaluated by their results, and on society itself.

Several of the impacts on students don’t even seem to be recognized by either the proponents or opponents of standardized testing.  The first impact is the creation of a mindset that there is indeed a simple and objective answer to every question and problem.  The second impact is that it conditions the students to confine their thoughts and abilities to the simplistic scope of the problem presented.  The tests and the teaching to those tests create a compartmentalization of learning. There is, in my mind, a definite correlation between the continued growth of standardized testing and the growing inability of students to apply skills learned in one area in another.  The third impact is that linguistic and logical skills are suffering, in that students seldom have to marshal facts and ideas and create a logical written or verbal presentation of those ideas – especially on the spot.  What ever happened to the class essay that developed that skill?  It’s gone, in most schools, and so are the skills.  A fourth outgrowth of these combined problems is that more and more students literally require detailed step-by-step directions to accomplish various tasks, to the point where a significant percentage of those students have lost the ability to follow general directions or to look beyond the obvious for answers.

As for the teachers… first off, the increasing use of standardized tests has reduced actual classroom instructional time.  A student isn’t learning when the student is taking tests.  The second problem for teachers is that, if the teacher doesn’t spend some time teaching the students how to take the tests, as well as teaching to the tests, the students will get lower scores and in the short run, that penalizes both the teacher and the students.  But such “teaching” further reduces the amount of time available for learning other material.  The third problem is that teaching for objective tests reduces the intellectual scope of the subject matter.  This, in turn, fosters simplistic explanations, and simplistic explanations certainly contribution to social and political polarization.

In turn, the growth of simplistics and social and political polarization impedes political consensus and thus makes resolution of political and government problems increasingly difficult and contributes to simplistic mechanical/technical and short term business practices.

And, of course, there is the failure to acknowledge that it’s virtually impossible to create a truly “objective” test or presentation of facts in the first place, and this creates an illusion of objectivity that doesn’t exist in the real world. So, by all means, keep expanding the use of objective testing so that students know more facts about even less, without even the ability to recognize that… and then claim success in “reforming” and improving education.

When doing some research for the previous blog, I came across a New York Times article that cited a very reputable survey [the General Social Survey] that released data showing that the percentage of U.S. households owning firearms has decreased from fifty percent to thirty five percent over the past forty years. Needless to say, the National Rifle Association and others disputed this finding, claiming that since the number of firearms held Americans has increased from something like two hundred million to over three hundred million, there was no way that the number of households holding firearms could have decreased.

And… both the GSS and the NRA happen to be right.  Why?  Because although the percentages are correct, the U.S. population has increased by more than thirty percent, and the number of households has almost doubled [families having fewer children and more single person households are why the percentage increases in population and number of households don’t correspond].  That means that eight million more households have firearms than in 1970, but that the total percentage of households having them is less, and interestingly enough the youngest households have the lowest percentage of firearms, well under thirty percent, while older Republican households have the highest percentage (which just might suggest that Republicans either have more to steal or worry more about it being stolen, if not both).

The same kinds of claims go on in advertising as well.  One truck manufacturer asserts that it has more trucks of a certain type on the road than any other manufacturer, proving durability, while its rival asserts that its trucks stay on the road longer.  The first manufacturer produces and sells more trucks so that in fact it does have more trucks on the road, but the second manufacturer’s trucks do last longer. Assuming the statistics are correct, it does suggest that the first manufacturer is misrepresenting the meaning of accurate facts.

Inflation is measured in a number of different ways, using everything from a Gross National Product (GNP) deflator to various forms of Consumer Price Indices.  In recent years, the government has also used a Core CPI, which excludes “highly volatile” goods, such as food and energy, on the grounds that these items distort overall price patterns.  That may be, but over the last twelve months the price of food has increased [according to BLS measurements] 1.6%, while energy prices have declined.  The problem, as I see it, is that overall food prices, over time, at least over the last seventy years, seldom decline, while energy prices are currently low because the economy is depressed.  As the economy recovers energy prices will rise, and food prices certainly won’t go down, especially given the drought still pervading many U.S. agricultural regions. Likewise, a number of politicians are proposing that Social Security Cost-of-Living Adjustments [COLA] be linked to a Chained CPI instead of the current CPI-W, on the grounds that the Chained CPI is more accurate.  It likely is, but that would mean that benefits would be decreased by some 3% over the next ten years, and three percent adds up to thousands of dollars for each beneficiary. The government is doing its best to present this proposed change in terms of increased “accuracy,” but it would mean Social Security benefits over time will be lower than they would have been.  Of course, opponents claim that the change cuts benefits, stopping there, and ignoring the fact that, over time, the system cannot pay those benefits unless the benefit levels are decreased or taxes are increased.

I could go on, but it all brings to mind the observation attributed to  Mark Twain Benjamin Disraeli:  “There are lies, damned lies, and statistics.”

The other day I was reflecting about various aspects of the world, and it dawned on me that I’d never seen, heard of, or read about a mob rioting in support of anything moderate.  Obvious as that may seem, every incident of mob violence deals with extremism or a reaction to extremism, especially if one especially if one considers hunger, discrimination, or civil repression of form of extremism.

But what lies behind that observation goes much farther than that. One of the greatest “mob” events in U.S. history was the Civil War, and it was generated because the states of the Confederacy insisted on the “right” to enslave other human beings, certainly an extremist belief and behavior. Not only that, but the New York riot in reaction to the first national draft, for the Union army, still ranks as one of the most violent in U.S. history. A great number of mobs and riots in recent U.S. history have also occurred as a reaction to perceived extremism, such as those that followed the death of Martin Luther King or the acquittal of the Los Angeles police officers who beat Rodney King.

Yet… there is a reason behind such “extremism,” and it seems fairly simple to me.  The most obvious example is that of the Civil War.  Slaves were property, and they represented a huge percentage of the wealth of the south.  Those who opposed the abolition of slavery felt that the federal government would confiscate their property – and they “rioted” to keep it, regardless of the ethics of enslaving human beings.  A huge percentage of the various civil rights riots in the United States, and more recently in France and elsewhere in Europe, resulted from resentment that the government and property owners were using their powers to economically oppress others in various ways.  Gun rights’ advocates fear government oppression, regulation, and confiscation – a loss of property and freedom.  Male extremist religious leaders violently dislike anything that will reduce their power – and increase the power of women and educated males, and this is certainly a factor behind anti-American mobs across the Middle East.

Extremism, of course, isn’t always exactly rational, either. Supporters of the individual right to own and bear arms have gotten consistently more violent and rabid in their assertions of those rights, and there’s been a lot of press about whether this represents a trend of some sort.  I’d venture that it does, but it’s not the kind of trend that I find particularly encouraging, not when the reaction is for gun supporters to start toting weapons everywhere and declaring that they’re under siege. Oh?  Despite all the political rhetoric, there are fewer restrictive gun laws today than in half a century, and yet we’re seeing a mob-type reaction to a few modest proposals on assault-type weapons and ammunition clip sizes…which may not even be enacted.

Abortion is another issue that generates great emotional reactions, and even though something like seventy percent of the American people believe that at least some form of abortion should be legal, those who oppose its legality create violent protests and have even murdered doctors.

Yet in most of these cases, those who struggle to keep their “rights” and “property” – or to gain them – seem to be in the position of asserting that their “rights” trump everyone else’s.  Property owners declare that they don’t want to sell to people of another ethnic group, even if the buyers meet their price.  Extremist gun owners seem to want the right to own and use pretty much any form of weapon ammunition or magazine that is available, despite the death toll on others.  Religious extremists insist that their views trump any other rights that might conflict with their views.  And the “civil rights” rioters think that their “grievances” allow them to trample all over the property rights of others.

It seems to me that a little more moderation on all sides would be in order, but then, that would be rational, and mobs don’t seem to form on a rational basis. I certainly don’t see any mobs forming to support moderation.  I wonder why not.

The Dow Jones recently surpassed its all-time high and has contined to climb, and the various other market indices are also near historic highs… and yet unemployment is still hovering just under eight percent; the real estate market in much of the United States is still languishing; economic growth is sluggish, to say the least; hiring hasn’t picked up much; there’s still been an inflation of percent over the past four years; and interest rates are at all-time lows [which is good for borrowing, and lousy for saving].

So why is the stock market roaring to new highs?

Because for anyone who is trying to save for the future there’s nowhere else to put the money without almost immediately losing some of its value.  If you put the money in a bank or under the mattress, it will lose almost two percent of its value every year… and for someone who might be trying to build up savings for a child’s college education or retirement, that’s not a pleasant thought.  Investing in bonds is even worse, because with interest rates as low as they are, bond values can only hold steady, if inflation remains low, or decrease in value drastically if inflation picks up.  Real estate is still depressed, and investing there is anything but flexible, since it’s hard to find buyers without taking a loss in the short-term, and it’s likely to be years before many markets recover.  But… many stocks do pay dividends, and the stock market has shown a remarkable recovery since 2008… so much so that many investment professionals worry that many stocks are now overpriced, but people keep buying.

Am I saying that the stock market will crash?

I’m not about to go out on that limb, not while the federal government is pouring billions of dollars into the various money and equity markets through quantitative easing (essentially a practice of buying financial assets to inject money into the economy and maintain the prices of those monetary assets)  and other indirect efforts.  So far, because of the comparatively depressed state of the economy, all that federal funding has not generated inflation, but it has given many professional money and fund managers the sense that the Federal Reserve will not permit any significant loss of value in those financial assets.

The question is just how long the Fed can keep doing this before the economy recovers enough for inflation to start increasing… and what will happen then?  Will the Fed be able to time the phase-out of QE so that we don’t have runaway inflation?  Or are we in a permanently depressed post-technological, high automation economy that will always require such monetary stimulation?  Or… has so much money been poured into the economy that a future runaway inflation is almost impossible to avoid?

As some readers may know, I was trained as an economist, and worked as one for a time, and I do follow financial trends fairly closely.  So do many others, many of them far more skilled than I am, but whether many of them will admit it or not, we all have great concerns about the long-term implications of this policy.  The problem, of course, is that without the Fed’s intervention, we’d still be mired in what would have turned into a second Great Depression – but then, if the Congress hadn’t totally deregulated the financial sector, we might not have been in such a huge mess in the first place.  In any case, what’s done is done, and we have to deal, as we can, with what lies ahead.

First, that means recognizing that the various stock market indicators are far more indicative of the fact that the other “investment” opportunities are currently only opportunities, in general, to lose money, although there are always some good opportunities in any sector, and that the equities market is the only place in the world where large sums of money can be invested with any hope of a positive rate of return… at least, for now.  But the market indices do not indicate robust economic health, and are, in some respects, more of an indication of desperation on the part of investors.

And that concerns me… especially since I – and many others – don’t see any viable alternatives, almost a damned if you do and damned if you don’t situation… and one which the politicians are studiously ignoring.  But then, that’s what politicians do best.