I'm taking this week's message from my little 2013 book. I'm thinking this essay I penned back in 2010 and featured in Leaving Liberty? is once again timely...
Brains to Burn
In their book Freakonomics, the rather curious duo of Steven Levitt, an economist, and Stephen Dubner, a journalist, tell us “why conventional wisdom is so often wrong. How ‘experts’ bend the facts. Why knowing what to measure, and how to measure it, is the key to understanding modern life.” They pose, then unravel, a number of life’s great mysteries, including why drug dealers still live with their mothers, what sumo wrestlers and schoolteachers have in common, and whether children reared in homes with more books do better in school than children who come from homes without books. I personally have been contemplating writing an essay titled, “What Do Drug Dealers and Politicians Have In Common?” but I’ll save that for another day.
I found the childhood aptitude study particularly fascinating. As it turns out, there exists a definite correlation between books in the home and children’s test results— the more the books, the better the scores. What’s fascinating is that whether or not the kids with the books ever crack one has absolutely nothing to do with anything. In fact, in the featured example, the book-rich kid, who scored the highest, never read any— while the bookless child, who scored the lowest, spent every afternoon at the library reading voraciously. So what gives? Well, I hate to say it, but, according to the authors, it’s all about genetics. The fact is that homes with crammed bookshelves tend to house parents with crammed craniums. And a high IQ, they conclude, is a function of breeding, as opposed to parenting— that is, a child’s capacity for test-taking hinges on her genes, not her thirst, or lack thereof, for learning.
The good news is that those of us who lack PhD-worthy (without monumental effort) quotients need not fret over our genetically compromised youngsters. For, contrary to what I’m certain the genius parents themselves think, there exists no correlation between a 4.0 GPA and ultimate success in life. I might go so far as to argue that the child who has to strain to keep up stands to develop a work ethic that would contribute substantially more to his or her prospects for later success, versus that of the genetically endowed child to whom things come easy. Sounds good anyway.
You name him/ her: Alan Greenspan, Ben Bernanke, Lawrence Summers, Christine Romer, Austin Goolsby, and so on. If there’s one constant among the individuals who’ve been appointed to either rule monetary policy (as in the case of Fedheads Bernanke and Greenspan) or advise our leaders on fiscal policy (Summers, Romer, and Goolsby), it’s that they’re all off the bloody charts when it comes to IQs. Just Google any one of these names and you’ll see academic achievements that’ll blow your easily boggled mind— they were simply born with brains to burn. And thus, whenever I’m inclined to critique one of these geniuses, given my academic dearth, I stop and ask myself, “How can I even pretend to criticize an individual whose intellect easily runs circles around mine?” But then again, if academic prowess is all Washington needs to make sound financial policy, how do we find ourselves facing a 1.4 + trillion dollar budget deficit come 2011? My business ain’t runnin no deficit.
Here’s the thing: the economy is cyclical, and all the brainiacs on the planet can’t do anything about it. The Fed, for example, has a mandate of full employment and price stability, which doesn’t leave much room for cyclicality. And besides, aren’t the two mutually exclusive? Think about it. When we fall below full employment, the Fed increases money supply, which puts upward pressure on prices. And full employment in and of itself connotes higher demand, which puts upward pressure on prices. And if working against naturally occurring economic winds isn’t tough enough, consider the fact that the Fed (and for political reasons they’ll never admit this) is constantly having to counterbalance the vagaries of today’s tax-happy (and spendthrift) politician.
The sad thing is, we average-IQ’d consumers, knowing our limitations, blindly accept certain notions proffered by these appointed geniuses. We’ll even sympathize (whether we understand it or not) with a given position, particularly when it supports (or so we’ve been lead to believe) us individually or the particular industry we work in.