It’s been a while since I struggled to understand division. It was third grade, if I’m recalling correctly, when I’d come trudging home from Timberlane Elementary School with a backpack full of math worksheets requiring me to do exciting things like divide 567 by 32, rounding up to the tens place.
Once you knew your times tables, it wasn’t so hard, but it took a while to get there, bludgeoning my way through exercise after exercise until I finally got it.
I had a peculiarly similar experience a few months ago, as in my fifty-seventh year of life I finally realized I had no idea how the Dow Jones Industrial Average actually worked. I peruse the business news daily, and for years thought I had the basic principle down. The Dow, which is used to measure the economic health of a nation, is a number you get to by adding together the dollar value of common stock in thirty selected blue chip companies. That gives you the dividend/numerator. This, you divide by a divisor/denominator….in this case, 30…to get an average. Because, you know, that’s how averages work, or so I remember from later in elementary school. That measure of economic health has risen meteorically in my lifetime, going from 800 in 1969 to over 50,000 now. For a long time, I assumed the soaring DOW had to do with two factors: 1) that stocks were gaining value and 2) that the dollar was losing value through inflation.
But I was wrong.
That’s not how it works. Not at all. I was right about the dividend, but clueless about the divisor. When the DOW began, the divisor was the number of stocks in the average. But the folks who run the Dow have gradually adjusted that divisor downwards over the last 75 years, to create a narrative of “continuity.” So instead of dividing by thirty, which would give you an actual average, or by 1, as was the case in 1987, the year I graduated from high school, you now divide by point one six.
I had a peculiarly similar experience a few months ago, as in my fifty-seventh year of life I finally realized I had no idea how the Dow Jones Industrial Average actually worked. I peruse the business news daily, and for years thought I had the basic principle down. The Dow, which is used to measure the economic health of a nation, is a number you get to by adding together the dollar value of common stock in thirty selected blue chip companies. That gives you the dividend/numerator. This, you divide by a divisor/denominator….in this case, 30…to get an average. Because, you know, that’s how averages work, or so I remember from later in elementary school. That measure of economic health has risen meteorically in my lifetime, going from 800 in 1969 to over 50,000 now. For a long time, I assumed the soaring DOW had to do with two factors: 1) that stocks were gaining value and 2) that the dollar was losing value through inflation.
But I was wrong.
That’s not how it works. Not at all. I was right about the dividend, but clueless about the divisor. When the DOW began, the divisor was the number of stocks in the average. But the folks who run the Dow have gradually adjusted that divisor downwards over the last 75 years, to create a narrative of “continuity.” So instead of dividing by thirty, which would give you an actual average, or by 1, as was the case in 1987, the year I graduated from high school, you now divide by point one six.
Point one six.
And when you divide by a number that’s less than one, what happens? All of a sudden, you’re multiplying!
This, conveniently enough, gives us the story of endless growth.
And when you divide by a number that’s less than one, what happens? All of a sudden, you’re multiplying!
This, conveniently enough, gives us the story of endless growth.
Growth, as any parent or gardener can tell you, is a fundamental part of life. That’s the core narrative of our economic culture, that things must always be more and be better and bigger and more powerful. It’s what we’re taught to revere, taught to value, and it’s the story that defines whether our lives have worth or our lives do not. It is the defining moral purpose of the culture that birthed us, and in which our identities are formed and shaped.
It’s fiercely seductive, and I’m not immune to the siren song of bright and shiny things.
But that story of ever rising power and wealth isn’t entirely true. What is the DJIA but Standard and Poors telling the tale of a government that prints more and more money, and businesses that print more and more stocks to absorb that new money into the portfolios of the privileged?
It’s fiercely seductive, and I’m not immune to the siren song of bright and shiny things.
But that story of ever rising power and wealth isn’t entirely true. What is the DJIA but Standard and Poors telling the tale of a government that prints more and more money, and businesses that print more and more stocks to absorb that new money into the portfolios of the privileged?
More notably, for those of us who follow Jesus, how much does Mammon's peculiarly self-serving mathematics shape how we live out our lives as disciples?
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