At Large: Sweet dreams and planning

Perhaps you’ve heard of the quants. The word derives from quantitative analysis, whatever that is. But quants, as the term is used these days, are people, really smart people – though, as it turns out, not smart enough.

Scott Patterson, a Wall Street Journal reporter, explains, in a book published earlier this year, what the quants did to contribute to the financial collapse of late 2007-2008. A column, written by Patterson and published in January in the Journal, is headlined “The Minds Behind the Meltdown: How a swashbuckling breed of mathematicians and computer scientists nearly destroyed Wall Street.”

Late in the summer of 2007, the quants’ models, beyond comprehension to ordinary mortals, began to misfire. The bosses and board members who employed the quants to calculate the risks and prices of certain market bets didn’t understand the models any better than you or I might have. But, they went along anyway.

Startlingly, stocks that the models said would go down went up, and the other way around. The bets were made both ways. Something was happening that the quants had not divined and built into their computer models.

“The fine-tuned models,” Patterson writes, “the bell curves and random walks, the calibrated correlations — all the math and science that had propelled the quants to the pinnacle of Wall Street — couldn’t capture what was happening.” It turned out that some variables had not been accounted for in the quants’ models, because in fact they hadn’t been imagined or foreseen or recognized by the model builders.

But actually, this column isn’t about the economic catastrophe in whose long shadow we now live and may for some time, or the math geniuses who helped exacerbate it. And, on the chance that it may have occurred to you, it isn’t about the climate models we’ve heard so much about, the ones built by whizzer scientist, climatologist quants who forecast the global temperatures 100 years out and tell us the only way to save the world is to ride a bicycle to work. And, of course, it isn’t about the Congressional Budget Office predictions about the effect of this law or that one on the national deficit a decade or two down the road, always hedged by bets on whether Congress three or five years hence will follow through with necessary spending restraint.

No, it’s about planning for the community that we, today, would like to design and control 50 years hence. It’s about colossal presumption. It’s about sweet dreams. It’s about prohibiting future change that would discomfit us and claiming that Islanders two generations hence will want what we have wrought. It’s about confining the future, rather than encouraging all that the unknowable, as yet unimagined, future might be.

The small cell of Islanders and summer Islanders who contributed to the Martha’s Vineyard Commission’s Island plan were not a swashbuckling breed, in any respect. Rather, they were defenders of the castle. They were sober, discursive, and regressive. They liked what they see around them – at least for the most part. What they like, they want to persist. What they don’t, they want to prevent. The long-term planning effort became a means to their ends.

This collective planning dream, extending its inflexible reach half a century into the future, has a sad correlative in the affordable housing dream. The latter imagines that fitting out a handful of low-income Islanders — whose skills and services we need — with houses they need may be accomplished without discomfiting ourselves with higher density or architecture that departs from what we, collectively, admire. It concludes that although it will take a toll on the future prospects of these housing beneficiaries, footing the bill with taxpayer funds or private donations will keep control of change in the hands of the legacy property owners among us, even unto requiring that an affordable housing recipient family must remain low-income qualified, in order to continue to dwell in a house they have built.

This is an agenda in which the means, because they are in our hands, will ultimately satisfy our ends.

But, to attract, keep, and nourish new Islanders — the neighbors we need to nourish a real community — there must be vigorous, steady, economic growth. If there must be restraints on one sort of growth, then there must be significant, realistic encouragement of other sorts of growth, so that the population enlarges, the housing stock grows, businesses grow, and jobs grow in number and value. This is an agenda that anticipates and embraces growth and change, and builds upon a working acknowledgement that in planning ahead, there will always be variables unaccounted for. But, unlike our experience at the hands of the quants, there is a virtue in the kind of unplanned-for variability I’m talking about. It will allow newcomers to find their way to the Vineyard, become neighbors, and go on to make better lives for themselves and us, according to their lights, not ours.