I once had a professor who divided humanity into three groups. Group One was made up of people who didn’t think at all. In his sort of elitist view of things, this group made up the majority of the human race. Group Two was those people whose heads were full of facts, but the facts were scattered all over the place in kind of a junkyard. Group Three consisted of those people who had lots of facts and knowledge and had it organized in a useful way. Needless to say, Group Three is the place to be.

We can make the same kind of distinctions about the ways in which people use – or don’t use – basic assumptions. Here there are at least four groups. The first pretty much corresponds to my old professor’s non-thinkers. They are totally unaware of the assumptions that underpin their actions. Their biggest non-assumption is that tomorrow is going to be pretty much like today. People in this group tend to go through life experiencing unpleasant surprises because tomorrow is often different from today.

In Group Two are those people who make assumptions but fail to test them. Here is an example from today’s headlines. A well-off writer employed a cleaning lady who came to his house each week. One day, she informed the writer that she had just purchased a house. He congratulated her on becoming a first-time homeowner. "Oh no," she said, "I own five houses."

There were two sets of assumptions at work here. Hers, totally unexamined, that the price of houses would keep going up for the first time in the history of the world, and that she would become rich and not have to clean houses anymore. And his, thoroughly examined, that, if the cleaning lady was buying and flipping houses, the end was in sight, and it was apocalypse pretty soon. She is still cleaning houses and seeking to dig out of debt from foreclosure and bankruptcy, while he is seen to have been a prophet before his time and protected his investments.

Our writer is in Group Three: those who examine underlying assumptions, test them thoroughly and act on their conclusions. This group is successful because it is then able to link its tested assumptions to useable information and achieve its goals.

Then there is the fourth group, in some ways the most problematic. It is the group that tests assumptions and then proceeds down a path that the tested assumptions say will not work, usually because it never has in the past. Hey, there is always a first time, right? As the authors of "This Time is Different: Eight Centuries of Financial Folly" point out, Wrong. In the book’s preface, they state, “Our basic message is simple: We have been here before …. If there is one common theme in the vast range of crises we consider in this book, it is that excessive debt accumulation, whether it be by governments, banks, corporations or consumers, often poses greater systemic risks than it seems during a boom.”

Many in Group Four, especially those at the top of the income pyramid, ignored these assumptions and did very well in the process. Now they are at it again, and, if successful, will do even further damage to our country. But those who didn’t do so well would be strongly advised to rethink a lot of our basic assumptions.

For the Virgin Islands, here is kind of a starter kit of basic assumptions worth testing:

♣ The territory is at the front end, the middle or the tail end of the economic downturn. Take your pick and explain your assumption including the downturn’s impact on the local economy.
♣ The U.S. Virgin Islands’ economic model – high government employment at low salaries and low productivity – is sustainable over the long run.
♣ The poor performance of the territory’s educational system is acceptable or in need of significant change. The system’s top priority is educating children, rather than serving as a jobs program or meeting some other needs.
♣ The territory’s tourism strategy and the structure of the industry are optimal in an increasingly competitive environment.
♣ The not-for-profit sector will survive the current downturn relatively intact.
♣ Virgin Islanders are capable of pulling together to confront difficult realities and make the changes that are needed to insure a better future. Or, alternatively, we do not have to pull together and don’t have to make changes.

Honestly testing assumptions is especially difficult in hard economic times. All too often the answers make us face painful choices. If there is an obvious outcome of testing assumptions, it is an action plan for change, and lots of times we don’t like the actions that have to be taken.

While the Virgin Islands and the U.S. mainland are out of sync in many ways, they share a common refusal to confront realities and make changes that impose short-term costs in exchange for long-term benefits. In his 1961 inaugural address, President Kennedy said of his fellow Americans, “We shall pay any price, bear any burden, meet any hardship ….” Half a century later, is it fair to say of many Virgin Islanders and their mainland compatriots that “we shall pay no price, bear no burdens and endure no hardships except those that are imposed on us by our own inaction and refusal to change?”
Now there is an assumption to be tested.

Frank Schneiger