The six children sit together at the waterline in roaring wind. Seagulls dip and strain, beating their wings against the gusts as, far below, waves crest, thump, whisper. A girl, scarcely three years old, stands suddenly and looks out towards that horizon. Striding past them in the distance, his immense feet hidden beneath the rim of the horizon, is a giant.

American artist NC Wyeth painted The Giant in 1923. The low angle emphasises the giant’s immensity, and all the children’s faces are turned away from the viewer. In this way, those children become anyone we care to transpose into this magical scene. What child has not lain in the grass to watch some cloud-image, an animal perhaps, gradually dissolve into the amorphous collection of water droplets that are its banal reality?

Why has Wyeth instilled this sense of nostalgic impermanence into his painting about imagination?

Almost every corner of western society views imagination as the domain of early childhood, those fleeting years when giants made of cloud seem possible. This explains why the word “imagination” disappears from Victorian education department curriculum documents well before children reach high school – not that it appears much prior to that.

Worse, most of us know instinctively that, in many adult contexts, the word’s connotations are at best ambivalent and at worst outright negative. Even being labelled a “dreamer” is rarely a compliment; when we laugh that something might happen only “in one’s dreams”, we seem to be mocking not only an individual’s hopes, but their time spent building such imaginative constructions in the first place.

All this language and associated behaviour is an ostensibly pragmatic attempt to wrench people back to direct engagement with what western society views as “the real” and thus – far more importantly – the useful.

The truth is that all very young children do have rich imaginations and navigate rich imaginative worlds. However, almost all will lose this faculty by their mid-teens, or have it dimmed nearly out of existence.

This is something that is accepted and largely unquestioned in our culture, as though loss of imagination is an inevitability of growing up. Through this lens, imagination becomes associated with immaturity.

Let me be unambiguous: this is one of the greatest invisible tragedies in the lives of children. And it carries them into adult lives of squandered potential, or worse.

But this loss need not be inevitable. We can sustain and develop the imaginations of young people, and doing so will empower and even protect them in profound and transformative ways. Imagination can be both life-changing and life-saving.

Today, true imagination – that is, untethered dreaming for the nourishment of the self – has become a radical act, as radical as trespass; as radical as refusing to follow the prescriptive criteria we are expected to apply to so many areas of our lives. But this isn’t just a problem for teachers. It is also a problem for parents, and anybody seeking to explore the potential of their own lives in adulthood.

The reasons for the deprioritisation of imagination in western culture almost don’t matter. It may be that, in an industrialised society, imagination of this kind isn’t seen to serve capitalist needs. This could be why educators like myself have embraced notions of “creativity” with such unconscious passion. Dreaming may not lead to productivity, and a dreamer may not “achieve” anything by the judgement of those conditioned by today’s economic priorities, but create-ivity has it built into its very name – a creator at least has something to show for their efforts … and perhaps something to hand over. There is no sense that imagining can be a powerful end in itself.

To create implies external expectations (create for), especially in an educational context, and as soon as there are expectations, true imaginative freedom – the freedom to dream – begins to fade.

At a time when I was very young and perhaps the most vulnerable I have ever been, my grandfather invited me to dream about the smooth stones in his rock garden. But he never had any expectations or demands. I never had to find a better rock or attach a more convincing narrative to my latest discovery. It wasn’t for him, and this was something he instinctively understood. We could call what we were doing play, just as we could describe the children on Wyeth’s beach as playing, but it’s much more than that. Even the word “play” trivialises and even condescends the deep, rich profundity of imaginative dreaming.

When my daughter discusses fairies, I do not see this as play, although I’m sure she finds it to be a great deal of fun. Instead, I feel that she is doing something vital, not just developmentally but in terms of how she might live the rest of her life – that is, as a person enthralled by wonder, possibility, impossibility, and open to all the joys such things offer.

To invite children into an activity free of demands is to face the adult anxiety of those children achieving nothing. In contemporary education especially, the need for students to create products and demonstrate measurable skills is predicated on the belief that we can only know that a child has developed if we are able to gather objective data. Were we to say, “Those children benefited from imagining a giant in the sky,” a modern educator (myself included) might be tempted to counter: “What data do you have to support that?”

An English teacher like myself may want the children to write about what they saw so I could compare that writing with their past work assessed against similar criteria. An art teacher might ask them to paint their memory. In the paradigm of modern education, the demand for a product, an assessment item, data, quickly manifests.

As teachers, we have an almost pathological need to observe both the process and the product of student learning and this means that all children have an adult at their shoulder at all times. The result of this, of course, is an anxious self-consciousness and second-guessing of what the assessor wants, something most apparent in the senior years but evident at all levels of schooling.

With the introduction of criteria to assess any of the create-ivity emerging from the students’ closely surveilled efforts, we have perhaps the most stifling and sanitised imaginative space conceivable. Write a story, but it must follow the conventions of science fiction. Write a poem, but it must employ the poetic style of Emily Dickinson. Write a paragraph, but it must begin with a topic sentence. Must. Instruction; structure; walls and barriers and limits.

Teachers like myself are so focused on the power of criteria to guide students that we almost never acknowledge the absolutely unavoidable reality that every criteria has a shadow criteria, that which implies all the infinite things the students cannot do. In some sense, criteria are imagination’s opposite, its antonym. Give us what we want. Imagination blotted out by insistence on a specific product demanded by an authority figure. All the freedom of water poured into a concrete aqueduct. Learn the rules so you can break them? Only if the rules don’t break you first.

All of this is clearly antithetical to what it is to dream.

I do not believe criteria should be dispensed with entirely. There are many situations when clear criteria sheets offer value to children by explicitly showing them where they are at and how they can progress. But if we apply criteria to everything, imagination is stunted. And we aren’t just preventing its growth. We may actually be destroying what’s there, nascent or not. We may actually be doing harm.

Any teacher knows that the most driven, successful and passionately engaged students have been able to imagine themselves – dream themselves – into their goals from a young age, and have not allowed the strictures of modern education to dull the glittering worlds existing within their minds. When a 12-year-old tells you she wants to be an archaeologist, she isn’t thinking about the profession in an academic or abstract way: she is feeling the hot sand on her face, seeing the pyramids rise against a sky so blue it seems never to have felt the brush of clouds; she is envisioning the creaking mysteries of sarcophagi firelit in aeons-darkened tombs. She is there.

Impossibly, we as a culture seem to have forgotten this. Most painful of all, teachers seem to have forgotten it. Without imagination, speculative possibilities, from the most wild to the most pedestrian, wilt.

In a very real sense, loss of imagination is by definition a loss of hope.

• This is an edited extract from Childhood by Brendan James Murray (Picador Australia)