I also realize now that I was misunderstanding the pessimistic operator. Saying 
```ruby
gem 'Rails', '~>3.2'
```
I, believe, means update up to, but not including, Rails 4.0. In other words, Rails 3.6.5 is open to an update as much as rails 3.2.16, but we'd never upgrade to Rails 4.0 with that in our Gemfile.

By using what we have in the Gemfile now:
```ruby
gem 'Rails', '~>3.2.11'
```
we're saying, update to anything within the 3.2 range, but not to Rails 3.3 if that becomes available. For some reason I'm having a challenge properly understanding this even after reading the documentation. Sorry for the previous confused comment. Especially to Jon, who clearly has a better understanding of these things than I do!