Economic Illiteracy: Bad For Our Country and Our Children

July 5, 2013

I don’t just think about education because among other things, I am an economics and business teacher.  I teach. I was reading the Preface of Common Sense Economics (Revised and Updated) by Gwartney, Stroup, et al.  As an educator I had to stop and re-read this passage from the book:

“The massive government intervention leading up to, and following, the economic crisis of 2008 has generated an increasingly urgent need for basic economic education.  Our democracy puts voters in charge of choosing our policy makers, so the consequences of economic illiteracy can be disastrous.  People who do not understand the sources of economic prosperity are susceptible to schemes that undermine both their own prosperity and that of their country.  A nation of economic illiterates is unlikely to remain prosperous for very long.”

There are various forms of illiteracy and innumeracy, but I have to agree with the authors that a “nation of economic illiterates is unlikely to remain prosperous for very long.”  

I’ve been using the Handy Dandy Guide to Economics for years, which contains six main principles that help explain economics, economic forces, and economic decision-making.  (There are many versions on the Internet, here’s one simple one.)

The authors of Common Sense Economics have developed ‘Twelve Key Elements of Economics” and “Seven Major Sources of Economic Progress”, and both are quite good.  They also developed “Twelve Key Elements of Practical Personal Finance”, and I thought I’d share the last point on that list with you:

“12. Teach your children how to earn money and spend it wisely.”

They write:  

“General well-being and financial success tend to go together, and the connection is not accidental.  Those who develop the habits of working diligently, setting goals and achieving them, and avoid the temptations of instant gratification by considering the future consequences of current choices are typically more successful in all walks of life than those who don’t.”

OK, I get it.

  1. Economic literacy is important because a “nation of economic illiterates is unlikely to remain prosperous for very long.”   
  2. We should “teach our children how to earn money and spend it wisely,” for their “general well-being and financial success.”  

Two more reason why I teach my business seminars and why I think about education!

Posted by marks on Friday July 5, 2013 at 03:14PM

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