- The Washington Times - Tuesday, July 8, 2003

NEW ORLEANS — It’s basic economics: The supply of students who know much about money is woefully scarce, driving a demand for schools to do more — fast.

Alan Greenspan, a man who can make markets move in a few words, is among those campaigning for students to improve their fundamental money skills. Trouble is, many students have no idea who the Federal Reserve chairman is or what he does.

The list goes on: saving, investing, borrowing, prioritizing, managing debt, scrutinizing contracts. Before students leave high school, they must be ready to make sense of dollars in many ways, but such economic training is hardly common.

Only four states require students to take a course in personal finance in order to graduate high school, according to a 2003 survey by the nonprofit National Council on Economic Education. Fourteen states require a course in economics.

The upshot? In the short term, students fail to save; they rack up debt and sign service contracts they don’t understand. Over time, the problem gets deeper, with bankruptcies, home foreclosures, financial stress that divides families.

“We haven’t taught them how to be good consumers,” said teacher Jan McCarthy, who includes money lessons in her government classes in Irmo, S.C. “We haven’t taught them to be critical of what they see, and we haven’t taught them delayed gratification. It’s all instant gratification. That’s what TV ads tell them.”

Teachers at the National Education Association annual meeting spoke about students’ financial-literacy woes in a group interview with the Associated Press.

High school seniors last year flunked a survey of basic financial knowledge. For example, most students — 78 percent — thought a U.S. savings bond or a savings account would offer the highest growth over 18 years of investing for a child’s education. Fewer than two in 10 gave the correct answer, stocks.

“I don’t think there’s educational disagreement about this problem,” said Dean Breuer, a school-technology coordinator and former business teacher in Richfield, Minn. “The solution is to teach it. But when you’ve got a lack of resources, when you have more requirements from everything else, how do you fit it in?”

Indeed, teachers say they’re up against their own supply-and-demand dilemma.

Budget cuts have forced some districts to shift money and teachers from other areas into reading and math. That highlights another problem, educators say — economic training is seen as an extra.

“The trick is to get it into the curriculum into otherareas such as social studies, math, geography, history. We think you can’t talk about the Boston Tea Party unlessyou make some reference to taxation,” said RobertDuvall, president and chief executive officer of the National Council on Economic Education.

Pablo Martinez, who teaches government and economics at an alternative high school in Roswell, N.M., said such training should start by grade six.

“My students have two strikes against them already,” he said. “If they go into the world and they’ve got these problems spending their money, they’re doomed.”

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