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Children Must Learn About Economic World
by

This first appeared in the
North Hills News Record

When I was in school, there were three subjects that proper etiquette deemed inappropriate to discuss in public: sex, religion and money. Today, children start ‘reproductive health education' in the early grades of elementary school and as long as it isn't of the Judeo-Christian variety, even religion is explored. Money, however, is still taboo.

**Test Your Economic Literacy**
1. When a person rents an apartment, who benefits from the transaction?
a. Only the person renting the apartment
b. Only the landlord
c. Both the person renting the apartment and the landlord
d. Don't know
2. An increase from 5% to 8% in the interest rates charged by banks would most likely encourage:
a. Businesses to invest
b. People to purchase housing
c. People to save money
d. Don't know
3. If your city government sets a maximum amount landlords can charge in rent, what is the most likely result?
a. There will be more apartments available than want to rent
b. There will be fewer apartments available than want to rent
c. The number of apartments available will be equal to the number of people who want to rent
d. Don't know
4. Which of the following are most likely to be helped by inflation?
a. People living on fixed incomes
b. People who borrowed money at a fixed rate of interest
c. Banks that loaned money at a fixed rate of interest
d. Don't know
5. When the federal government's yearly expenditures are greater than its revenue for the year, the difference is known as:
a. The national debt
b. The budget deficit
c. A budget surplus
d. Don't know
Answers: 1) c 2) c 3) b 4) b 5) b

I've never understood why. In my family, discussing money and learning about economic issues simply was a part of growing-up. Experience tells me though we were the exception to the rule.

The irony is that most adults adamantly insist they do understand economic issues and they'll rant and rave to defend their viewpoints even though they know precious little about the subject.

A recent national survey of adults and high school students commissioned by the National Council on Economic Education, funded by Merrill Lynch and conducted by Louis Harris & Associates, revealed that we are a nation of economic illiterates. (In full disclosure, I am a consultant for the Pennsylvania affiliate of the NCEE.)

The poll found that nearly two-thirds of the surveyed young people and half of the adults flunked a basic test of economic literacy. Why does that matter? Because being economically illiterate is almost as much of a handicap as not being able to read.

A quick summary of the weekly news proves my point.

A N.Y. architect suggests an alternative to Fifth and Forbes plan. AT&T will begin offering local phone service. Pennsylvania merchants can no longer exempt Bibles from the state's 6 percent sales tax. The U.N. claims the world's population is now racing toward 7 billion. President Clinton designates many federal forests as permanently off-limits to logging, mining and other development. The Pittsburgh Pirates request the removal of a boathouse.

Every one of these news items is an economic issue and we're bombarded with them every day. If people haven't learned basic economic concepts, they will end up making important decisions based on chance and irrational feelings.

It may seem ignoble or too worldly to teach our children about economic issues. But economics is the real world. No matter what road they take in life, our children will be active participants in the economy. We've waited far too long to completely abolish the last taboo.