The Importance of Economic Education
The state of things today, with COVID-19 closures wreaking havoc on the economy, provides ample evidence of why it’s important to understand economics. We are seeing shortages of ventilators, hospital beds, toilet paper and other items. These are scarcity problems and we will likely have to make some very tough allocation decisions. The Fed is enacting monetary policy, reducing interest rates to zero and injecting $1.5 trillion into the short term money markets (quantitative easing). Congress and the executive branch just passed a stimulus package, mailing each American adult a check. What does this mean for the deficit and debt? Sectors of the economy are temporarily shutting down which will affect GDP and very likely result in a recession. THESE ARE ALL ECONOMIC ISSUES. We must ensure all citizens get some basic economic education. It is paramount to understanding the world, and democratic republic, in which we live.
Economic literacy is vital to the health of our economy and can help prepare students for their economic roles as productive workers, informed consumer and savers, involved citizens, and lifelong decision makers in an interdependent world. If the United States is to maintain its position as a leader in the global economy, we must continue to prepare our students for economic realities that continue to evolve as nations become more and more interconnected.
Equipping students with a sound understanding of basic economic principles will empower them to make a lifetime of informed decisions and will help build healthy communities where they reside. By dedicating time in the school day for economic literacy, we are helping students become better decision makers and more able to thoroughly understand the ramifications of a myriad of economic factors impacting their daily lives. Economic literacy holds the key to living productive lives and is essential for our economy to function at its fullest levels of productivity while maintaining its competitive advantages.
George Stigler, 1982 Nobel Laureate in economics, probably stated it best when he said: "The public has chosen to speak and vote on economic problems, so the only open question is how intelligently it speaks and votes." Ultimately, economics is the science of decision making. As adult decision makers and leaders in our state, it is our responsibility to ensure every K-12 student has a basic understanding of economics.