Financial Literary Bailout for the Younger Generation
Hanover, NH-June 2, 2010-In the aftermath of the global financial crisis,
financial literacy is still low among young adults. According to a new study
published in the Journal of Consumer Affairs, only twenty-seven percent of people aged 23-28 can answer three basic questions about interest rates, inflation, and risk diversification, and other basic financial concepts. Furthermore, this result was amplified when studying the answers of young women, African-Americans, and Hispanics, and those with low educational attainment.
The research, headed by Dr. Annamaria Lusardi, shows that financial literacy
is largely influenced by parental education levels and financial habits.
Lusardi says, "If we do not address financial illiteracy among young people
through high school literacy classes, we will fail to equip young people
with the tools they need to make financial decisions, and we may pay the
cost down the road. Not everybody has an opportunity to learn from their
parents or their friends. Young people at the start of their career, or who
are in the process of buying their first home need to be financially
knowledgeable before they engage in financial contracts."
It is the final paragraph that is most interesting. It is a fascinating example of the sort of thing I teach in my sociology of education course: the ideology of individualism focuses our attention on the individual and blinds us (well, average Americans, anyway) to the true structural problems. What we see here is the structural problems of capitalist economy, and specifically the recent economic collapse due to unregulated sub-prime market etc, translated into the individual consumer's fault! If only consumers were better educated, there would not have been the problem! It is a wonderful example of 'blaming the victim'!
And the solutions to economic problems -- education! Great how problems in the economy caused by bad (unethical) business decisions suddenly become the fault of consumers and the 'failed' education system.....