Monday, July 21, 2008

Colleges are failing their students in economic literacy

College is supposed to teach some life skills to students apart from their major, like critical thinking, a general understanding of the world they live in, an appreciation of others and how to function like an adult citizen in our society. Part of this is some general understanding of Economics. This includes foreseeing the consequences of economic actions, understanding the role of interest and debt.

Obviously, many Americans are not very good with the concept of debt and savings. But one could think this pertains to uneducated people. Not so apparently, according to an article in the Business Week that even claims that universities team up with credit card companies in trying to lure students into shady contracts. So much for leading by example.

Given that many universities cannot sustain themselves from tuition and state grants, I fully understand that they are looking into alternative sources of funding. One important source is alumni contributions, but screwing alumni like this is no long term solution. Much better would be to actually teach them to understand basic money management skills. They be more successful in life for it, and more grateful.

4 comments:

Byron 1776 said...

Except for the University of Chicago. Economics is almost a varsity sport there!

byron1776.blogspot.com

Vilfredo said...

For once, I disagree. I do not think it is the role of college to teach people how to balance a checkbook. That should be learned earlier and not reserved to college grads.

But colleges should not screw their students and alumni by shoving them such credit scams either.

Anonymous said...

Why would they want to eductae their students on economics? All that could possibly come of it is driving tuition down.

debtfree former student said...

Economic literate students would understand that is OK to be in debt. This is just a life cycle thing where you borrow against future income. But they should also understand that borrowing through credit cards is not the way to go.

And anonymous: one consequence of my argument above is that students would be willing to go more into debt and universities could charge more tuition, not less. Economic literacy does not mean being debt free at all cost...