Remarks by Robert F. Duvall
I am pleased and honored to be a participant in the Global Summit on Financial Literacy.
And what a vital, opportune, and necessary time to be addressing this issue!
Financial literacy, achieved through education, is a most important topic to each of us as individuals, as parents, as members of families and communities, as responsible global citizens. It is critically important today for the future of our children – and the present and future of our world.
Clearly, economic and financial illiteracy has become a front-page issue. There is a national and indeed worldwide climate of concern.
We are in a complex globally interconnected financial crisis. And everyone is asking, “Why and how did this happen? And what can we do in the crisis for ourselves and families?” I certainly do not have the answer!
But at the Council for Economic Education, we realize that economic and financial literacy, or the lack of it, directly affects all of us – our quality of life and our future security – and, every day, we ask ourselves:
- How can we make a difference?
- How can we seize the opportunity to extend our reach and deepen our impact?
Like the real estate people who say, it’s all location, location, location, we believe the answer to those questions is education, education, education – to improve economic and financial literacy.
Essentially, the Council for Economic Education is focused on teaching -- teaching our children, and, indeed, all our citizens the basic concepts of economics and personal financial decision making – that is, the skill set; the tool kit – that they can use in their lives, all their lives.
Many of you I am sure are involved, directly or indirectly, with financial literacy programs to help educate on how to plan and budget, manage risk, handle credit and debt, and plan for retirement. But what programs are working? What is the impact that financial education programs have had on the public?
Those are complicated questions. In this field, at least a 1000 flowers are blooming. Let me offer two examples from what I know first-hand – that is, from the work of the Council, as well as from being a member of the U.S. President’s Advisory Council on Financial Literacy, to see if we may draw out some factors which make initiatives that work, work.
1. Learning, Earning and Investing
Learning, Earning and Investing is a secondary school curriculum developed by NCEE and designed to introduce students to the world of investing, its benefits and risks, and the critical role it plays in fostering capital formation and job creation in our free market system. Learning, Earning and Investing is an investor education program focusing on the benefits of and strategies for investing for the long term. Lessons cover basics such as the language of financial markets, reading the financial pages and financial institutions in the U.S. economy.
After participating in the Learning, Earning and Investing curriculum, students’ average scores improved by 19 percentage points as measured by a test of financial knowledge developed for the project. This change is significant and such a change in financial knowledge is important. Earlier studies have shown that financial knowledge is highly correlated with improved financial behavior.
Similar positive results were found regarding the change in student attitudes toward saving and investing. Based on the results from this study, it appears that Learning, Earning and Investing is a powerful tool for financial education at the secondary level.
I think it works because the curriculum is correlated with teacher training. Which is to say, it is not enough to have materials, the teachers have to be prepared to use them effectively. The heart of the Council’s mission and method is professional development for teachers
2. Financial Fitness For Life (FFFL)
In 1999, the Council for Economic Education and the Bank of America Foundation partnered to address the emerging need for “fluency” in personal finance among young people by developing the award-winning Financial Fitness for Life program. Financial Fitness for Life is the nation’s most comprehensive personal finance education program targeting Grades K-12 educators and their students.
Since the program was launched in 2001, this program has resulted in the training of over 15,000 K-12 teachers and 6,000 parents nationwide. Each year, over 1.5 million students benefit from that training, absorbing key concepts and principles of personal finance and learning to make sound financial decisions throughout their lives.
In addition, over 25,000 teachers (reaching some 2.5 million students annually) and 30,000 parents have acquired Financial Fitness for Life materials through the Council’s vast distribution system, dramatically extending the total number of teachers, students, and parents benefiting from this program.
In total, some four million students are learning and using sound financial decision-making skills each year thanks to Financial Fitness for Life. These award-winning teaching materials offer an array of special features that distinguish them from other personal finance curricula.
An assessment study two years ago showed measurable improvement in financial literacy in a wide range of High School students from FFFL, not only over those who had no other financial education, but by those exposed to other programs.
So, these are select examples of what’s “out there” – the kinds of initiatives that can be, and need to be, magnified.
One of the Council’s major advocacy tools is the Survey of the States: A Report Card on the Nation. We conduct these surveys to gauge how the state standards, their implementation, course requirements, and state testing change over time.
These biennial surveys – found on our website – give us indicators of how best to address and improve the teaching of economics and personal finance in our nation.
Economics, traditionally part of the core Social Studies curriculum, is now included, at least to some extent, in the educational standards of all states.
40 states (up from 38 in 2004 and 28 in 1998), now require these standards to be implemented. 17 states require students to take an Economics course as a high school graduation requirement (up from 14 in 2004 and 13 in 1998).
Personal Finance, a newer subject in comparison with Economics, is now included, at least to some extent, in the educational standards of 40 states (up from 34 in 2004 and 21 in 1998). 28 states (up from 20 in 2004 and 14 in 1998), now require these standards to be implemented.
Still, however, only seven states require students to take a Personal Finance course as a high school graduation requirement (up from six in 2004 and one in 1998), and only nine states require the testing of student knowledge in Personal Finance (up from eight states in 2004 and one in 1998).
The Council for Economic Education achieves our mission by two primary methods: 1) advocacy, with policy makers, educators and the private sector for the importance of greater and more effective economic education; and 2) a comprehensive K-12 program that includes developing and delivering high-quality instructional materials to teachers; providing critically-needed professional development opportunities for teachers and other educators who work with youth; conducting meaningful evaluation and assessment activities to measure student learning outcomes; and working with key economic education organizations and partners in an extensive national and international delivery system. The Council’s primary goal is to ensure that sound economic decision-making skills are taught early, incrementally, and well throughout the K-12 curriculum in an “active learning” methodology.
Former U. S. Treasury Secretary Robert Rubin, in his book, In An Uncertain World, and in numerous interviews, has said:
“We live in a very complex time of rapid global change. Our economic system would benefit enormously from a better understanding of these dynamics. Too many Americans lack an understanding of the economics behind public policy. Too many Americans lack the understanding of economics necessary to make good financial decisions. High schools should have a required course in economics. If they have geography and history, why wouldn’t they have economics? Every high school graduate in this country should have had some basic economics.”
Thank you, Mr. Rubin. I could not have said it better myself!
And he said it before the current crisis!
So let me offer, as the President of the Council for Economic Education, which is playing a real leadership role on this matter, as well as a member of the U.S. President’s Council on Financial Literacy, some reflections on where we go from here, today.
First, let us be mindful of the fact that economic education and financial literacy go together. Although financial literacy is a “hot” topic today, all our young people, indeed all our citizens, need a grounding in basic, practical and applied economics, in order to make worthwhile choices about managing their money and being self-reliant participants in the economy.
It is important to know something about concepts and principles like “scarcity” and “opportunity cost” and “cost-benefit” in order to make good decisions, both fundamental financial decisions and life decisions – and that’s what it’s all about: making good decisions. “The economic way of thinking.” Because, economics is a critical dimension of and in everything we do.
Let us resolve to improve and extend this literacy – through the nation’s schools, in the workplace, in the market place, in public policy, in advocacy and program delivery.
By coming together – as we are doing, here, today – in a concerted, purposeful look at the issue – we can foster the ways and means of strengthening and growing financial literacy, worldwide – which is urgently needed today, and tomorrow, and the day after tomorrow!
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