If privatizing Social Security is so great, why don't they teach financial literacy in our schools?

in #life7 years ago

I see that there are still some people in Congress who think the world of privatizing Social Security. They seem to believe that Social Security will eventually run out of money and that it is not a very efficient means of securing retirement income for Americans. To them, privatizing Social Security would be great, by they're not very clear about who it would be great for.

Long ago, I read the book, Rich Dad, Poor Dad, by Robert Kyosaki, a man on a mission to teach financial literacy to the world, for a fee. Reading that book gave me some enthusiasm for starting my own business. It really did give me hope. Although I never started my own business and kept it going, I've tried a few things only to fall back on employment again and again. I guess it was just too scary for me. I've taken notice that for most of us, business is just something we leave for others more qualified.

Who are those "other people" who are more qualified? The takeaway I got from Kyosaki's book, was that rich dads teach their kids business and poor dads teach their kids to get good grades and get a job. Rich dads teach their kids investment and business skills and send their kids to the right schools to learn those skills. Poor dads never learned those skills, so they may not even know they exist.

While participating in a debate on economics in social media one day, I saw that one man said he made the right investments early in life. He had started a Direct Re-Investment Program (DRIP) investment in an electric utility decades ago and was now receiving about $3000 a month in retirement income from it. No doubt this is a smart move. But how many kids now in high school or even college know about this sort of thing? Not many.

It is almost as if personal finance, business and investment skills didn't even rate as a mention when I went to school. I can clearly recall learning how to fill out employment and credit card applications in high school. But I never saw any kind of business skills there. It was never promoted and it wasn't even offered. No one ever said, "This is a balance sheet, let's see how to use it in a business".

So it would seem that as a matter of public policy, most kids were not being taught how to manage their own money or run their own business. This would explain why inequality is so extreme in the United States today. If most people are being taught to be employees, and the captains of industry are keeping money skills in private schools, then we can expect the results we see today.

While researching this article, I learned that business and personal finance skills in primary education are only recently getting some notice. The hits on the first page of my search show that the most popular articles on the subject of money skills were written after 2010, with most of them appearing after 2015. Money and making money skills are just now coming to the fore in public education. It's almost as if the financial collapse we witnessed in 2008 was the wake-up call and it took 7 years for personal finance to become an issue in public education policy, and then to be implemented.

This is a matter of public policy. In America, a very conservative Congress wants to privatize the Social Security system, but has not made it a matter of public policy to teach personal, business and investment skills to kids by high school. Guess who has the most influence in public policy decisions? The top 1%.

So it would seem that the goal for the hedge funds and investment banks then, is to have most people working for a living and to take their money from their retirement accounts if and and when Social Security is somehow privatized. It seems rather convenient that financial literacy is not as important as turning Social Security over to Wall Street.

As I think about this and try to boil it down to the simplest of statements, I see a wealthy investor class that must think they're better than everyone else because they have the money and the skills to make it. They teach money skills in expensive private schools, and do not make that a priority in public schools and then tell everyone that the inequality we see today is just how the market works. That's kind of like challenging someone to a knife fight and bringing a gun.

At least there is some good news that in some public schools, there is an awareness that kids need to learn personal finance and business skills. It's becoming clear that the wealthy investor class thinks little of everyone else, or financial literacy wouldn't even be an issue. It is quite possible that if most Americans were financially literate, the bubble economy we endure now could not continue with the kind of scrutiny that would be applied by millions of financially literate people.

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