Las Vegas Sun

October 18, 2017

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Reading, writing and ’rithmetic … and interest rates

Lawmakers told lack of financial understanding partly to blame for downturn

Credit default swaps, risky mortgages and Wall Street greed have become the usual suspects in the economic crisis.

Several business and nonprofit leaders believe the state’s public school curriculum is another culprit.

“The genesis of Nevada’s current economic crisis is due to home foreclosures and a general lack of understanding among many home buyers of the sort of financial agreements they were entering into,” Leslie Pittman, a lobbyist for the United Way of Southern Nevada, told lawmakers last week.

Testifying in favor of Senate Bill 317, which would require students be taught the fundamentals of financial literacy, Pittman said: “While we recognize the Legislature does not typically set curriculum, this issue is of paramount importance.”

The bill would require high school students to be taught “the skills necessary to develop financial responsibility,” including credit and debt, consumer protection laws, the benefits of saving and budgeting and the basics of investing.

State Sen. Allison Copening, D-Las Vegas, lead sponsor of the bill, said “while there are many causes to the economic problems facing the country, it is undeniable that a lack of financial literacy is a contributing factor. I believe we owe it to our teenagers to equip them for financial success.

“Many of our young people are ill-equipped by our education system to understand personal finance and make their way into the modern world,” Copening said.

The legislation was drafted with input from the United Way of Southern Nevada, Junior Achievement, the Nevada Bankers Association and Clark and Washoe county school districts. A similar bill, Assembly Bill 505, was written by the Education Committee.

School officials, however, are reluctant to take on another educational task.

Jhone Ebert, assistant superintendent of curriculum for the Clark County School District, said she supports the intent of the legislation, but questions increasing the burden on educators.

“When the curriculum is as tight as it is right now, adding something means we have to look at taking something else away,” Ebert said. “Financial literacy is important, but so is all of mathematics and all of social studies.”

Bill Uffelman, president of the Nevada Bankers Association, told the Senate Health and Education Committee during last week’s hearing that principles of financial literacy can be incorporated in subjects already on students’ schedules, such as math and social studies.

“The notion that they (schools) can’t find the time always bothers me,” Uffelman said. “There are places that this information can be put so students have basic knowledge, just like they learn the Constitution.”

Some experts question the value of mandates to teach financial literacy in public schools.

There is “very little evidence” that such instruction works in high schools, said Annamaria Lusardi, an economics professor at Dartmouth College.

That doesn’t mean schools should give up, Lusardi said. Rather, there should be more effective lesson plans taught by qualified teachers.

“If I give you a description of a mortgage, I’m not helping you very much because chances are that instrument is going to be very different in two or three years,” Lusardi said. “You’re better off if I explain to you how interest compounding works, because that’s what will help you choose a better mortgage later on.”

Supporters of the bill note that the School District is already successfully teaching some aspects of financial literacy in magnet programs and elective courses.

Last year nearly 3,000 elementary, middle and high school students participated in a simulated stock market competition sponsored by the Nevada Council on Economic Education. Students select stocks and earn points based on the performance of their paper investments.

“The interest is there,” said Sheri Perez, who teaches economics at the College of Southern Nevada and coordinates the competition. “It’s finding the time to implement it.”

Christine Estrella, a seventh grade math teacher at Fremont Middle School, said the competition helps students connect what they’re learning with real-life applications.

“It’s a more active way for the kids to learn,” said Estrella, whose students are in first place among middle schoolers in this year’s statewide competition. “Any time I relate a lesson to money, they seem to be more involved and interested.”

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