On a Mission to Educate One and All

"Really, economic education is a central piece of civic education; educated, informed citizens need to have a better grasp of the issues, which always have an economic base to them." 

—Rodney Gerdes | social studies teacher and department chair at Oakville High School, St. Louis

When I tell people about my job as head of the economic education department at the St. Louis Fed, I often get this response: "I hated economics. All those graphs and all the math." My response is usually something like this: "At its core, economics is about the decisions people make when faced with limited resources. All of us are faced with limited resources at a personal level, but the businesses we run or for whom we work, as well as those who govern us, face limited resources, too. Making informed choices and recognizing that there are costs and consequences to the choices we make are key elements of economic literacy."

When we make informed economic decisions, we benefit and often society as a whole benefits.¹ Let's look at some of these decisions:

• Students who choose to attend a trade school or decide to get a two-year or four-year degree recognize that they give up the goods, services or saving they could have had with the money they spend for school. They also give up the opportunity to earn income while attending classes and studying. However, they likely recognize the future consequences of this choice—better access to employment and higher income over their lifetimes than would be available with only a high school diploma. Society benefits because these students are prepared for jobs, are more productive, earn higher incomes and, as a result, are able to spend and save more over their lifetimes than those who don't pursue postsecondary education.
• Local governments are often asked by developers for tax breaks as a condition for building housing, retail shops or other businesses. The governments must decide if the promise of more tax revenue later offsets the forgone goods and services (roads, schools, etc.) that could be provided with that funding now. The best decision will provide the most benefits to the community relative to the costs.
• Likewise, business owners make decisions on a daily basis. The automaker weighs the pros and cons of building a new plant vs. retrofitting an old one. A retailer must decide if a bricks-and-mortar store can still make money in this online world. A baker wonders if she should focus on bread for the masses or personalized cupcakes for the few. The choices these business owners make affect the number of workers they employ and the amount of tax they pay—and all of this affects society as a whole.

Making informed decisions reminds us that there is no such thing as a free lunch. Yes, it's a cliché, but people often lose sight of the fact that choosing one option involves giving up another. In spite of the importance of economic literacy, few of us can say we make the grade. Perhaps that's because the teaching of economics and personal finance isn't a priority in most schools.²

Among the many who think more needs to be done in the schools is Vicki Fuhrhop, a member of one of our educator advisory boards: "We're educating the consumers of the future, the citizens who will be out there voting and having an impact on our nation and the economy; they need to be prepared."

Only 20 states require high school students to take an economics course. (Even fewer states—17—require a course in personal finance.) Students may have an opportunity to take an economics course in college, but in 2014 only 65.2 percent of U.S. high school students chose to attend college.³ And, only 3 percent of U.S. colleges and universities require students to take a basic economics course, according to a report from the American Council of Trustees and Alumni.⁴

As a result, many people don't understand basic economics or aren't literate in financial concepts needed in the world today.

A Longtime Mission

For decades, the Federal Reserve Bank of St. Louis has provided economic education. In the beginning, this involved face-to-face training with teachers and a twice-a-year newsletter for them. Our efforts escalated when James Bullard became president and CEO of the St. Louis Fed in 2008. At the start of his tenure, he stated, "Many people think economics is too complicated. But everyone lives with the consequences of supply and demand every day. We live in a market system, and people need to understand how the system works."⁵

Bullard had a vision for economic education at the St. Louis Fed. He asked us to provide easily accessible resources online to help people understand their economic world. He challenged us with this task in 2009.

Listen as Mary Suiter talks about the many resources that the St. Louis Fed has to help all sorts of people—from preschoolers to retirees—learn about basic economics and personal finance. She also discusses the motivation behind these education efforts.

Since that time, we have created more than 400 classroom resources, including videos, online courses, lessons, whiteboard activities, PowerPoint decks, websites, webinars, publications, infographics, glossaries, flashcards—plenty for everyone to teach themselves and to teach others about basic economics and personal finance.

We have two primary online tools:

• Education resources that anyone—young kids, students applying to college and their parents, grandparents, business leaders, struggling families—can access; and


• a teacher portal at www.econlowdown.org because teachers are the main audience we target. Teachers, along with Scout leaders, community group leaders, home schooling families and others, can go to the portal to register, create classrooms, add students to those classrooms, and assign videos, audio casts and online courses for students to complete.

Our online push started in 2010. In 2016, enrollments topped 1 million for the first time in a calendar year, reaching nearly 1.2 million by the end of the year.

Since the first resources were added to the portal, we have had more than 3.4 million enrollments in the online resources from all 50 states, as well as from England, Spain and Canada. In the past three years, the Federal Reserve banks of Atlanta, Philadelphia, Cleveland and Kansas City have joined us in making resources available through the teacher portal. We also have resources available to help people learn to avoid fraud from the FINRA Foundation for Investor Education and to learn about capital markets from the SIFMA Foundation.

Among our many other partners is Economics Arkansas, which trains teachers to integrate economics and personal finance into their classes. "You're the Cadillac of professional development organizations that we can partner with," says Sue Owen, the executive director. "The quality, the content, the professionalism, it is absolutely the best."

In addition to our online resources, we provide professional development for educators. Last year, we made face-to-face presentations to more than 6,000 educators. ("The conferences are fantastic," says Rodney Gerdes, one of our frequent attendees.) And, these educators have gone on to teach students year after year—multiplying our reach across the St. Louis Fed's District and the country.

Of course, we provide resources for economics and personal finance classes. But, knowing that economics is not required or tested in most schools and school districts, we provide resources that can be used to integrate economics in other disciplines.

For example, our resources for young children emphasize the basics in economics and personal finance while enhancing language arts and mathematics skills. If teachers are reading the book Alexander Who Used to Be Rich Last Sunday,⁶ they can use our lesson to talk about spending, saving, choices and opportunity cost. They can also reinforce math content, such as counting by 2's and creating bar charts. As another example, middle school mathematics teachers might incorporate our lessons about compound interest and credit into an algebra class.

It's not uncommon to see our resources used in high school government or history classes, too. One of our first initiatives was to create six lessons about the Great Depression.⁷ These lessons can be used alone but are often used in coordination with government lessons on monetary and fiscal policy or with history classes studying the New Deal.

Our resources for learning about economics and personal finance include something for just about everyone—videos, podcasts, lesson plans, newsletters, online courses, infographics, in-person training and even old-fashioned flash cards. These numbers scratch the surface on what was available and who was using what in 2016.

Since that first multidiscipline curriculum was created, we've answered the call for more lessons integrating economics in history, geography and government classes and incorporating data, maps and primary source documents.

The resources we create for classrooms are vetted by economists and reviewed by classroom teachers. We have educator advisory boards across our District, with more than 100 members in total. These teachers provide feedback and assist in developing content that works in classrooms.

What about the Results?

We found that on average in 2016 the post-test scores of students enrolled in our online courses were 23 percent higher than their pre-test scores. In 2009, outside evaluators reviewed our GDP and Pizza course and found a 14 percent increase in student post-test scores, which was statistically significant.⁸ A 2015 evaluation of our Soar to Savings online course showed positive and statistically significant gains in learning from pre-test to post-test. More specifically, the study found a 56.5 percent increase in scores from pre-test to post-test.⁹

We also partnered with an urban community college in our District to develop and implement a financial literacy curriculum unit for its new-student course. The curriculum was taught in randomly selected sections.¹⁰ We evaluated the effectiveness of the unit based on student pre-test and post-test scores. On average, students who were taught the financial literacy curriculum unit scored about 7 percentage points higher than the students who were not taught the curriculum.

On the following pages, you will read more about the need for education about economics and personal finance, as well as about the results it yields for many different people. Specifically, the articles cover:

• the reasons we focus on teaching teachers,


• the importance of teaching economics and personal finance to children when they are young—as young as preschoolers,


• our emphasis on decision-making—how good economic decisions benefit the stability of the individuals and families making those decisions and the stability of the economy as a whole, and


• the vital need to invest in human capital.

Along the way, we will show you samples of our resources, as well as connect you to short videos, podcasts and other audio clips featuring people who use those resources—teachers, students, parents and others.