Religious Education

A friend recently told me a story regarding her four year old son, who has recently started prep at a local state school.

They were on a long car trip and she had been coming up with games to prevent him from getting irritable. In one game, she named an object and he had to think about how long it would take to build. It was a particularly good game because with limited input she could keep him occupied for quite a while. The question "how long would it take to build a house?" became a discussion about what parts a house has and how long it would take to build each of them. This game was going well and the boy was getting better at it, so she thought she'd stretch him a little with "how long would it take to build a whole city?". The boy replied "don't be silly, God made the cities".

This response obviously came as a surprise to someone with no record of church attendance and a child at a non-denominational school. It turns out the school had introduced a religious education program.

The fact is, kids are fed 'information' from a whole lot of sources and I don't consider the occasional hour of RE to be a major concern. I spent most of my school days at either Catholic or Anglican schools. While most of those who conducted my theological educaltion were intelligent and well-rounded, I did come the occasional crazy who had weasled into a school to try and push an ideological agenda onto impressionable minds. I find comfort in the lack of success in attempts to indoctrinate me.

Years of listening to Christian sermons basically just left me with a good store of parables and a better understanding of the frequent biblical references in literature and movies. By way of contrast, years worth of advertising have meant that now, in my late 20s, I still occasionally feel compelled to buy a box of Coco Pops.

The thing I find concerning is that someone has evidently told this kid that "God made cities". Despite my many years of attending chapel services, I can't say I remember that part of the bible. From a teaching perspective, this is like having your kid come home and tell you that "their" and "there" can be used interchangeably, because their English teacher couldn't be assed explaining the difference.

Numeracy

NAPLAN tests have just finished. For those who aren't 'in the loop' with either a) school aged kids; b) their parents; or c) education unions, the "National Assessment Program – Literacy and Numeracy" is taken by all year 3, 5, 7 and 9 students across the country. The results will later appear on the Government's My School website, thus providing parents with an empirical basis for haranguing school principals and bored office workers with an quantitative scorecard for playing "my old school's better than yours".

Speaking to my 10 year old sister about her numeracy test, she assures me that she's "stuffed it". Fortunately, our communication is bridged by a certain bond of genetics; whereby we not only share similar aptitudes, but also similar anxieties. I assume she's concerned someone in her class may have done better than her.

Jump forward 15 years. A former colleague and I have drastically differing views about the responsibilities of financial institutions. Neither of us are sufficiently important for our views to matter to the organisation and both of us are sufficiently unimportant that we can spend half an hour arguing about it every morning for a week. My colleague's view (I'll try to render it faithfully) is:

"There are laws in place to protect people. Financial institutions can't break the law, but it's not their responsibility to look after people who don't do enough research before throwing their money at things in the hope of easy money."

It's not that I don't have some degree of sympathy for this kind of pop-libertarian "rights and responsibilities" perspective. I just don't have that much faith in the financial of numerical literacy of most people. I take the view that Macquarie bank and Goldman Sachs JBW go into a negotiation, they both know the game, the rules (or lack thereof) and have the resources to stick up for themselves. But Mum and Dad Public just don't have those skills.

Unfortunately, I can see quite clearly how easy it would be to convince MDP to hand over the family farm:

1. Select an asset that has performed steadily over the past 10 years and show MDP a nice graph. This should assuage their concerns about risk;
2. Cite a historical percentage return (above the bond rate) and spell out how much an investment will be worth in ten years ("the magic of compound interest"); and
3 (the evil part) Use lots of simple language, but pepper it with financial jargon. The jargon makes you look knowledgeable to the uninitiated. The simple language makes them think that they ought to understand the jargon. The result is that they're too embarrassed to ask questions.

I'm not suggesting this - as nice as money is I kind of enjoy being able to get through the day without having to live in the continual knowledge that I'm an asshole. My point is that if I can think it, I'm sure I'm not the only one.

The point is, that as someone with a reasonably good grasp of numbers and financial matters (my colleague had a maths degree and I have an engineering degree and we both worked for the same financial institution), it's easy to forget that most people just don't know about money and numbers. To people who like numbers and are surrounded by other people who like numbers, it's hard to understand how confusing maths appears to most people, who only really want the kind of functional grasp of finance that will enable them to have somewhere to live and some money for when they're too old to work.

I have struggled with why this idea is so hard for a lot of financial types to muster. This idea of "functional knowledge" is precisely how I feel about plumbing, computers and housework. However, a recent working paper on the correlation between financial literacy and sub prime mortgage delinquency (courtesy of Federal Reserve Bank of Atlanta) has suggested to me that perhaps I have been guilty of a lesser form of the same delusion.

The paper appears to lead some institutional cred to my theory that most people just don't have the skills to make rational financial decisions. And that's before they're pitted against a counter party with an interest in them making poor decisions. The frightening part was when I looked through the five questions they used to categorise people into groups - provided in multiple choice form here.

Only 13% of people surveyed got all of these questions correct.

Let's hope those NAPLAN tests are doing some good.