Thursday, June 16, 2011

Financial Illiteracy Contributed to Stanley Cup Riot

Would a small business owner smash a store window? Would a self-employed person flip over a car? Would an entrepreneur set a garbage can on fire? Not likely and it may come down to financial education and the lack of it in BC schools. 

It's About Money, Not Hockey
What do entrepreneurial types have in common? They understand money. They know how difficult it is to raise it, save it and grow it. They respect it. They get it. Entrepreneurs tend to understand that an NHL team is a business and the aim of every successful business is to make money. Hockey is secondary to profit. This isn't amateur sports.

Entrepreneurial-types understand that it doesn't really matter who won last night. The teams put on a good show, made lots of money and, riot aside, everybody won. The rioters, apparently, didn't grasp this fact. For this group of young adults, who appear from media images to be primarily in their twenties, it's all about "my team has to win" and so losing is personal. The business aspect, the fact that money is at the heart of professional sports, didn't seem to be part of the individual rioter's thought process. Those who rioted clearly don't understand money nor do they have any respect for it.

Which may be why smashing windows, flipping cars and setting public and private property on fire was an appropriate response for them. There is no consideration of the expense, no cost-benefit analysis, no awareness that everyone who participates in the Vancouver economy will be paying for this outburst in both the short and long term. And why is the average twenty-something Stanley Cup rioter so unaware when it comes to money? It could very well be the lack of financial education in BC schools.

Not Enough Financial Education
Since, 2008 every student in BC has had to take a "life skills" course called Planning 10. In that course there is a four week, twenty-hour unit on personal finances. There are four prescribed learning outcomes for this unit: budgeting, planning for life after graduation, understanding credit and debt and how to report personal income. It has been argued that this is better than nothing. But is twenty hours of instruction enough to make students financially literate, especially when most of those students arrive in Planning 10 with little or no familiarity with the vocabulary and concepts of personal finance? Not likely.

Only a small portion of high school students in BC take business courses. That means most graduates don't get more financial education that what they receive in Planning 10. You cannot create a money-savvy citizenry with twenty hours of instruction over thirteen years, which is why the Ministry of Education in Ontario, starting this fall, is making personal finance education a mandatory part of the curriculum in grades four through twelve.

Imagine those Ontario students who are starting grade four this year. Every year for the next nine years they are going to be learning the language of money. They are going to be introduced to the realities of earning, spending and saving. Core concepts are going to be repeated and reinforced, deepening their understanding of how their personal financial choices shape the world we live in.

In Toronto in 2020, there will probably be a record number of high-school graduates who go on to start small businesses or choose to be self-employed. The city's economy will benefit from this upswing in entrepreneurial spirit, self-driven productivity and healthy respect for money. And if, by chance, the Leafs happen to lose game seven of the Stanley Cup finals in 2025, you can bet that with its financially aware and economically responsible citizenry that there won't likely be any window smashing, car flipping or random burning in downtown Toronto. 

Financial literacy is a powerful force. So is financial illiteracy, as we saw in Vancouver last night.

Copyright 2011. Laura Thomas. All Rights Reserved.
For reprint permission contact moneyme at telus dot net.

3 comments:

  1. On the way to school, one of my kids said "don't those morons know they'll have to pay for all the property damage with higher taxes?!" I was happy to see some connections being made between actions and long-term financial consequences.

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  2. I totally agree Laura. Personal responsibility and self-control is at the heart of financial literacy.

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  3. Well said. I see the new BMO commercials advertising their new services to parents wanting to teach their children the value of money - We rely so much on the school system to teach values that parents are failing to instil!! Nevertheless, kudos to those school boards who are somehow managing to squeeze it into the schedule and doing it from a very young age where it is most effective and essential.

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