Financial Literacy Education for Citizens

Citizenship, Social and Economics Education Volume 11 Number 3 2012 www.wwwords.co.uk/CSEE

163 http://dx.doi.org/10.2304/csee.2012.11.3.163

Financial Literacy Education for Citizens: what kind of responsibility, equality and engagement?

CHRIS ARTHUR Department of Education, York University, Toronto, Canada

ABSTRACT Financial literacy education is often assumed to be a form of technical and/or hermeneutic training that assists citizens as well as consumers make responsible financial decisions. As a form of civic literacy education, financial literacy education is often framed as promoting civic responsibility, equality and engagement. This article calls into question the seemingly common-sense construction of financial literacy as personal money management for citizens and consumers and charges that many of the dominant financial literacy education initiatives support civic irresponsibility, inequality and disengagement. From a perspective informed by critical theory and pedagogy, the first three sections of this article analyse the character of the civic responsibility, equality and political engagement promoted in the dominant financial literacy education literature while presenting critical alternatives for each. The analysis in these sections supports the claim made in the fourth and final section of this article that a critical, emancipatory civic financial literacy is needed for a responsible, engaged citizenry who can extend and protect more robust conceptions of freedom and democracy.

Financial literacy education initiatives are often justified on the grounds that they help consumers manage the corporate and state individualization of economic risk and responsibility that results from delayed retirement, the switch from defined benefit to defined contribution pensions, higher tuition fees, fewer impediments to capital flight and reduced unemployment benefits. The claim is also made that a number of these initiatives not only aid in personal money management but also improve citizens’ civic responsibility, civic equality and political engagement. This article questions the purported civic benefits of many of the dominant financial literacy education initiatives by examining the character of the responsibility, equality, political engagement and thus the type of citizen they promote.

Borrowing from the distinctions between types of civic literacies elucidated by Henry Giroux (1980), the dominant civic financial literacy initiatives and the dominant financial literacy education research paradigm analysed here can be characterized as supporting a technical and/or hermeneutic civic literacy. Giroux defines technical civic literacy as an instrumentalist literacy that helps individual citizens solve problems within the world as it is given. It is a teaching of means without considering the ends those means are put towards or the reasons why certain choices are available and not others (i.e. why some students are not able to choose between taking on post-secondary education debt or attending tertiary education institutions that are funded through progressive taxation).

The hermeneutic form of civic literacy found in some financial literacy texts goes beyond the purely technical form by supporting analysis and dialogue about hegemonic production relations and economic practices. However, these relations and practices are viewed as fixed structures and activities to which we must accommodate ourselves through improved knowledge. Hermeneutic literacy education helps us become freer only in the sense that it leads us to a better understanding of the constraints limiting our actions. Thus, even as poverty and exploitation are brought up as

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issues for discussion, a hermeneutic paradigm naturalizes the capitalist constraints within which questions and conflicts about these issues can take place (Giroux, 1980, p. 385).

Most financial literacy research is conducted within a technical and/or hermeneutic paradigm and concerned with questions of methodology (how to measure financial literacy), pedagogy (how to teach financial literacy) or statistical analysis (the compilation and evaluation of financial literacy data). This article instead joins the few studies that have called into question the picture of the world and ethics promoted by financial literacy education initiatives and/or its efficacy (Erturk et al, 2007; Lucey, 2007; Williams, 2007; Lucey & Cooter, 2008; Willis, 2008; Pinto & Coulson, 2011; Arthur, 2012a, b; Carr, 2012; Pinto, 2013). These heterodox approaches to financial literacy education vary in their goals and approaches, but they all acknowledge, as have others with regard to economic literacy (Humes, 2002; Agnello & Lucey, 2008a, b), that financial literacy is a political practice.

The marriage of financial literacy and citizenship education should make the political nature of the former obvious but too often it fails to do so. Instead, the expansion of the scope of financial literacy into the field of citizenship education supports depoliticizing a greater number of political, economic issues.[1] This integration does expand financial literacy education’s scope beyond individual consumption practices – thus supporting the potential for a less individualistic and consumerist reading of economic issues within the discipline – but this article, from a perspective informed by critical pedagogy and critical theory (Marcuse, 1968; Freire, 1970; Giroux, 1980; Freire & Macedo, 1987; McLaren & Farahmandpur, 2005; Carr, 2012), argues that many civic-oriented financial literacy education initiatives simply present economic and political issues from the same technical, hermeneutic and individualistic perspective.

This is not only unfortunate; it is dangerous. As consumer and public debt rises and citizens are forced to acquiesce to ongoing austerity measures, the continued economic crisis provokes reactions from the social half of Polanyi’s ‘double movement’ (Polanyi, 2001), giving rise to Occupy and other movements that carry the potential to limit or reverse the continued neoliberalization or marketization of society (i.e. the continued retrenchment of the welfare state, privatization and the replacement of the citizen with the entrepreneurial consumer-citizen) as well as openly reactionary movements (e.g. Greece’s fascist Golden Dawn) that seek racist, anti-immigrant and anti-democratic ‘solutions’ to economic problems. As always, but certainly in times of crisis, citizens committed to democracy require more than a technical or hermeneutic civic financial literacy enabling consumer-citizens to act within a fixed political economic paradigm that will only continue to produce crises; they require a critical, emancipatory civic financial literacy that supports deliberation and civic engagement aimed at altering a political economic system which constrains our actions so as to make crises all but inevitable.[2]

The first three sections of this article analyse the character of the civic responsibility, equality and political engagement promoted in the dominant financial literacy education literature while presenting critical alternatives for each. The analysis in these sections supports the claim made in the fourth and final section of this article that rather than technical or hermeneutic civic financial literacy education texts, which support civic irresponsibility, inequality and political disengagement, citizens require the critical, emancipatory civic financial literacy that will create a critical citizenry able to responsibly protect and extend democracy.

Civic Responsibility

Citizens who live in democracies are ultimately responsible for the character of their democracy. To help citizens take up this responsibility, civic-oriented financial literacy initiatives teach them to prudently consume financial products for the benefit of themselves and their democracy’s economy. The argument is not new: Adam Smith, one of the more famous extollers of the supra individual benefits of self-interested behaviour, argued, ‘it is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest’ (1776/2003, p. 23). The Organization for Economic Cooperation and Development (OECD), updating Smith’s argument, posits that financially literate consumers will improve market stability because they will demand financial products ‘more responsive to their needs ... [and] encourage providers to develop new products and services, thus increasing competition in financial

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markets, innovation and improvement in quality’ (OECD, 2005, p. 35). The role of financial literacy educators, according to the OECD, is to teach self-interested consumers/investors how to purchase the ‘right’ financial products, an act that will lead to ‘good’ financial products being created by financial corporations and thus improve the economy. In short, citizens qua responsible consumers are to regulate and improve the economy through their private, self-interested, ‘civic’ consumption.

In addition to purchasing the ‘right’ financial commodities, civic financial literacy education initiatives often define being ‘responsible’ as becoming a self-sufficient, self-reliant citizen-monad. In the words of the heads of the Canadian Financial Literacy Task Force, if individuals make the proper financial decisions, they will be ‘less vulnerable to job loss or the financial impact of accidents or illness’ and thus fewer families will require ‘welfare or other social assistance programs’ (Stewart & Ménard, 2010, para. 10). Reducing the ‘burden’ on social programs is increasingly important as government deficits and debts mount, populations age and social programs are increasingly placed on the chopping block. In this era of austerity, continued profligate spending cannot be tolerated, either by individuals or governments; ‘we cannot live beyond our means’ has become the new mantra. Thus, mismanaging one’s finances and relying on scarce collective resources is even more morally irresponsible than it was during times of economic growth. As in the first example, citizens’ duty towards their fellow citizens has been turned inward so that they are only responsible for taking care of themselves and making sure they do not bother or need to rely on others. Through their aggregated private consumer action, these consumer-citizens positively contribute to the character of their economy qua democracy.

In addition to indirectly helping others, those who have achieved financial success through investing effectively are in a position to take up a largely voluntary civic responsibility and help others through acts of charity. This optional civic duty surfaces in the Ontario financial literacy working group’s report on financial literacy education, which links financial literacy to compassionate global citizenship:

Being financially able, being able to provide for ourselves and our families, also puts each one of us in a position to help others. The world’s disasters are a glaring example of the need for some to come to the rescue of others. (Ontario Ministry of Education, 2010, p. 18)

The high-profile Canadian non-profit financial literacy education organization, the Investor Education Fund (IEF), also points out the charitable benefits that can arise from financial success in one of its popular financial literacy texts used in teacher workshops:

When an entrepreneur is successful, the business usually generates financial rewards to the owner, benefits to the consumer, and jobs for all of us. Sometimes entrepreneurs donate large portions of their fortunes to hospitals, universities and other charitable organizations. (Kelly et al, 2006, p. 112)

We can add to this list the United Kingdom’s Department for Children, Schools and Families’ resource, My Money: Citizenship teacher handbook, which also emphasizes charity as a civic responsibility (Personal Finance Education Group, 2009, p. 8). In these three examples the citizen is more active and directly impacts the lives of others but only through private action aimed at alleviating the symptoms of the problem; his or her actions have no effect on the systemic conditions, which place individuals in need of charity.

Going beyond simply occluding the need for collective, political action aimed at systemic change, the United States Foundation for Teaching Economics in its lesson plan on sweatshops (Foundation for Teaching Economics, n.d.) explicitly states that citizens should not even attempt to collectively alter their economic practices and relations. The lesson plan informs us that not only will collective, political action backfire but that the conditions, relative to the alternative options, are not as exploitative as we think – a fact made clear, the lesson tells us, because those who work in sweatshops chose to do so. Instead, all we can do is lower taxes and reduce barriers to trade so that hopefully increased productivity will bring about a greater standard of living for those working in sweatshops (Foundation for Teaching Economics, n.d.). This, we are told, is the only path to development – though one assiduously avoided by economic powerhouses such as Britain, Germany and the United States (Chang, 2002).[3]

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In these civic-oriented and consumer-oriented financial and economic literacy texts, we do not, as citizens, appear responsible for our economic system and the poverty and inequality it necessarily generates.[4] Our interdependence appears insignificant; we are only minimally responsible for the conditions that influence the failure or success of others through the aggregate of our private acts of saving and financial consumption. The result, I argue, is a depoliticization and consumerization of the citizen and his or her responsibility for the character of the economy.

Elizabeth Warren, elected to the US Senate in 2012, pointed out that ‘nobody ... got rich on his [sic] own’ and because capitalists rely on public education, the police and public roads to help them hire competent workers, defend their property and transport their goods, they ought to give something back (Madison, 2011). However, her impassioned speech does not highlight the full extent of our interdependence and thus the responsibility we have for the condition of others. While Warren is correct, our interdependence goes much deeper, and even if capitalists paid for their own roads, ran private schools to educate their future workers and hired their own police they would still share responsibility for the financial outcomes and financial risk others face. This is because the economic system within which capitalists reap ‘deserved’ rewards is socially constructed, could be otherwise and its very dynamism – its creative destruction (Schumpeter, 1942) – impoverishes some, while benefiting others.

The economy is socially constructed in the sense that capitalism and each particular type of capitalism (neoliberal, welfare, corporatist, workfare and state) do not rest upon some unassailable natural or just foundation. Contrary to those who, like Adam Smith (1776), view capitalism as an outgrowth of our propensity to truck and barter, its rise was not inevitable (Thompson, 1980). Workers who were divorced from the means of production and who had no other option but to sell their own labour were created by political, not natural acts (McNally, 1993). Likewise, land was not created already subdivided and ready to be cordoned off by some to the disadvantage of others. Finally, and most obviously, the state and the laws that support the continuation of this economic system are political, not necessary creations. In short, we could have a different economic system if we so chose, and citizens in a democracy ought to choose and be held responsible for their choice. Citizens, for example, ought to be held responsible for an economy in which choosing to accept a 50% wage cut to avoid being thrown out of work from an employer who posts substantial profits (Macaluso, 2012) is not only allowed but is in many cases dictated by the structural requirements of capitalism: a competitive system which induces capitalists to cut costs and treat workers as just another input in production.

The discourse of meritocracy, which underscores the financial literacy project, occludes that capitalism is an economic system that guarantees inequality and poverty alongside massive wealth. In place of a vision of a world that appears to provide individuals with the means to succeed if they work hard enough, I argue that we live in a world in which the possibilities for success for many are limited.[5] Given that workers are treated like commodities that continually must be devalued in order to be ‘competitive’, many will necessarily fail to retire comfortably, procure the resources they need to live comfortably or at all or have a sufficient amount of free time. In such a situation, citizens are responsible for the effects that derive from the continuation of capitalism and those who benefit more from capitalism are more responsible for its negative effects than those who benefit less.

Against those who would argue that a robust civic responsibility for the economy and its distribution of wealth, opportunities and risks impinges upon individual freedom (Nozick, 1974), I argue that it makes little sense to say that those who succeed ‘deserve’ what they worked for because their deserving is completely reliant on the choices that the system makes available, supports or allows. Simply because one can amass massive amounts of capital and economic power over others does not mean that he or she ‘deserves’ this capital or economic power outside of the practices, morality and laws of the system in which it was procured and is seen as deserved. A monarch who ruled justly, increased the productivity of his lands and even worked alongside peasants in the field does not ‘deserve’ the wealth of his kingdom outside of his system of feudal relations. The same logic applies to capitalism.

Clearly, the robust responsibility I argue citizens ought to take up – a responsibility for the economic choices and outcomes others face – is contingent upon the existence of an alternative to neoliberal capitalism. As much as neoliberals might like to think that there is ‘no alternative’ to further neoliberalization [6], history is not over and even within capitalism there are possibilities for


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expanding the limited choices and altering the outcomes people face: there are better and worse forms of capitalism. Citizens should not be forced to accept the world as it is by being encouraged to take up a disempowered, consumerized and depoliticized ‘responsibility’ that ultimately is irresponsible as it lets us off the hook for supporting an economic system and an individualized risk management strategy that will only ever benefit the few at the expense of the many. Financial literacy education, if aimed at creating and supporting responsible citizens, should enable us to see that treating macroeconomic issues (e.g. what type of economy we should have and what forms of risk management we should support) as individual, consumer problems is an irresponsible abandonment of our global civic duty to create relations of production, distribution and consumption that offer the possibility of universal freedom from scarcity: a goal predicated on the equality of human beings.

Equality

The desire to improve citizens’ ‘equality’ through financial literacy education is endlessly repeated. The Deputy Director of the Bank of Italy’s plea for greater financial literacy is paradigmatic: ‘Today more than ever, citizens need to be financially aware, to know the characteristics and risks of financial products, to choose correctly. It is a matter of equity, it is a need for stability, a help for competition’ (Tarantola, 2010, p. 1). Echoing Tarantola, Canada’s Finance Minister, Jim Flaherty, argues that financial literacy education will help those who are at a ‘competitive disadvantage’ vis-à-vis their fellow citizens become more equal in ability (Flaherty, 2008). Continued widespread financial illiteracy will only worsen inequality laments Flore-Anne Messy, the Principal Administrator for the OECD’s Financial Education and Consumer Protection Unit, who concludes that because ‘financial literacy levels are correlated with socio-economic status, inequalities are reproduced and amplified overtime’ (Messy, 2011, p. 3). Failure to become financially literate is frequently painted in the starkest terms; John Hope Bryant, the vice chair of the US President’s Advisory Council on Financial Literacy, for example, warns, ‘if you don’t understand the language of money, financial literacy, and if you don’t have a bank account, you are just an economic slave’ (Bryant, 2010a, para. 12).

While helping those who are economically disadvantaged or ‘economic slaves’ is undoubtedly a just goal, it is important to look carefully at the proposed solution – particularly the character of the equality being sold, the economic practices it supports and its impact on our ‘social capital’ (Putnam, 2001). The quotes above signal a concern to alleviate at least two types of inequality: inequality of outcome and inequality of opportunity. The explicit assumption upon which technical and hermeneutic financial literacy initiatives are founded is the belief that you can reduce the former through reducing the latter. Obviously, however, we should be concerned not only about whether or not individuals can equally attempt to succeed financially but also about whether or not the conditions in which they act will allow them to succeed.

While neoliberals are concerned with the conditions under which individuals exercise opportunity, the conditions neoliberals desire and foster, rather than alleviating, actually worsen outcome inequalities.[7] This is partly because, implied along with the neoliberal notion of equality as ‘equal inequality’ (Foucault, 2008), the state’s role is reduced to fostering conditions of competition and ensuring that its citizens are trained as gladiators who are able to compete on equal footing against others and garner international capital’s attention. Solutions that aim to collectively manage economic risk and directly improve equality of outcome through expanding public pensions, creating new relations of production, providing a living wage or producing necessary goods and services (healthcare, education, daycare, housing and food) outside of the market’s logic are viewed as inefficient, if not unjust (Arthur, 2012a).

Despite continued rising inequality as a result of neoliberal policies, many financial literacy advocates and texts imply, if they do not state outright, that greater financial literacy education in the face of crumbling collective supports will reduce income inequality and improve intergenerational income mobility. It is, however, not the case that, as Donald Johnston, the former Secretary-General of the OECD claims, greater consumer financial literacy will help solve the ‘major imbalances of wealth within nations’ (Johnston, 2005, p. 2). First, education has already proven ineffective in creating well-paying post-Fordist or knowledge economy jobs to replace those

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lost to technology and overseas competition (Brown et al, 2010). Second, income inequality and intergenerational income mobility are impacted by numerous factors more important than financial literacy such as income tax rates, income distribution, minimum wage rates, unionization rates, quality and cost of daycare, access to affordable healthcare, financial regulations, job qualifications, unemployment rates and the types of jobs available. Given the failure of education tailored to a knowledge economy to reduce inequality and the complexity of the causes of wealth inequality, it is unlikely that personal money management tips aimed at helping students calculate interest and understand the difference between needs and wants will have much impact on income inequality.

To be fair, I am not arguing that all or even most financial literacy advocates believe financial literacy education alone will bring about greater income equality: the heads of Canada’s Federal Task Force on Financial Literacy, for example, argue that ‘financial literacy is not a panacea’, though it apparently has benefits ‘too numerous to count’ (Stewart & Ménard, 2010, March 15, para. 9). I am arguing that even the advocates’ weaker claim misses the fact that consumer financial literacy education is not even a small part of the cure for inequality: it is part of the disease. It poses as a solution to the inequality generated by neoliberalization but supports neoliberal measures that will only worsen inequality: the individualization of economic risk, the spreading of market relations, the destruction of ‘social capital’ (Putnam, 2001) and the constitution of an entrepreneurial ethic (Arthur, 2012a).

Wendy Brown (2003) argued almost 10 years ago that we were in an interregnum in which ‘neoliberalism borrows extensively from the old regime to legitimate itself even as it also develops and disseminates new codes of legitimacy’ (p. 47). Today, financial literacy advocates pay lip service to the old liberal regime’s goal of equality of outcome but at the same time depoliticize and privatize the path to greater income equality. As the means to achieve greater equality of outcome are recoded, the aim of wealth equality is devalued as a common good and we shed the last vestiges of what 2012 Republican presidential candidate Mitt Romney calls ‘an entitlement society’ in favour of expanding the logic of a purely ‘opportunity society’ (Rucker, 2011). What worries Brown and should worry those concerned to promote substantive forms of citizenship, democracy and the necessary accompanying social capital is that neoliberalism drains liberalism of its capacity to generate concern for issues such as income inequality and increasingly has little need for the liberal justificatory mask so that arguments for equality of outcome or ‘social rights’ fall on deaf ears. Through the spread of equality as ‘equal inequality’, a social right to an equality of outcome becomes increasingly delegitimized: an ‘entitlement’ to be derided. Under neoliberalism you deserve the equality of outcome and rewards you win in the economic arena.

Financial literacy education’s privatization of economic risk and delegitimization of collective economic risk management solutions is particularly troubling in a context of massive wealth inequality as it decreases the likelihood that citizens who can provide for their needs through the market (private policing, transportation, healthcare and education) will feel responsible for the conditions faced by those citizens who cannot afford the services or same quality of services that the better off receive. In fact, those who cannot afford to provide for their needs in the market will increasingly appear as irresponsible parasites that are a drain on our collective resources or objects of pity who can only hope for charity. After all, having been given training on how to spend and save one’s money (which is assumed to provide one with the ability to amass wealth and manage economic risk), those who fail to succeed in the market have only themselves to blame (Willis, 2008).

Outlining neoliberalism’s moralizing of economic action, Wendy Brown writes: In making the individual fully responsible for her- or himself, neoliberalism equates moral responsibility with rational action; it erases the discrepancy between economic and moral behaviour by configuring morality entirely as a matter of rational deliberation about costs, benefits, and consequences. (2003, p. 42)

Financial literacy education texts and advocates too often promote a neoliberal equal inequality, justifying the financial outcomes of the winners and the losers without subjecting the (neoliberal) capitalist system, which restricts the possible outcomes in advance of the contest, to any critical scrutiny.


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Moreover, many financial literacy initiatives and texts support a further disempowering of the citizen and a profound inequality between elites and citizens, mirroring the insulation of central banks and the removal of much of the economy from popular control under neoliberal capitalism (Dumenil & Levy, 2004). In the financial literacy literature, the individualization of economic risk is often presented as a fait accompli ruefully offloaded by technocratic elites who argue that given the state of the economy, globalization or the demographic reality of an aging population the individual has no choice but to adapt and become a neoliberal entrepreneur. There is rarely any indication that these are political problems and that the proffered solution of risk devolution is only one among many political solutions.

The preface from Ontario’s new financial literacy curriculum document, which addresses a citizen who is encouraged only to react to ‘world economic forces’ by altering his or her consumption is a case in point (Ontario Ministry of Education, 2011). The citizen in this text’s preface does not politically intervene in order to create new ‘economic forces’ or new relations and forms of production, consumption and distribution. The minimal citizen portrayed in Ontario’s financial literacy curriculum text does not even advocate for collective measures to alleviate the worst effects of ‘world economic forces’. He or she is a passive consumer-citizen who leaves the available macroeconomic decisions (which are also fairly limited) to his or her periodically elected leaders. This mirrors other texts (e.g. Rabbior, 2007) which reproduce two levels of decision making (a substantive one for elites and a reactive one for citizens) and highlights the profoundly anti-democratic neoliberal belief that elites must be insulated and protected from popular influence so they can preserve a specific form of freedom, acerbically characterized by C.B. Macpherson as the ‘freedom of unlimited appropriation of others’ powers’ (Macpherson, 1973, p. 23).[8]

Civic Engagement

Financial literacy education is also frequently lauded as supporting empowered civic engagement, despite the fact that, as illustrated above, it often presents the citizen’s sphere of action as limited. Law professor Gail Pearson’s book chapter, ‘Financial Literacy and the Creation of Financial Citizens’, is emblematic:

The financial literacy project offers education for choice (or freedom) and education for civic virtue. Responsible participation in the market combines choice and virtue. These become attributes of the financial citizen, the ability to make an informed virtuous choice. The citizen is no longer simply a political participant and creator of liberal democracy but also a participant in wealth creation and economic progress/development. (Pearson, 2008, p. 25)

This form of hermeneutic civic engagement harkens back to arguments from the early twentieth century, which assume that business and consumers work together in a symbiotic relationship to bring about continued economic progress for the benefit of all. The home economist Christine Frederick highlights the reciprocal relationship between consumers, citizens, business, capitalism and progress in her book, Selling Mrs. Consumer, writing, ‘the merchandising system of today is in itself a great consumer’s club, and the members vote in broad democratic fashion at great popular elections, the polls being open every day at a million or more retail stores’ (Frederick, 1929, pp. 322-323). For Frederick, the diligence with which American women carry out their consumer duty is a ‘mighty makeweight in the balance of progress in America, both for individual health and happiness and for business’ (Frederick, 1929, p. 335).

Echoing Frederick, Pearson believes we become empowered citizen-consumers by tailoring our consumption so that together with business we have ‘control’ over what is produced. Our goal is essentially to become better cogs that can fit into and improve the existing economic system. The citizen’s duty to call into question how we organize the production, distribution and consumption of the fruits of our human labour is replaced with a duty to improve the functioning of the given economic system by conforming to the process’s needs or telos (i.e. by becoming informed consumers so that market demand helps rather than hinders economic progress defined as the production of increasing utility). Within this vision, democracy is improved if the range of consumer choices grows and the consumer is better able to choose that which he or she would desire were he or she a fully rational consumer.

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This is the form of depoliticized politics promoted by financial literacy organizations such as the influential international organization Junior Achievement, which, according to one of its chapter’s presidents, has as its goal the educating of financially literate citizens who can ‘contribute positively to the local and national economy, improving peace of mind and national stability’ (Moore, 2008, October 8, para. 7). Within this depoliticized frame the challenges facing workers in a globalized and increasingly neoliberal economy are frequently portrayed as inevitable. Gary Rabbior, the president of the Canadian Foundation for Economic Education, for example, writes in his financial literacy resource, Money and Youth, that ‘there has been a somewhat disturbing trend toward “good jobs” and “bad jobs” in Canada, the skewing of incomes, and challenges to our past successes in raising our overall standard of living’ (Rabbior, 2007, p. 69). However, this trend is described as though it was a natural phenomenon and our ability to deal with the ‘somewhat disturbing trend’ is reduced to individual measures (e.g. continual training, investing and pursuing a nomadic lifestyle). In the place of Junior Achievement’s goals of ‘peace of mind’ and ‘national stability’ and Rabbior’s naturalization of political economic issues, civic financial literacy ought to be a political literacy that supports a critical analysis of the instability, insecurity and precariousness upon which ‘our’ national stability and peace of mind rests. Instead of fostering a hermeneutic civic literacy and engagement that stabilizes the current neoliberal, common-sense order, we need citizens who can call it into question and destabilize it.

While Francis Fukuyama appears to have belatedly realized that history is not yet over (Greider, 2012, January 18), too many financial literacy advocates have yet to catch on. John Hope Bryant, for example, argues that everyone should have a right to a bank account at birth and that this should be seen as ‘no different than them having the right to vote at birth’ (Bryant, 2010b, para. 12). While voting and using a bank account certainly have their benefits, civic engagement ought to be more than voting or buying the financial products that are in one’s ‘interest’. Citizens ought to be actively involved in the continual and conflict-ridden (re)creation of societal relations and practices (Mouffe, 2005). The anti-political nature of financial literacy education’s civic engagement, however, is overlooked when focusing solely on providing limited political rights so that one can be better integrated into neoliberal capitalism.

The philosopher Jacques Rancière (2010) provides a helpful distinction between politics and the police that is of use in highlighting the problem with financial literacy education’s promotion of an apolitical, consensual and consumerist civic engagement. Using Rancière’s framework, we can characterize the above financial literacy education initiatives as seeking to reproduce the police order. Police, for Rancière, refers to the complex of codified material and symbolic practices, resources, subjectivities and spaces that reproduce the current vision and division of the world. Rancière describes politics, on the other hand, as action that disrupts the present vision and division of the world ‘by supplementing it with a part of those without part, identified with the whole community’ (Rancière, 2010, p. 37). Citizens, in this account, could represent ‘a part of those without part’ by refusing to act as consumer-citizens and instead acting as equal participants who have a duty to democratically influence economic relations and practices. Financially literate citizens, if they are to be citizens rather than consumers, ought to challenge the current police order by attempting to create a new ‘partition of the sensible’ (Rancière, 2010, p. 36).

Claudia Ruitenberg provides a succinct explanation of the difference between the police order and politics as one in which police citizens ‘seek to resolve single issues within existing hegemonic relations, [while] political adversaries [i.e. citizens] seek to establish different hegemonic relations altogether’ (Ruitenberg, 2008, p. 280). Following these agonistic theorists, what we need is a financial literacy education that supports the creation of adversarial citizens who seek to create new subjectivities, practices, spaces and resources through promoting dissensus, rather than a consensus that reproduces the neoliberal police order which reduces citizenship to spectator consumerism. Political dissensus is a practice that does not rely on a particular space such as parliament but can take place anywhere. It is a practice that seeks to alter the space in which it is practised and the manner in which the participating subjects are viewed such that spaces thought previously private and off bounds to political ‘interference’ are turned into public, political spaces and those considered to be unequal claim their equality.

A critical financial literacy education is necessary if we are going to support citizens who ‘are a capacity for staging scenes of dissensus’ (Rancière, 2010, p. 69).[9] The school can do its part by becoming a place that fosters a sense of equality that is empowering and helps citizens understand


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that equality can be more than equal inequality and that political engagement requires more than casting votes or consuming financial products. In the place of a financial literacy education that is too often a technical and/or hermeneutic civic literacy that supports an unjust economic system, empowered citizens require a critical and emancipatory financial literacy education.

A Critical Civic Financial Literacy

Throughout this article I have argued for a critical or emancipatory literacy education to replace the technical, hermeneutic civic literacy currently being promoted in many civic-oriented financial literacy initiatives. This critical literacy shares a superficial similarity with hermeneutic education as it aims to educate students to ‘read the word and the world’ (Freire & Macedo, 1987). However, it differs in that the world is seen as socially constructed and constituted by unjust social relations requiring alteration. Thus, ‘reading the world’ signals that students will not merely learn how to read the world as it appears (as a world populated by self-interested consumer monads) but will learn to read the hierarchical social relations we have created and daily recreate which benefit the few at the expense of the many. From this perspective, the problems of poverty, insecurity, alienation and economic crises are not simply caused by individual greed, financial mismanagement or incompetence; they are problems which implicate our political and economic practices.

The reader is reminded that these problems are not ‘naturally’ imposed upon groups by ‘neutral’ capitalist forces. Capitalism is an economic and political system and as such the role of the state in creating the conditions for economic crises and its shielding of some groups (banks and financial institutions deemed ‘too big to fail’) from capitalism’s crises while shifting its destructive effects onto others (certain racialized and classed home owners, public sector workers and those who require welfare state programmes) is important knowledge for both consumers and citizens. Austerity is only a particular manifestation of the state’s role in the economy, one that visits groups and individuals differently and in ways that have little to do with whether or not they can calculate variable compound interest rates. The solution is not more government and less market; the solution depends upon citizens, who, if they are to combat the xenophobic and anti-democratic responses that arise in the fertile ‘post-crisis’ ground of unemployment, political theatre, humiliation and alienation, understand how our political economic practices, relations, institutions and discourses are implicated in the ongoing crisis.

In supporting this effort in schools, students’ experiences ought to be the subject of students’ critical analyses aimed at illuminating how their actions reproduce, negotiate or are devalued and/or influenced by unequal social, political and economic relations of power (McLaren, 1997, pp. 34-35). Thus the boundaries that limit technical training and hermeneutic inquiry are continually questioned. This does not entail that the teacher imposes his or her reading of the world on the students but rather ‘invites a judgment by asking, “what do you think about it?”’ (Biesta, 1998, p. 510). What is to be judged is not neutral but is influenced by what the teacher and students think important to ponder, judge and act on. The importance of what is analysed is not something that should be assumed but should itself be subject to critical inquiry. Teachers and students need to ask: why was this issue chosen and not another? This is not a simple process, and the violent nature of this critical inquiry, Biesta (1998) notes, is unavoidable given that the outcome (altered subjectivity) and at times the questions asked are not desired beforehand by the students or teacher.

In judging an issue’s importance, the critical financial literacy educator should be concerned to question the ways in which we frame and materially support virtues, processes and states such as civic responsibility, equality and democracy. Students are not to be filled up with how to ‘properly’ view and enact these concepts but are to be encouraged to think for themselves and question how they view and recreate the social world. However, even this is not neutral because in the place of a passive consumer-citizen the critical educator supports an active, critical citizen who is concerned with the character of his or her democracy and the space and resources he or she uses when carrying out political action (i.e. the means with which citizens alter the existing hegemonic relations that promote a certain type of citizen and political action).

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To support critical and active citizenship, the above technical and/or hermeneutic financial and economic literacy curriculum resources can be ‘opened’ up in much the same way teachers are encouraged to create open-ended mathematics problems from textbooks that provide only closed problems (e.g. changing the question 2 + 3 = __ to one asking what are the possible numeric operations that could equal 5) (Van de Walle & Lovin, 2006). More open-ended resources that encourage investigation of economic issues from a variety of perspectives, such as the National Council on Economic Education’s resource, Teaching the Ethical Foundations of Economics (Wight & Morton, 2007), can act as exemplars for teachers in their critical reconstruction of technical and/or hermeneutic resources. However, even open-ended resources that foster critical debate must continually be critiqued for what they leave out. As an example, even though the resource Teaching the Ethical Foundations of Economics facilitates critical discussion on economic justice and the merits of progressive taxation using John Rawls’s ‘veil of ignorance’, it leaves out the more radical position on economic justice: that the capitalist system (in any form) is not one that should be chosen.

Reflection and debate over ethical political economic issues, however, are not enough. Students must also act and so teachers should create or take advantage of existing opportunities to enable students to exercise their civic capacities. Already existing initiatives in the United States include the Service-Learning initiatives affiliated with various schools around the nation, which aim to empower future critical citizens through combining community service with civic action. Just as with the technical and hermeneutic curriculum resources, the examples of service-learning projects outlined on the National Service-Learning Clearinghouse’s website (ETR Associates, 2012) can be altered if need be to support more critical inquiry and action: the website’s example of students studying health issues and holding health fairs, for example, could be replaced with an investigation into which classed, raced and gendered groups are most at risk of premature death, obesity and food insecurity and the government policies and market forces that impact the health and diets of those populations. Students could then disseminate their findings to the public, relevant non-governmental organizations and/or state officials. Just as financially literate citizens require more than knowledge of stocks and bonds, so do citizens require more than knowledge of the nutritional value of fruits and vegetables; if students are going to improve the lives of those in their community, they must also understand the political, economic and social reasons that keep disadvantaged groups from accessing healthy food just as they must understand the reasons that keep them from managing economic risk.

This does not entail a wholesale jettison of education designed to present the world as it is, especially those examples of technical education that aim at ameliorating the social disadvantages certain classed, raced and gendered students face within neoliberal capitalism, while also advocating for a better world (Lucey & Giannangelo, 2006). Financial literacy education must be relevant to the world in which we live and so financial literacy educators should teach students about bonds, stocks, interest rates, food banks, welfare supports, unemployment insurance and credit but must also provide an opportunity to critically analyse the structural conditions which create, necessitate and support these forms of risk management, and a space to intervene to affect change (i.e. to experience being critical citizens). Financial literacy education ought to be an act of dissensus that supports citizens who struggle to question and change what is given in order to promote greater equality and democracy.

Notes

[1] Moreover, I do not think that the justification for an avowedly political and critical financial literacy ought to rest solely on the fact that financial literacy education when promoted as a form of civic literacy ‘colonizes’ macroeconomic and political issues. Even the financial literacy initiatives that have no civic pretensions are also problematic because regardless of the target subjectivity (consumer or citizen), we should not separate the teaching of means from the discussion and analysis of the ends of those means when the issue is political.

[2] These crises should properly include those situations such as food insecurity, unemployment, underemployment, lack of leisure time and poverty that do not substantially affect those deemed too ‘big’ or important to fail and thus disappear as effects of our collective political economic practices and reappear as individual problems requiring individual solutions such as technical and/or


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hermeneutic financial literacy instruction. For some, our political economic practices generate continual crisis.

[3] However, more troubling that any lesson plan the Foundation for Teaching Economics creates, are their 2010 voluntary National Content Standards in Economics for elementary and secondary school teachers, which ‘omit views that conflict with a neoclassical model of human behaviour, ostensibly because this is the view of a “majority of economists today” and ‘including strongly held minority views of economic processes and concepts would have confused and frustrated teachers and students’’ (Siegfried et al, 2010, pp.vi, cited in Arthur, 2012b) – an admission stated in the document’s preface.

[4] For particularly stark examples of neoliberal capitalism’s destructive effects see Chris Hedges’ analysis of ‘sacrifice zones’ in the United States (Hedges, 2012).

[5] Capitalism routinely produces plenty amidst ‘scarcity’. The world, for example, produces enough food to feed the world’s population but many routinely go hungry or starve to death (Food and Agricultural Organization, 2002, p. 9), and in the United States houses remain vacant while families live on the street or in their cars (Pelley, 2011).

[6] A phrase famously trumpeted by Margaret Thatcher (Harvey, 2007, p. 40). [7] A rise in wealth inequality is one of the defining characteristics of the neoliberal era (Dumenil &

Levy, 2004; Harvey, 2007, 2010). [8] The recent outcry at the end of 2011 when it was announced that Greece was contemplating a

national referendum on austerity measures is only a more obvious example of neoliberals’ hatred of democracy.

[9] Rancière writes that a ‘political subject is a capacity’ because politics as dissensus creates new subjectivities and so codifying the subject as a set of fixed traits is to re-enact the police order. It is precisely the identity of the known – including the subject – that is contested in politics.

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CHRIS ARTHUR is an elementary school teacher in Toronto, Canada and a PhD student at York University, Toronto. His current research interests include financial literacy education, critical theory, critical pedagogy, democracy and political philosophy. Correspondence: [email protected]

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Financial Literacy Education for Citizens