One of the more-common social science cliches in recent decades has been “demographics is destiny.”
The thesis, as Oxford University gerontologist Sarah Harper has written, is that “population change plays a key role in our political systems, economies, and societies at the local, national, regional, and global level.”
There’s no reason to argue with Professor Harper’s premise. But let me offer a different version of futurism: economics is destiny.
Economics teaches a single fundamental fact: everything has a cost. Every decision you make, as an individual, business leader, policy maker, or government official, sets you on a path that opens some opportunities and closes others.
Over time these choices compound, just like interest. Some may attribute successful compounding choices to “luck,” but choices, good and bad, are the result of intentional decisions made over time – decisions that preclude choosing other things.
What you choose is the result of your evaluation of the choices you see as available to you. Only you, the individual, can make the most informed decision for yourself – although it may be wrong. Although you may, in the end, exercise either wise or poor judgement, you are the only person capable of knowing what is best or more valuable for you.
Consider this: total household debt in the United States, excluding mortgages, topped $4.96 trillion at the end of the third quarter of 2024, the Federal Reserve Bank of New York recently reported. “Credit card balances increased by $24 billion to hit $1.17 trillion,” the New York Fed reported, “and auto loan balances saw an $18 billion increase and stood at $1.64 trillion.” Student loan balances also increased: by $21 billion, ticking up to $1.61 trillion.
These are all outcomes of many choices.
And that’s just household debt. The federal government, from which some debt-strapped Americans seek financial help, also is drowning in debt — more than $36 trillion and counting, according to US Treasury Department figures.
US and global policymakers speak of such amounts with a casualness that sounds like they could be discussing their weekly shopping lists.
I bring this up not to engage in an argument about whether debt, per se, is good or bad. Virtually everybody has some debt. Debt financing is commonplace and often necessary in business and industry. But the huge numbers we hear around the topic are almost unfathomable to most people.
In fact, many of the economic issues mentioned during the recent election campaign were foreign to many voters. Sure, they’d been stung (ravaged in some cases) by inflation. But do they understand what causes inflation? Do they realize that when politicians brag about inflation “coming down,” it doesn’t mean prices are coming down? Do they know what tariffs are or the role of the Federal Reserve?
Regrettably, one of the academic subjects that has been downgraded in recent years as US schools have leaned into the STEM disciplines (science, technology, engineering, math), has been economics. Just 27 states and the District of Columbia require some form of economics or personal finance coursework, often included in the social studies curriculum, for students to graduate from high school, according to the Education Commission of the States.
The National Assessment of Educational Progress (NAEP), an arm of the US Department of Education, periodically tests fourth, eight, and twelfth-grade students in a variety of subjects. The last time NAEP evaluated the economic literacy of twelfth-graders was in 2012, when 58 percent of the approximately 11,000 students tested failed to qualify as “proficient” in the subject.
Yet, the twelfth-grade tests are key, because they evaluate what America’s young adults know as they prepare to enter the job market or college. In fact, many of the students tested in 2012 just voted in their third presidential election.
Economics should be considered a core high school subject, alongside US history and government. Failure to teach it robs American students of knowledge they need for responsible adult citizenship–and life in general.
Economics is destiny. We shortchange America’s children, and our future, if we don’t teach students the most valuable lesson of all: everything has a cost.
