I very much like Doug Elmendorf’s explanation–to a seventh grader from Michigan–of what the budget deficit is and why kids should care about it from the perspective of their future economic well being. I don’t think I have written of this before, but I have been dismayed at the lack of any such explanation in my graduating senior’s AP government textbook. (The book defines the budget deficit and talks about budget rules and even about how deficit spending is somehow used to stimulate the economy, but it never discusses the down side of deficits from that longer-term economic perspective.)
I also happen to have my own seventh grader, who has never asked me about the budget deficit and clearly doesn’t think she should care, so I am guessing that this Michigan seventh grader who wrote to Doug doesn’t have a parent who works on fiscal policy for a living…
My favorite part of Doug’s reply was his response to the question of what can kids do to help reduce the budget deficit:
The most important thing that school-aged children can do to help reduce future deficits is to study hard and acquire the best possible education. This will help you and your classmates get better jobs when you grow up, which will help the economy grow. In turn, a stronger economy will produce higher tax receipts for the government, which will lower the deficit.
When young people get jobs, they should be sure to save some of the money they earn. Through a fun and important bit of math called compounding, savings of small amounts can grow over time into significant amounts…
People of all ages can also help to reduce the deficit by learning how the government spends money and from whom the government collects money. Understanding the current budget is essential for choosing intelligently among different ways to change programs and policies in order to reduce deficits.
That’s right — study hard, learn well, and save along the way. That’s a tough contradiction to the attitude of a typical seventh grader, but it’s good to let that message sink in well before these young people turn into older people who simultaneously don’t understand the budget deficit and don’t want to make the hard choices.