KUDOS. The Illinois Council on Economic Education recognizes Chicago Treasurer Judith C. Rice as the 2005 Economics Ambassador.

The Economics Ambassador Award was established in 2004 by the ICEE Boards to recognize public officials who have provided extraordinary advocacy and support for economic and financial literacy education for Illinois youth. The 2005 award is the inaugural presentation of this new recognition.

There's still a lot of work to be done, in Chicago, and elsewhere.

Fifteen states require economics, up from 13 in 1998. Last year, at least a third of all high school graduates had taken a class in economics because the four largest states — California, Texas, New York and Florida — require it.

At the same time, 38 states have standards for personal finance education, up from 21 in 1998. Almost all states have standards for economics. To have a standard means the state's legislature has declared the subject an important one that should be taught, although it is not required.

Still, most kids start college or go to work after high school with only rudimentary understanding of things such as savings accounts, credit cards, the stock market, saving for retirement or getting a car loan. "We all know young people are getting inundated with credit card offers at college," says Joanne Dempsey, president of the Illinois Council on Economic Education. "It's 'Get a free T-shirt! Sign on the line!' You can spend $2,000 without realizing someone has to pay for all this."

Young people may be woefully unprepared for taking charge of their own money, much less their retirement, says Donald Zabelin, who teaches consumer education at Community High School in West Chicago. When he asks his juniors and seniors about money matters, he gets a lot of blank stares. "They really don't know much," he says. "A handful may pick something up from their parents. But for most families, money is a topic that can be put aside because there are more important things to talk about."

Patricia Tomich agrees.

Her students at Notre Dame High School for Girls in Chicago come from working-class families, many of whom "live paycheck to paycheck," she says. "We give them confidence as young women to go out in the world and say, 'I'm not just going to spend, spend, spend.' There are other ways to go."

Zabelin and Tomich teach everything from how to write a check to concepts such as investing in the stock market and buying stocks on margin.

Perhaps the lack of understanding of investments contributes to public resistance to private retirement accounts. This morning, Representative Sander Levin of Michigan delivered the Democratic radio message for the week. Its theme: private retirement accounts are unsound as well as more complicated than a relatively simple government program that pays current retirees out of current taxes. Perhaps the message that the excess burden of Social Security taxes includes a dampening of economic growth fails to resonate with people because the whole response of many people to capital formation is "huh?"

Don't get me started on income accounting. Suppose one increases the current Social Security tax base (it doesn't matter which proposal one adopts) and sets up a bona fide trust fund in which the additional tax payments are exactly offset by additional holdings of government bonds by the trustees of the trust fund. What happens when the trustees redeem the bonds?