THE AVERAGE AMERICAN IS AN ECONOMIC IGNORAMUS, and a study report about to be released by the Commerce Department and the Advertising Council purports to prove it. High-lights of the study, made last November and December among some 3,000 persons, are:

·    Only one in seven really understands the roles of business, labor, investors, and consumers in the economy.

·    Even among businessmen and the best educated, only one-third understand how the economic system works.

·    Economic illiteracy is found in all segments of the economy, but particularly among low-income groups, the elderly and retired, homemakers, those with little education, blacks, those inactive in community affairs.

·    Most Americans consider the essential benefits of the economic system to be their personal freedoms and opportunities rather than broad functional aspects such as a free, competitive market or the availability of a wide assortment of goods and services provided through profit incentives.

IN SHORT, most Americans think of the system as making it possible for anyone to choose or change his job, start a business, and improve his lot by his own initiative. What knowledge of economics the average person does have seems to come from personal experience, the study indicates. This includes experiences as a worker, consumer, etc.; personal activity in the community in political campaigns, civic organizations, contact with legislators, school board meetings, etc.; and formal education, but only higher education involving economics courses.

LOOK FOR THE STUDY AT ABOUT THE END OF JULY. It shows that the great majority of Americans also have complaints about the system—most dealing with the current economic situation. According to the report, they seem to be saying: "We like our system be-cause it gives us freedom and opportunity. But it's not working right these days. We have inflation and unemployment. Big business and the wealthy have gotten too much power and have unfair tax advantages. Foreign aid and imports have made problems for us. Welfare programs have gotten out of hand. Unions have too much control. The system is basically good. It should be made to work again."

UNFORTUNATELY, MORE THAN HALF of those surveyed believe that government should regulate the economy more than it does. Only a third thought there is already too much govern­ment interference. This general lack of understanding of economics seems to be at the root of the widespread feeling of frustration over current conditions, analysis of the study seems to indicate.

THE REASON FOR THE STUDY was to find out just how much people understand about the system in order to develop an information and education program sponsored by various organ­izations. Ad Council Campaign Manager Al Podesta told Washington Focus that the Commerce Dept. provided the initial funding in the hope that other agencies and the private sector would contribute to the $2-million project to be completed within three to five years.

Alvin M. Hattal

PUBLIC RELATIONS JOURNAL

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