Strand PHIL.II Philanthropy and Civil Society
Standard PCS 03. Philanthropy and Economics
Benchmark HS.9 Analyze a major social issue as a "commons problem" and suggest ways the civil society sector could help to resolve it.
Students explore the benefits and costs of credit and using a credit card. The group will explore the following question: As consumers, how might the choices we make affect global poverty?
The learners will:
- explain how credit is can be both helpful and hazardous to individuals and communities depending on how it is used.
- examine the individual and global effects of overuse of credit.
- analyze credit card debt as a "commons problem" and suggest ways the civil society sector could help to resolve it.
- chart paper, display board or projector
- handful of expired credit cards (if available), photos of some (from advertisements), or a handmade substitute
- learner copies of handouts one and two
While displaying at least one credit card, read the following opinion concerning credit cards:"With a credit card I don't have to delay getting what I want. I don't have to ask myself the questions, 'Do I really want or need this?' or ‘Do I have enough money to buy this?' I can buy anything I want or need! It's great!"
Encourage the learners to respond to the statement.Is this true? False? Why?
Review the definition of credit: “the opportunity to borrow money or receive goods or services in return for a promise to pay later.”Tell students that credit provides the opportunity for people to buy something now and pay for it over time. Most people use credit for big purchases, such as houses and cars, in the form of loans. Tell them that credit cards are typically used for smaller purchases. Explain that buying on credit and postponing payment means you pay back more than you borrowed because you must pay interest to the lender. Sometimes the interest charges (also called finance charges) on a credit card are as high as 23% of the money spent. That means if you buy a shirt for $30 on a credit card, you can end up paying as much as $40 if you pay your credit card bill over time!
Optional: Explain how credit card interest works.
Brainstorm a list of pros and cons of using credit cards.Continue the discussion by asking students to share some problems with credit cards that they have either personally encountered or that they have seen/heard others having.List these comments on the display board.
Ask students if their responsible spending affects anyone else. Does responsibility with money influence the common good? Define common good. How could others' irresponsible spending affect them?
Share the following statistics about credit cards and the US economy:
- The size of the total consumer debt grew nearly five times in size from 1980 ($355 billion) to 2001 ($1.7 trillion). Consumer debt in 2009 stood at $2.5 trillion.
- The average household in 2009 carried nearly $5,100 in credit card debt.
- As of the twelve months ending June 2006, there were 1.5 million consumer bankruptcy filings.
Give students copies of the handouts to read in small groups (different groups may read different handouts). Give them time to discuss the reading in the context of debt and responsible spending. Ask the groups to reflect on (and be ready to share) the effect of personal spending and debt on the "commons." What responsibility do we have to the common good?