In 1969, Elvis Presley recorded a haunting hit, “In the Ghetto” (with lyrics by Mac Davis). It spoke of the cycle of poverty. In the song, a boy, born in a Chicago ghetto lives a bleak and doomed life. He is killed, ironically, just as another child is born to suffer the same fate.

Today, many people live in information ghettos created by illiteracy, a kind of intellectual poverty. This often leads to a life of crime. Did you know, for instance, that the Texas Department of Corrections determines how many jail cells it will need ten years from now by assessing fourth grade reading scores? (Download Dismantling The Cradle-to-Prison Pipeline, by the American Leadership Forum Class XXV and The Children’s Defense Fund, 2009, p4; edited and designed by Rehak Creative Services).

As I was writing yesterday’s post about media illiteracy, suddenly another thought hit me like Charlie Chaplin’s piano falling out of the sky. “How many people can’t read?” If you can’t read, you can’t function in the Information Age.

So I googled “percent of Houstonians who are illiterate” and found this.

“Now more than ever literacy remains an issue for the Houston community. One in three adult Houstonians is functionally illiterate (from the National Adult Literacy Survey 2003).” Quoted at the Neuhaus Education Center in Bellaire, Texas.

Functionally illiterate people must rely on media such as television, radio, personal experience, conversations with others and images to get information. They cannot understand the richly detailed volumes of printed information in newspapers, books, libraries and on the Internet. It’s much more difficult for them to seek out information to learn new skills, become more productive, solve new problems, help other people, and fend off those trying to take advantage of them. They cannot evaluate the truth or falsity of information from as many points of view as you or I can. (See Triangulating on Truth in the Personal Essay section of this blog.)

“Functional illiteracy” is like the term “walking wounded.” It implies a small degree of sufficiency, but certainly not proficiency. It means being able to function at a low level, but not prosper at a high level. For instance, people may recognize the meaning of a stop sign, but not the intricacies of an adjustable rate mortgage. Thus, they would be vulnerable to predatory lending practices. The one-in-three estimate above helps explain, in part, the depth of the recent global financial crisis.

A brilliant documentary I viewed recently called The Flaw (Beak Street Films, 2011, directed by David Sington) contains interviews with homeowners around the country who got under water on their mortgages because:

• They didn’t fully understand the implications of adjustable rate mortgages.
• Media coverage focused on returns, not risk, fueling an unsustainable run-up in  prices that led to a housing bubble.
• People assumed they could get out of the market before the bubble burst but failed to recognize early warnings.

In retrospect, it seems foolish that people didn’t see the risk. Heck, almost everyone believed the hype, not just consumers.

I would argue that the term “functionally illiterate” should apply to everyone who cannot understand signals needed to do their jobs properly or protect their interests.

Functional illiteracy within a financial niche contributed to many peoples’ failure to send up, see, or comprehend the significance of red flags. Underfunded buyers continued being sucked into the vortex of the American dream-turned-nightmare. That’s functional illiteracy on a thermonuclear, alter-the-course-of-global-evolution, let’s-all-drink-the-Kool-Aid scale. Sing it, Elvis:

“As her young man dies,
On a cold and gray Chicago mornin’,
Another little baby child is born
In the ghetto
And his mama cries”