Schools and universities in the United States are trying to teach something that as yet has no place on Britain's curricula. It is called character education, and what they mean is the cultivation of the characteristics needed to be a good citizen.

Here in Britain we feel uneasy about anything quite so moralistic. We are more at ease with the idea that you teach citizenship by attending classes on how parliament works, or that sex education is solely about the mechanics of sex and avoiding sexually transmitted diseases.

But there is no shortage of evidence on both sides of the Atlantic that something is going seriously wrong with the way we bring children up. One symptom is the lack of understanding of basic moral principles; here, for example, many young people are intensely moral on animal and environmental issues, yet see it as acceptable to defraud insurance or tax.

Another is the failure to understand basic principles of reciprocity. In the US, for example, most students believe they have a right to trial by jury, but resent the assumption that they should have an obligation to sit on a jury. There is also a lack of interest in politics and international affairs. But just as important, is that few people are organising their lives to be challenging and fulfilling. The average citizen, for example, spends over 20 hours each week watching television, even though all the surveys show that this is far less fulfilling than activities such as sport, music or community groups. Few also seem well prepared to negotiate their way through the complexities of relationships and parenting.

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Character education addresses these issues in two ways. It aims to encourage empathy on the one hand and on the other to foster self-discipline: the capacity to sacrifice immediate pleasures for longer term rewards, and to focus energy on genuinely useful and rewarding activities. Both of these are learned less through the curriculum or special classes than through things that often seem peripheral and that usually take place outside school or university: sports, extra-curricular activities, running and organising things, and working with people from different backgrounds.

The good news is that empathy and self-discipline can be deliberately cultivated. But the bad news is that nearly all of the pressures on schools and universities are pushing in the opposite direction in an obsession with exam results.

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At Demos, we have just set up a forum to look at how to promote a very different version of education in Britain. Chaired by David Hunt MP, the group includes politicians and educationists. We have found no shortage of good schemes, from the public schools to the poorest inner cities. But not enough has been done to analyse and evaluate these and to think through how public policy can help.

The US has different community service schemes through which students can pay off their fees. They have avoided the trap of making community service something just for the poor and unemployed and successfully tapped into an important seam of social energy. But there is a worrying lesson from the US. Although the schemes proved very popular with students, the mainly middle-aged media were at best cynical and at worst dismissive.

It would be a shame if the same happened here. A healthy democracy cannot rest on an education system that only rewards individualistic academic achievement, and in a healthy society morality is far too important to be left to the moralisers.

Geoff Mulgan is director of Demos, the independent think tank.

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