Some differences between being educated and being literate

Educated means you have gone through some form of supposedly rigorous instruction.

Literate means you know how to read (both functionally and critically) and presumably that you are at least moderately well read.

Can an individual be one of these things without being the other? Of course. Practically tough, this is rather uncommon.

In prior eras these distinctions were much more meaningful when schooling was not compulsory. Nowadays, most people's literacy is developed through school.

It sounds like the quote your referencing is probably being used to either disparage someone by implying he or she is either uneducated or illiterate because he or she is either educated or literate.

People that throw around such cliches are usually trying to win some type of argument they are having a difficult time with. So instead of debating the merits and flaws of the argument, they choose to attack the qualifications of the person they're arguing against. These days, depending upon who you're arguing with, being educated can either support or undermine you in some people's eyes.

Could a person be formally educated and yet remain functionally illiterate? Sadly, yes this is possible. Can a person without a formal education be highly literate? Fortunately, yes, this is possible as well. In practice, in the USA and most of the developed world, these scenarios are less and less likely.

I think the more important question is: Can a person be literate and/or educated and yet still be completely ignorant about some subject or subjects? Of course the answer to this is yes and only a fool would suggest otherwise. Unfortunately, I find that people who are reluctant to admit their lack of actual knowledge or experience about a specific subject are inclined to employ the types of cliches you mentioned in order to attack the position of someone who actually does know what he or she is talking about.