The launch of fintechblue, about Bitcoin, P2P lending and payments

Posting has been sporadic lately, which I’m not happy about, but I’ve been working flat out on a technology development project (maybe I’ll tell you more about that later), and the launch of my Bitcoin and fintech blog. It’s called fintechblue and you can see it here.

cropped-fintechblue-cover-21

I’m not rolling those posts into this blog because the seriously nerdy depth of detail is not appropriate for a general technology commentary. And once I find a rhythm I’m comfortable with, I’ll go back to posting like crazy here, too. I miss it, actually – I have a bunch of posts half-finished, just aching for an insightful and hopeful conclusion. I have no problem with the hopeful, but I have over the past few weeks struggled with finding the head-space for insightful.

Tomorrow I’m off to give a talk in Bilbao on how technology as affected the growth of personal branding and the importance of the “company”. Then London for a few days for meetings. Then back to work, hopefully this time with insight, early next week.

Until then!

Friday five: Internet, ads and future cities

The fake-ness of targeted ads – via Bloomberg Business

A visually stunning indictment of the online ad industry, Bloomberg-style. Not only do we not pay attention to online ads anymore, but the figures the advertisers pay for are way off. Bots and bought traffic inflate the advertising income while having no impact whatsoever on its efficacy. Depressing.

image via Bloomberg Business

image via Bloomberg Business

Advertisers feel ripped off and consumers hate them. So is the end of online ads? I hope so.

But then again, how will web pages support themselves? If online advertisers stop advertising, what will happen to web content? Possibly a move to quality?

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TV vs Internet, via New York Books

An epic (and very long) look at the state of the television industry, and related media. The article compares two industry analysts’ views: one (Michael Wolff) insistent that core television is here to stay, and that faddish new media will continue to be unsuccessful in changing habits…

“But despite sharing the vulnerabilities of other long-standing media—shrinking audiences, changing consumption patterns, new competition for ad dollars—the television dinosaur has only grown fatter.”

… the other (Alan Wolk) looking to the new television model:

“When it comes to advertising revenues, declining audiences have so far had an ambiguous impact, sometimes driving up advertising prices for demographic segments that are becoming harder to reach, like children. But this is a melting iceberg model: shrinking real estate may drive prices higher, but at some point, there’s not much ground left to stand on. “

Wolff stresses the improving quality of the content (which probably shows that he doesn’t actually watch much TV) vs the “flakiness” encouraged by the online ad model. And that the online business model doesn’t work, while television is doing very well, thank you.

He doesn’t take into account, though, that nothing lasts forever. TV viewership is down 20% in the profitable 18-49 category. And “watching television” is starting to blend more and more with “going online”, with Netflix and similar offering quality and choice on your tablet or PC, and YouTube going more long-form. Assuming that TV is not already undergoing a significant disruption speaks of limited awareness of where the younger generation gets its entertainment and information. Saying that TV is “better” than its online equivalent is making a judgement call appropriate for his generation, not necessarily all generations. If TV ends up being the medium of choice for the elderly, the advertising income will go to where the young eyeballs are.

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The future of cities, via Wired

Cities are changing. And that’s exciting. More attention is being placed on the combination of design and utility, with statement, community and environment all jostling for place on the podium. This collection of ideas and articles is surprising, awe-inspiring, envy-inducing and sometimes just plain weird.

image via Wired

image via Wired

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The Internet of tomorrow, via TechCrunch

“Ask 30-year-olds how much time they spend online and it’s a big number, ask 18-year-olds and it’s greater still, but ask 12-year-olds and they can’t tell you, because, for them, there is no concept of online.”

Tom Goodwin introduces the concept of the “Thinternet”, the everywhere, thinly-spread content and coverage. What vertical portals did to help the adaptation of real-world media to the online format, horizontal splicing will do to the experience-based personal web. Ubiquitous connectivity, universal digitalization, aggregation and high-end UX combine to eliminate the barriers between the real world and the online one.

Is that scary or is that hopeful? To the future users, it’s probably neither. It just is.

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Introducing… the napdesk. Work, then rest, then work, then rest… Ideal for workaholics. Or for people who like to take a break during the day. :)

image via My Modern Met

image via My Modern Met

(via My Modern Met)

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Have an amazing and restful weekend, everyone!

Friday five: bacon, clocks and comments

We live in a weird, wondrous world that never ceases to surprise me…

So, dating just got weirder – via TechCrunch

The impact of the Internet on dating is fascinating. I wrote about it here, and I’m realizing that I barely scratched the surface. With the news that Oscar Mayer is launching a dating app for bacon-lovers (called Sizzl, really), I’m not sure if it’s getting silly, or deep. Maybe a bit of both. Will other brands take note? If so, which would you consider using?

image via TechCrunch

image via TechCrunch

I wonder why Nespresso hasn’t thought of this… A Nutella dating site would probably do quite well, too…

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The sharing economy is dead – from Fast Company

An excellent article about good intentions and resistance to change. The sharing economy was going to make us all more efficient and empathetic, sharing our goods and our time and receiving like in return. And the connections would make us feel more in touch with our environment and our community…

Most of the sharing economy businesses born in the flurry of the mid-2000s are now closed, largely because of what the author calls “a discomforting incongruity between enthusiasm for the concept and actual use”. Is it really worth sacrificing a chunk of our day to go and pick up and then return a drill that we rent for $15, when we can get a cheap one at the department store or on Amazon for $30?

Personally I think that yes, there are many who would. And maybe the drill renter lives across the hallway. I think that the barriers of hassle and time are an important factor, but not quite as much as the mental barrier of changing our ways. Improved usability will help – more than 3 clicks and it’s easier to turn to Amazon. But mainly, it will take some time for the idea of sharing and relying on others to sink in. It’s a big leap, not to be underestimated. But I think that it will happen. The first flurry of sharing economy startups were probably too soon. More will follow, and will most likely do better. Especially if they stop using the term “sharing economy”.

“But the real sharing economy is dead.

It was a beautiful idea that struck hard, but when it died, nobody seemed to notice… And nobody seemed to ask the question of how an idea that everybody loved so much, an idea that made so much sense on a practical and social level, morphed into the pure capitalism that it is today.”

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#IstandwithAhmed – via Wired

I confess that when I first saw this story yesterday, I thought it sounded a bit like a hoax. Because, well, um…. I still find it baffling.

image vs Wired

image vs Wired

Wired’s spin on the tale, including tweets of support from tech dignitaries, is quite charming. What a way to reach celebrity. And what a way to raise awareness for the coolness that is robotics.

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To comment or not to comment? – from Nieman Lab

This article is a long read, but it turned me around on an issue, which is why I want to share it with you.

I read a lot of media on the web. News, creative journalism, research, opinion pieces… and the comments. I often find myself learning as much from the comments as from the original piece. While reading a beautifully crafted opinion piece that I totally agree with, the comments show me other aspects of the situation, new arguments that give depth to whatever understanding I might think I have.

So it was with dismay that I noticed that many of my favourite sites were turning off the comments section. I thought it was a bad idea, that it would reduce overall engagement, that readers would spend less time on the site. But then I read this article in Nieman Lab.

I’m still not convinced it was the right thing to do, but at least I see the strong arguments in favour now. I get the need to broaden engagement on other social platforms. I understand the drain on resources posed by trolls and idiots non-sensible commenters. But the “we need to go where the readers are”? We’re on your site! Yes, Twitter has a broader reach. But it is feasible to cultivate both the commenters and the tweeters. Sometimes they’re the same person. It’s possible to comment on an article, and then tweet about the comment. A couple of strategically placed buttons would make that even easier.

Sure, moving comments threads to dedicated forums or even Facebook pages will increase activity in those groups. But if I read an article and have an idea I’d like to share, I’m not going to go somewhere else to do so. If it isn’t super-easy and intuitive, I’m not going to bother.

But, the explanations given by The Verge, Popular Science,  do make sense. Mobile audiences, the need to focus on social media, anonymous comment abuse, lack of resources for moderation… I do hope this trend doesn’t extend to all online media, though… I would miss the debate.

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To Uber or not to Uber? – by Enrique Dans

Yes!! Innovation: 1, Entrenched interests: 0. Uber is illegal in my city of Madrid, Spain, although the European Court of Justice is reviewing the case. And I hope that the European Courts lean the same way as the New York courts that Enrique Dans talks about in this article.

“Any expectation that the medallion would function as a shield against the rapid technological advances of the modern world would not have been reasonable.”

I understand the plight of the licensed taxi drivers, faced with reduced return on the outrageous investment required for a license. In return for the additional tax income the government would get with a broader use of alternative taxi services (Uber’s price point is in between taxis and public transport), perhaps they could find a way to reduce the financial burden on taxi drivers?

“Quite simply, the financial interests of some do not take precedence over the right of consumers to choose how they wish to be transported. The public cannot be denied a service they have clearly shown a preference for and that manifestly lacks any pernicious effect over other alternatives, just because a few people’s investment might depreciate as a result. The fact that some sectors in society do not want things to change doesn’t mean that things won’t change or shouldn’t change.”

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Things ain’t what they seem – via The Atlantic

Noooooo! It can’t be!!! My life has been a lie!!! My beloved London underground map…

image via The Atlantic

image via The Atlantic

…in reality looks like this:

image via The Atlantic

image via The Atlantic

This is too much for me to take. I need to go and lie down.

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Have a great weekend, everybody! Oh, and by the way, I’ve started writing about bitcoin over at fintechblue… It’s early still, so don’t check it out yet, but… well, soon, okay? And I will keep on writing here as well!

Bitcoin, banks and Barclays: a perplexing relationship

One of the most difficult aspects of setting up a Bitcoin-related company is finding a bank that will work with you. Simple things like collecting revenues and investment, and paying suppliers and employees, become insurmountable barriers. Because setting up a tech startup isn’t hard enough, right? And it’s not like the Bitcoin technology is easy or anything…

(If you’re not familiar with Bitcoin*, here’s a pretty good introduction.)

So it was with delight that I read earlier this week that Barclays would start accepting bitcoins into bank accounts. This was potentially huge, because actually accepting bitcoins* is a huge leap forward compared to other banks, who won’t even accept dollars that have just been converted from bitcoins. I could almost hear the ripples of excitement going through the rapidly growing bitcoin startup sector.

photo by Milada Vigerova for Unsplash

photo by Milada Vigerova for Unsplash

But the excitement was premature. CryptoCoinsNews and others announced soon after that Barclays has denied this. If this denial is true, it is a huge blow to many who were expecting startup operations to get easier. And it is confusing to those of us following banks’ interest in Bitcoin, because Barclays is one of the leaders in the banking sector in Bitcoin investigation and experimentation.

How can an institution invest in a technology, yet at the same time turn away business because it feels that the technology is too risky?

The technology that Barclays is investing in is the blockchain behind Bitcoin. More and more banks, governments and exchanges are looking into how the blockchain can revolutionize payments, asset transfers, trade settlements, etc. Bitcoin works because transactions are grouped into transparent blocks that are then processed by a decentralized community of powerful computers. These blocks, once verified, get added on to an ever-increasing chain of previous blocks. The chain makes it impossible to alter previous blocks without altering every block that comes after, which would be prohibitively difficult. And the verification process makes it prohibitively difficult to duplicate coins or to spend coins more than once. I will talk about this more in future posts, but perhaps you can already see why banks are interested in the blockchain potential for faster asset transfer and settlement.

Investment aside, the business that Barclays (and other banks) are turning away is that of a volatile currency. Bitcoin went from $13 to almost $1,000 over the course of 2013, and is now trading at around $230. That’s volatile. Businesses that earn bitcoin are therefore categorized as “high risk”. Combine that with the public perception that bitcoin is mainly used for criminal activity, and with banks fearful of public criticism and regulatory investigation, and the institutional reluctance to hold accounts for Bitcoin companies starts to become a bit more understandable. Banks are not known for their risk-taking intrepidity.

Yet, nor do they want to be innovated out of existence. Banks in general seem to be aware that blockchain technology has potential, and they have no doubt been following the headlines of valiant startups intent on shaking up the staid financial industry. So, cautious investment in the equivalent of “Research & Development” keeps them involved and gives them a reputation for being forward-thinking, without leaving their core business vulnerable to public or regulatory criticism.

So why the precipitate announcement? Maybe the press’ eagerness to announce good news for the sector led to the hasty interpretation of “we are looking into” as “we will” (my daughter does this all the time). Barclays has clarified that it is investigating a Proof of Concept (which means “let’s test it”) together with some of its charity clients, to see how Bitcoin could help them with fund raising and disbursement. It’s easy to interpret from that they will soon start allowing select clients to accept bitcoin for altruistic causes if, indeed, it does turn out to be an efficient transfer mechanism. But, Barclays has not committed either way.

Barclays has the advantage of being a UK-based bank. The UK government has repeatedly expressed an interest in Bitcoin, going as far to set up a £10m research initiative. So, if it’s regulatory approval that Barclays is waiting for, it probably won’t have to wait for much longer.

In the denial, Barclays stressed that “no Bitcoin is travelling through Barclay’s systems”. That emphasis is revealing, and underlines the understandable reluctance on the part of any publicly-traded bank to let the market think that it was holding such a volatile asset, either on behalf of clients or for its own book.

Yet the reluctance is still perplexing. Most banks now have entire teams dedicated to Bitcoin research. In most cases they are looking into applications rather than the digital currency itself, but even so, they must be aware that Bitcoin is no more about criminal activity than cash is. Obviously, working with a Bitcoin-related business does not mean the bank account holds bitcoin – the bitcoin wallets can do that. These companies need currency accounts to accept payments with which to pay suppliers and employees, not to mention taxes. With KYC/AML (Know-Your-Client/Anti-Money-Laundering) regulations in force in most developed countries, the banks should feel relatively protected against illicit activity.

It will be interesting to see in what way Barclays lets its charity clients accept the digital currency. Will it act as a bitcoin wallet? Or merely a bitcoin exchange, transferring the bitcoin into pounds?

In June, Barclays announced that it has teamed up with Safello, a graduate from its fintech accelerator, to test blockchain applications for banking. Ironically, Safello, a Stockholm-based bitcoin exchange, had its account shut down by its UK bank (name withheld) earlier this year.

Perhaps Safello will play a role in Barclays’ careful Bitcoin acceptance, or perhaps the bank will end up incorporating other Bitcoin players into its stable. Either way, it looks like Barclays is in the lead when it comes to offering bitcoin-related services to its clients.

Elsewhere, young Bitcoin startups are still struggling to get the basic level of service any business needs from its bank. Perhaps more startups will start to look at this as an opportunity. The lack of banking services for the Bitcoin community could lead to the development of a new subset of startups: the Bitcoin banks. Decentralized, hack-proof and unregulated. Appealing, or scary?

 

(*You’ll notice how sometimes Bitcoin is written with a capital B and sometimes lower case. The convention is that when you’re talking about the system of Bitcoin, the protocol and the concept, you capitalize it, because it’s a name. But if you’re referring to the currency, as in “I’m sending you two bitcoin”, then it is lower case because it’s a thing. In another post we’ll go into the craziness of this naming system. Because, as you will see, even I get confused sometimes often.)

Friday five: bubbles, podcasts and memes

Some lovely entries this week, with more of a leaning toward the frivolous than the deep (although it is possible to be both, right?):

The Facepalm Years – by Adam Westbrook for The Memo

Adam Westbrook wanted to come up with something to put in a digital time capsule that would represent our decade, now that we’re more than half-way through. This is his suggestion:

image via The Memo

image via The Memo

Why?

  • It represents our decade’s obsession with .gifs.
  • It sums up the ridiculousness of valuation bubbles.
  • It pokes fun at the fashion sense of hipsterdom.
  • It explores the growth of the visualisation of conversation (emojis, anyone?).
  • It underlines fatigued disappointment when words will not suffice.
  • This is the decade of the remix.

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This time it’s different – by Nick Bilton for Vanity Fair

An epic tale of hubris and impatience, sprinkled with wealth and innovation.

“This time it’s different”: A decrease in IPOs… Money flowing backward… The explosive growth of mobile phones… A sense of social good…

And a new financial structure. The quantitative easing and the relaxing of investment regulations for funds and governments have led to a lot of money searching for the mythical returns of venture capital. The prevalence of late-stage private financing vs IPOs is worrying in that the accounts never get public scrutiny, and the high valuations are in many cases totally arbitrary. Furthermore, as Nick points out:

The problem with being a unicorn, indeed, is that there aren’t many exit strategies. Either you can go public, which is inadvisable without a lot of revenue, or you can sell, which is difficult given the paucity of companies that can afford to make such an offer. So, for many, the choice becomes fairly simple. You continue to raise more and more money, or you die.

So, can this continue? Unconventional but statistically relevant indicators that we are in a bubble include an inflated art market, extravagant parties, and an increase in the number of prostitutes.

And did you know that virtually every bubble bursting has been preceeded by the attempt to build the tallest buildings? Witness the construction of the Salesforce Tower in San Francisco, 200 feet higher than the Transamerica pyramid.

I love Nick’s synthesis of the current startup mega-trend:

“All across the Valley, the majority of big start-ups are actually glorified distribution companies that are trying, in some sense, to copy what Domino’s Pizza mastered in the 1980s when it delivered a hot pie to your door in 30 minutes or less. Uber, Lyft, Sidecar, Luxe, Amazon Fresh, Google Express, TaskRabbit, Postmates, Instacart, SpoonRocket, Caviar, DoorDash, Munchery, Sprig, Washio, and Shyp, among others, are really just using algorithms to deliver things, or services, to places as quickly as possible. Or maybe it’s simpler than that. As one technologist overheard and posted on Twitter, “SF tech culture is focused on solving one problem: What is my mother no longer doing for me?””

Personally, I’m starting to collect bubble stories. Maybe there’ll soon be a reckoning, maybe not. Either way, it will be fun to look over these a year from now. Or two. Or five. You can see my collection on my Flipboard magazine “Tech bubbles“.

flipboard bubbles

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Today’s Internet Is Tomorrow’s Aesthetic – by John Herman for The Awl

This article is almost poetry. It talks about blog/reblog aesthetics of Tumblr, and makes me want to (almost, sort-of) give Tumblr another try.

image via The Awl

image via The Awl

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Trivia – from The Guardian

Wanna hear a fun fact? Google now has a “fun fact” feature, for those down-time moments when you could use a little intellectual stimulation. Just type in “fun fact” or “I’m feeling curious” into the search bar, and feel your brain grow.

fun fact

(Go on, tell me you knew that one!)

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The Boom in Podcasts – via Medium

If you had any doubts about the boom in podcasts, this graph should dispel them:

graph via Medium

graph via Medium

I’ve written before about how pleased I am that podcasts are now a “thing”. I can’t begin to tell you how much more walking I get done. And how good some of them are. I’m currently racing through Alex Blumberg’s first season of Startup, which is entertaining, slick and at times painfully real (been there!).

I was surprised at the breakdown of popular categories, and then I was surprised that I was surprised: Christianity came a comfortable #1, well ahead of the #2 category Music. My preferred sector, tech news, didn’t even make it into the Top 10. It used to be way up there, because podcasts were a geeky thing to listen to. Altogether now, let’s say “mainstream”.

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Hipster Barbie’s Instagram Account – from Wired

One day I’ll share with you my favourite Instagram accounts. This is now one of them: @socalitybarbie.

hipster barbie

@socalitybarbie

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Enjoy the weekend! Yay, September! (I miss August!)

Marketplace student finance and the meaning of life

Tears (mine, hidden) and glasses of wine (mine, also hidden) are the main things I remember about helping my son pack up his room prior to his triumphant exit from childhood life into the scary world of the university student. A traumatic and at the same time exciting moment for parents around the world as they see their baby transform almost overnight into (gasp!) a grown-up, or close enough, anyway. I still am unable to watch Toy Story 3 without bawling my eyes out. And, honestly, my tears have nothing to do with the student debt we as a family have had to incur.

image from deathtothestockphoto.com

image from deathtothestockphoto.com

Because we’re among the very lucky ones. My son studies in the UK, where tuition has gone up a whopping 300% over the past few years, but is still a relatively reasonable £9,000 a year. And the UK government does offer subsidized loans, even to European students, to cover the tuition. These loans need to be repaid once he starts earning above a certain amount, and increase in line with his income. To be honest, it sounds very fair.

Again, we’re lucky. You’re probably familiar with the horror stories of students being saddled with debt for the rest of their lives, of nightmare collection practices that do not care about the financial well-being of their targets, and of the ballooning economic problem of defaults. You’ve no doubt seen the headlines about the student loan crisis in the US – it is the second largest source of debt, behind mortgages and ahead of credit cards. Outstanding federal student loans have almost reached $1.3 trillion, almost 17% of which is not being paid back. And there doesn’t seem to be any let-up in the growth on the horizon, as a college degree becomes more of a necessity, and as the cost of these degrees increases.

You’ve also probably heard about the effect on financing that the P2P lending platforms are having, about the democratisation of debt, the reduction in cost, the increase in speed and the spread of transparency. P2P lending platforms allow individuals and non-bank institutions to lend directly to individuals or businesses, achieving reasonable rates of return on their funds and contributing to the economic ripple effect from an increase in the circulation of money.

Here’s the thing: P2P lending has already moved into the scary but potentially lucrative area of student loans. And while I think that P2P finance is so much more than just an innovation (I’ve written about it here and here), this development has got me thinking.

Strangely enough, it’s got me thinking about the value of a liberal arts education.

I’ll explain:

P2P (peer-to-peer) lending matches people and businesses who need a loan (to expand inventory, to buy a car, to refinance old debt) with investors who are looking for a higher return on their money than they could get by parking it in a savings account (which here in Europe pays virtually nothing). It’s a brilliant idea, and is taking off, with 128% growth in lending in the US in 2014, 144% in Europe, over $2 trillion of VC funding and at least 3 platforms already quoting on public stock exchanges.

The P2P platforms that focus on student financing work pretty much the same way. Investors (usually institutions, or wealthy alumni) lend money to (usually graduate) students in exchange for interest-bearing repayment once they graduate. As I’ve written about before, the “P2P” part seems to be fading: Sofi, one of the largest platforms, started out aiming to pair alumni with students, but discovered that it was simpler to allow institutional money to benefit from the relatively good rates. CommonBond is increasingly relying on institutional funds, but still strives to cultivate a community of alumni and mentors to help graduate students get a good start. London-based Prodigy Finance stresses the financial returns as well as the social benefits of encouraging diversity in business schools and economic growth in the students’ home countries. “Marketplace lending” is a more efficient name, which also includes new entrants such as Earnest, which uses data analysis to channel institutional funds to worthy candidates, charging much lower rates than either a bank loan or a federal loan.

(It’s worth pointing out that marketplace lending is a very small part of private student debt financing. And private student debt financing, which can offer variable interest rates and no limit, is a very small part of overall student debt. Marketplace lending offers much lower rates than traditional private student debt. Federal loans still account for about 70% of student debt. They usually carry a fixed interest rate, defer repayment until after graduation, and offer a cap on repayments according to income as well as the possibility of capital forgiveness if income remains low. Most students end up relying on both federal and private loans, since federal funding is limited per individual, generally to amounts well below the soaring cost of tuition.)

The marketplace lending platforms are mainly limited to helping out with graduate school debt, specifically MBAs, law school or similar. And that makes sense, because MBA graduates, lawyers and technical PhDs tend to earn a very good salary. But, what if you want a graduate degree in German political history? Or, what about undergraduate degrees?

image by Jeff Sheldon for Unsplash

image by Jeff Sheldon for Unsplash

Obviously, lending to undergraduate degrees is not nearly as profitable. So marketplace platforms, which exist to give a good return to their investors, are understandably going to focus on the profitable end of the spectrum, leaving undergraduate studies increasingly to the federal loan system.

And yet, obviously the federal government needs to do something to reign in the ballooning potential deficit. Over 7 million loans are currently in default, and it is likely that that number will increase. Especially by those who have dropped out of university, or who have chosen low-paying liberal arts degrees.

The federal government is still the largest funder of undergraduate bachelor degrees. But, as competition for graduate debt increases, it is likely that the private marketplace platforms will start to move into undergraduate territory. Of course, they are unlikely to fund just any undergraduate degrees. They are likely to focus on the “profitable” ones.

It’s a question of economics: a reasonable starting salary for an electrical engineer is about $57,000, while someone with a “humanities and liberal arts degree” can expect to earn $39,000. At that level, it increasingly hard to service the debt, which can reach an average of $35,000 per undergraduate borrower.

In June of this year, writer Lee Siegel published an article in the New York Times in which he explained why he defaulted on his student debt:

“Years later, I found myself confronted with a choice that too many people have had to and will have to face. I could give up what had become my vocation (in my case, being a writer) and take a job that I didn’t want in order to repay the huge debt I had accumulated in college and graduate school. Or I could take what I had been led to believe was both the morally and legally reprehensible step of defaulting on my student loans, which was the only way I could survive without wasting my life in a job that had nothing to do with my particular usefulness to society.

…It struck me as absurd that one could amass crippling debt as a result, not of drug addiction or reckless borrowing and spending, but of going to college. Having opened a new life to me beyond my modest origins, the education system was now going to call in its chits and prevent me from pursuing that new life, simply because I had the misfortune of coming from modest origins.”

And that’s why I’ve been thinking about the value of a liberal arts degree recently, and worrying that it is being crowded out in favour of more technical, profitable options. I worry, because not only would the world be less interesting and more difficult to understand, but also because I strongly believe that the liberal arts are due for a strong resurgence.

A liberal arts education may not teach directly applicable skills, but it instils the ability to think, analyse, question and connect. These are all qualities that, contrary to common belief, are more necessary and useful than ever. Writing poetry hones the control of words. Art creates an aesthetic of thought which goes beyond the obvious. Essay-writing teaches the power of conviction and eloquence. Deep reading, debating, communicating and exploring create abilities that more technical fields understandably tend to overlook. In a world with a surfeit of information, the ability to collate and understand is essential. In a world of algorithms and filters, the ability to dispute and to see the bigger picture is necessary.

And looking to the future, in a world of increasing automation, engineering will become easier as computers do more and more of the work. Accounting will become more efficient. Programming will move along faster, using previously-created blocks and auto-generating code. Software will help architecture, construction and technical design be more responsive and intuitive. Even the medical profession will benefit from better data, better robotics and better diagnostics. Many technical jobs will eventually be replaced or perhaps reduced. Thinking jobs won’t.

The current financing system is leading to the commoditization of education. Ironically for someone with a technical degree (Applied Mathematics and Economics), I find that sad. We need money to live on, so we need to earn a reasonable income, that much is obvious. We also cannot expect to borrow money and not pay it back. But the current system is hurting our present and our future. Something needs to change. Maybe it’s the introduction of non-interest-bearing student loans. Maybe it’s a focus on reducing the cost of education. Maybe it’s the encouragement of private altruistic funding from alumni in exchange for tax breaks and public recognition. Maybe it’s a combination of these and other better-thought-out, possibly initially expensive but ultimately profitable initiatives.

We all can agree that education is the key to intellectual and economic development. And I’m sure that we can also agree that one of the many wonderful things about our society is the rich diversity of interests, talents and experience that the young bring to the playing field of life. Do we want them to feel obligated to choose “profitable” careers when they strongly feel drawn down a different path? Do we really want to create the kind of society that chooses their future for them? Generalizations aside, there is nothing wrong with making lots of money. But wealth shouldn’t be the only factor that influences choices that important.