Is a College Degree Worth It?

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Once upon a time, only a few percent of Americans had a college degree. After World War II, soldiers returned and used the G.I. Bill to go to college, then they got married, had kids, and sent their kids to college. Pretty soon nearly 25 percent of the country had a bachelor’s degree.

Well, why can’t everybody have one? Indeed, the push is on to provide all Americans with the benefits of higher education, and governments pour money into it. Of course, this causes colleges and universities to get more expensive — we’ve been adding money to higher ed much faster than we’ve been building lecture halls and dorms. What’s worse, the more college degrees there are, the less they’re worth.

I mean, what were we thinking? If everyone is college-educated, suddenly there’ll be middle-management jobs for us all? But who will be the janitors? The maintenance people, the security guards, the baristas? People with bachelor’s degrees, that’s who.

Businesses use a college diploma as a way to filter job applicants. When everybody has one, though, the winners in the employment derby will need … advanced degrees! And so it is, in many industries these days. In business, an MBA helps a lot. To be a nurse, you usually need a Master’s degree. The competition is heating up.

Yet the push for universal higher education continues. There must be another reason. Originally, going to college was supposed to be an eye opening, mind expanding experience that would improve us as human beings. No one but college recruiters takes that idea seriously anymore. Instead it’s all about the money.

…Or maybe it’s about status. A bachelor’s degree has traditionally signaled that you’re intellectually superior to someone with a mere high school diploma. Clearly that won’t work if everyone finishes college; it’ll be like it is today, when nearly everybody gets through high school. And, like I said, we end up with janitors who have college degrees. So maybe, just maybe … the political push to give everyone a degree isn’t so much about advancing the opportunities for the poor and minorities as it is about draining the college degree of its prestige.

When a college sheepskin becomes no more distinctive than a high school diploma, people with bachelor’s will no longer be able to lord it over anyone else.

If that’s the real goal — to dilute the value of college — then those of you wondering if you should finish your higher education for its monetary rewards might want to re-think your options. Today’s four-year degree has gotten so expensive, it takes years, and sometimes decades, to pay it off. That once was true only for CPAs and attorneys, but now it’s becoming the norm for everyone who enters the ivy-covered halls of academe. On top of that, student loan defaults are going up, in part because a college degree no longer leads to incomes high enough to defray the loans.

Assuming you want money and don’t want to end up behind the financial eight-ball, there are several other approaches. If you’re good at sales, they will care where you went to school, and the money can be stupendous. If you have a knack for business, starting one can reap big rewards. (Silicon Valley, for example, loves it if your resumé includes a start-up that you sold for a profit.) Or what about the trades? Electricians, plumbers, and carpenters make very decent wages: median pay approaches $50K per year plus bennies, while the best can charge more than $100 an hour for high-end work.

There’s a joke about a man who marries off his daughter, and at the reception he greets an old college buddy: “Great to see you again! Let me introduce you to the rest of my kids. This is Richard — he’s an MBA. And this is Paul, an attorney downtown. And Bill, he’s a doctor. And this is Bob. He’s a plumber.” … “A plumber?” … “Well sure,” says the dad, “Somebody’s gotta pay for all that education!”

For my money, though, I’d go into electrical work — it’s a lot less messy.



Can Everyone Be Rich?

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“The reward would be…”


“Well, more wealth than you can imagine.”

“I don’t know — I can imagine quite a bit.” 

—Star Wars: Episode IV – A New Hope


Let’s say you’ve done very well and you have a six-figure income and, say, four million bucks in the bank. And you start to feel guilty: Should I really have this much money when so many people are struggling to feed themselves?

You could give it all away. Let’s assume there are four billion poor people on the planet, so divide that into your four million dollars, and each of them receives … excuse me while I whip out my calculator … [*click-click-click*] … one tenth of a penny per person.

Well, that’s not gonna help.

Wait, I know! What if, somehow, everyone could be rich? Could everyone have four million dollars?

Let’s find out. Take America as an example. In 2015, the total assets of U.S. citizens (real estate, stocks and bonds, cars, smartphones, PlayStation consoles) minus debt (mortgages, credit card balances, and the amount you still owe your bookie) was about $85 trillion dollars. Divide that by the 2015 U.S. population and you get a bit more than $265,000 per person.

So if you divvy it all up, every adult and child in America would be worth about a quarter mil. Not bad, but certainly not four million dollars apiece. So that won’t work.

Oh, wait, I got it! Maybe “rich” can be redefined so that more people fit the definition. Maybe $265,000 is rich by anyone’s standards.

Well, first off, you can’t live on it forever. It’ll run out after several years, even if you invest it. You’d need a cool million earning 8 percent just to have an income, after taxes and inflation, of around $30,000 per year. (Give or take. Your mileage may vary.) And thirty grand doesn’t get you anything fancy these days. But at least one person could survive on it indefinitely.

So every American would need at least four times as much money as is available today to be able to retire.

Of course, if everyone suddenly retired at this point in history, all the factories and gas stations and restaurants and bars would close, and nothing would be produced. We’d starve. Dang.

Okay, let’s start over. What, exactly, is “rich”? defines it as: “having wealth or great possessions; abundantly supplied with resources, means, or funds . . . ” “Great possessions” and “abundantly supplied”: these suggest much more than is owned by the typical schmo. But if everyone got the same amount — say, one million dollars — that would become the new “average”, not “rich”. Hmm.

On the other hand, four million dollars? Now, that’s getting somewhere. Thus if you’re worth millions, you’re still not off the guilt hook. But I have one more idea that might help.

It involves purchasing power. The average American — and the average European, Japanese, South Korean, Taiwanese, Chilean, etc etc — has more wealth than nearly every other human who has ever walked the Earth. Compared to those others, today’s middle-class groups are fabulously rich, abundantly wealthy with great possessions.

A citizen in today’s industrialized countries can own things never dreamt of by the kings of yore. What seem normal to us — quick cheap flights to weekend vacation spots, streaming movies on high-def stereo TVs, instant chats with people in other countries — would have been impossible a century ago. Our average income thus has enormous purchasing power compared with the past. 

That purchasing power keeps growing, year after year, as technology improves. In the future, a mere $30,000 below-average income could have several times its current purchasing power. In effect, a future $30,000 would afford what a six-figure income buys today.

Eventually each of us will have so many resources available from our lil’ ol’ average incomes that we’ll find ourselves possessed of the luxury and leisure and ease that the wealthy have always enjoyed. Like the idle rich of old, we won’t even have to work anymore — not if we don’t want to. The machines we’re building today will do that work for us tomorrow.

So if you’re still feeling guilty about having more than others, you can do two things: (1) invest your wealth in businesses that hire workers to produce the wealthy future that’s looming just over the horizon; and (2) dedicate your own work efforts to building that future, one in which everyone will have more than they know what to do with, to the point where money will no longer be an issue — a future where people will be judged more on their creativity than their bank accounts.

If, on the other hand, you’re wishing you had enough money to feel guilty about, please note that nowadays the quickest way to obtain filthy lucre is much the same: work to build a wealthy future for everyone.


Retail or E-tail?

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As of this writing, the boom times that followed the Great Recession are still in full swing, with unemployment below 5 percent. Yet we see shuttered stores on Main Street. It’s as if our town never got the news. What gives?

E-commerce has transformed shopping habits, shifting attention from street-side retail and toward website e-tail. You can order nearly anything online — food, clothing, books and music, appliances and equipment — and have it delivered to your doorstep, no store visits needed, often for less than you’d pay at the mall. As a result, businesses have cut back on brick-and-mortar locations while Web retail surges.

Still, while it’s easy to order a dress online from JCPenney or Macy’s, it’s gotten harder to try it on first, as chains cut back on the number of outlets. The chief reason to visit a street store is to touch the merchandise; website images don’t quite get it. But lately some customers will visit stores, try stuff on, then go home and order the items cheaper from another company’s website.

As retail square footage shrinks and bandwidth expands, the tension between mail-order and in-store shopping opens up a window for e-tailers who can give patrons a real-world sense of product lines from a home screen. Brick-and-mortar retailers, too, are looking for ways to shift their stance in the new ballgame.

Online businesses have been innovating:

• Many clothing websites will send you items to try on at home.

• You can customize your order by size, color, features, etc., and thus access the entire product line — much more than a brick-and-mortar outlet can stock.

• Many e-tailers provide multiple views of products, and you can zoom in on the images for a more detailed examination.

• Online prescription eyeglass stores let you upload a photo of your face (or you can select an image of a face that resembles yours), click on prospective frames, and view them on the facial image to get a sense of how they’ll look on you in real life.

If you’re an online store owner or web developer, be sure to keep an eye on the technology as it evolves:

• 3-D computer and TV screens will become common, allowing you to replace flat product images with more lifelike ones.

• Some Virtual Reality headsets already allow customers to “walk through” online stores and examine merchandise in much more detail.

• Haptic (touch-sense) gloves will augment V-R headsets so your patrons can “feel” cloth, “heft” items to gauge their weight, and “touch” product surfaces.

• And who knows? Perhaps someday we’ll have “Smell-o-Vision”, along with humidity and temperature simulators, so we can enjoy the often-pleasing atmospheres of retail locations.

These technologies are burgeoning almost faster than we can write about them, so stay up with developments.

Meanwhile, if you’re a committed brick-and-mortar retailer, don’t despair. Advancing tech creates new opportunities for you as well:

• Empty stores mean lower rental costs, which reduces the price advantage of your e-commerce competitors. A shuttered store next to you is a chance to expand your retail operations simply by renting the spare footage and opening up a passageway between.

• Your retail store can promote your e-tail store. Some chains (Bed, Bath & Beyond, for example) encourage patrons to use store computers to order out-of-stock or specialty items directly from the chain’s warehouse. This protects the sale while getting customers into the habit of ordering from the retailer’s own website.

• Driverless vehicles will ease traffic, so getting to your store will be less of a hassle. These cars will need fewer parking spaces, reducing congestion while opening up acreage that downtown business groups can repurpose into, for example, parklike pedestrian avenues for shoppers.

• People like to meet and interact with other people in person, and your store can become a social locale when you add, say, a coffee bar or entertainment corner, or you can host designers, authors, and artists who conduct seminars, demos, and readings.

• Visiting your store becomes something of an event with a Virtual Reality system that teaches patrons how it’ll look and feel to use your products.

The world is transforming in ways we can barely foresee. Retail sales, too, will shift unpredictably. Shop owners and online vendors who keep their fingers on the pulse of that change — and who resist the temptation to sit back and rest on their laurels — will find ways to thrive. It won’t be easy, but it will be interesting … and, if you play it right, it’ll be profitable.

* * * *

UPDATE: Retail scene changing quickly

UPDATE: Retail outlet as shipping center (and shipping center as retail outlet?)

UPDATE: New mall boasts 50/50 retail/entertainment

UPDATE: How retail stores can use AI

Robots and Riots

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You do not see union workers holding benefits for robots. — Stephen Colbert

There’s a Doomsday scenario where machines take over all jobs and everyone becomes unemployed. Evictions, hunger, and illness ensue. Riots in the streets. Calls for a guaranteed national income. Legislation to prevent robots from being built at all. Political calamities. A real mess.

French police unleashed tear gas and water cannons on demonstrators Tuesday as tens of thousands packed the streets of Paris in an outpouring of opposition to the government’s anti-labor agenda. news item

If workers will riot over incremental changes to employment, imagine how berserk they’ll go if all the jobs disappear.

“But robots will never take every job!” Oh, yes they will. We humans are clever — we’ve invented countless labor-saving gadgets over the centuries, devices stronger or faster or more precise than people can be. We’re also clever enough to invent mechanical brainpower that’s stronger, faster, and more precise than our own. In fact, we’re developing this Superior Artificial Intelligence as we speak. Such an intellect will eclipse our own poor powers and take charge. Soon.

(Which would you rather buy, something dirt cheap but excellent from a machine, or something flawed and unreliable and expensive from a human? Hmm.)

This could easily become a bad thing, since people thrown out of work generally don’t have money for food, rent, gasoline, and doctor visits. Also, most of us derive meaning from our labors, and without a job — a way to contribute — people might find themselves existentially adrift. Combine a lack of purpose with a lack of cash, and you get street riots and the other disasters.

And it also could be a good thing … if the automata serve us faithfully and make us all wealthy. We’d have endless free time to pursue our interests, with no need to convert hobbies into jobs. In that world to come, what matters would no longer be how rich you are, but how interesting you are. I call it The Star Trek Future.

(Yes, I’m well aware that this very blog could be replaced by automation. I’d have to find some other way to amuse myself. Tennis, anyone?)

A solution that lately has gotten traction is a guaranteed national income — a stipend for every adult citizen. If all people were unemployed, only those who owned investments would have regular income. The corporations would need to donate money to the unemployed, or none of them would buy any products.

The problem with this plays out as follows: I own a store, and you come in to get a candy bar but don’t have any money. I give you a dollar, and you hand it back to me for the candy bar. Essentially, I’m performing a short ceremony with you, at the end of which I give you a free candy bar. At this rate, I’ll go broke.

Another idea involves a kind of fiscal land reform: the government confiscates corporate stock and hands it out to everyone. We’d all become owners of the robots that took our jobs. Automated production would go to our bottom line, and everything turns out fine.

Except this would basically destroy the market economy. Nobody would invest in companies anymore, lest their hard-won gains be taken from them abruptly in some similar, future upheaval.

But what people aren’t talking about and what’s getting my attention, is a forthcoming rapid demonetization of the cost of living. — Peter Diamandis

What to do, then? It turns out there’s a solution that will likely unfold as a natural consequence of total automation of jobs. It’s called demonetization, and it will cause most prices to plummet. After all, robots don’t take vacations; they don’t need healthcare for their kids; they don’t go on strike; and they perform their tasks vastly more efficiently than can humans. They work much better and much cheaper.

Thus, though we may all one day find ourselves unemployed, our expenses could decline by as much as 90 percent. A meal at a fast-food restaurant would cost 50 cents, and a ride in a driverless taxi would set us back about 30 cents per mile, less than half the cost of car ownership. Dirt-cheap housing will be built using 3-D printing. Meanwhile, online education already is basically free, and the smartphone in your pocket comes with a slew of products and services that 30 years ago would have cost hundreds of thousands of dollars.

Given a small stipend from the government and/or a small stake in the big corporations, people would have more than enough cash to pay for basic necessities even if they were out of work.

It’s also important to bear in mind that non-human employment will likely emerge over time and not all at once. Economic downturns in recent decades have tended to resolve themselves with “jobless recoveries” as businesses bought new software first and then hired real people. This hints at workforce automation building momentum slowly over several decades.

Instead of being eliminated, your job might merely get cut back, bit by bit: they’d offer to keep you on at reduced hours that drop even further over the coming months and years. Of course, your pay would decline, but meanwhile your personal expenses will have plummeted due to all that cheap automation everywhere in the economy. So who cares? You just got a bunch of extra hours away from work while retaining essentially the same lifestyle.

(If you’re worried this optimistic scenario won’t play out according to plan, there are a number of ways to adapt your work life to reduce or delay your risk of being replaced by a machine.)

If business and government can coordinate properly (and that’s a BIG “if”), automation might supplant us gradually, so we retain a declining level of employment while prices also decline. We could actually achieve a soft landing into a life of prosperous leisure.

That’s not Doomsday. That’s more like Paradise.

* * * *

UPDATE: Will we control AI?

UPDATE: Jobs are already disappearing as robots take over

UPDATE: Automation begins to clean out white-collar jobs

UPDATE: The rise of the useless class

UPDATE: How to get paid in the Age of Layoffs

UPDATE: David Byrne on eliminating humans



Women Who Put Out Fires

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Recently there’s been chatter on how women often become leaders during crises. A number of examples come to mind: Carly Fiorina (Hewlett-Packard); Mary Barra (GM); Marissa Mayer (Google, Yahoo); Margaret Thatcher (UK Prime Minister) and Theresa May (UK Prime Minister). All these women attained high leadership positions during major upheavals in companies or countries.

Why do crises and women leaders go together? Two reasons stick out: (1) the men screwed things up and don’t want to touch the problem with a ten-foot pole; (2) groups cast about for a fresh perspective, saying, “Let’s see what a woman can do with this situation.”

Of course, sometimes men on the outside are simply waiting for the problem to overwhelm the woman so they can claim, “See? She can’t do it! But we can!” and winch themselves back into power.

Thus women candidates for leadership may want to think twice before gambling on a position that could turn out to be a sucker bet.

It brings to mind an old joke: “Why do ducks have webbed feet?” … “To stamp out forest fires.” … “And why do elephants have flat feet?” … “To stamp out flaming ducks.” You don’t want to become a pile of ignited feathers squished by an elephant of a crisis.

Two approaches to this dilemma are likely to be popular:

1. Complain that “men are no damn good” and they only use women in blazing emergencies and then toss them under the fire truck when the going gets smoky.

2. Learn how to put out fires.

Number 1, above, may be partly true and therefore useful to know. But complaining does not a leader make.

Number 2 is where the money is. A crisis is a woman’s chance to demonstrate calm capability. To that end, prepare for the opportunity:

• Learn how to handle budget emergencies

• Learn how to cut red tape

• Learn how to lay off employees, especially men who will try to intimidate you when you hand them a pink slip

• Learn how to cut spending, especially pet projects that are squirting money like severed arteries

• Learn how to meditate (or anything else that keeps you calm and unflappable)

With hard work, smarts, and a bit of luck, a woman can save the day, convert a trap into a triumph, and rise from patsy to hero. At that point, she should make sure her future compensation reflects her excellent performance — and/or be ready to field offers from other companies desperate for a turn-around artist.

So, ladies: prepare for the job as if it’ll be a series of emergencies … assemble your fire equipment … and go put out some fires.


How to Multitask

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The multitaskers perceived that they performed better, because their brains were more stimulated, but in every single study they performed worse. — Chris Bailey

When you are in a hurry, you are in danger. — airplane pilot’s adage

There’s an old Buddhist story where a businessman visits a Zen temple and says to the Master, “I need to become enlightened. How long will it take?” The old Roshi answers, “A minimum of one year.” The businessman says, “That’s way too long! I have a company to run.” The Roshi replies, “In that case, it’ll take five years.”

Many of us are busy and harried, and we cast about for productivity tools to help us get more done in less time. One of the most tempting techniques is multitasking, or doing several things at once. Pretty soon we’re driving while shaving and talking on the phone and texting and grabbing quick sips of coffee. It’s exciting! We’re getting things done.

Except we aren’t. Our brains are poorly suited to thinking about more than one topic at a time. It may feel as if we’re accomplishing more, but in fact we’re performing worse.

Yet we’ve seen people do multiple things simultaneously with apparent success. And, after all, we can walk and talk at the same time. Brush our teeth and listen to the news. Play the piano with both hands.

The piano: you read the music while managing keys simultaneously with both left and right hands. Heck, it’s like those super-geniuses who can write two separate sentences at the same time, one from each hand, on a whiteboard!

But it takes time to learn a new piece: you begin to memorize phrases and sections so they become automated as you study the next segments. Basically, you’re transforming each section into “brushing teeth”, where you don’t have to think about it anymore.

If you’re going to multitask, you must do it deliberately. Take the time now to automate small physical tasks — turning them into consistent routines until they’re memorized — so your brain is free to concentrate. The effort will pay off later. Remember: multitask rote physical stuff, not mental stuff.

Here are the main ideas:

  • Do one mental task at a time: Resist the temptation to do multiple mental jobs at once. (Examples: reading and talking, talking and texting, conferencing and texting, anything and texting.) Instead, calmly go through your list, one item at a time. No panic! You’ll get there.
  • Automate physical activities like making copies, brewing coffee, changing your tie, driving. (But be careful! Nearly any activity can require full attention on occasion — especially driving — so stop with all the texting!) Go watch a good bartender mix drinks automatically while chatting with patrons, and you’ll get a sense of it.
  • Slow down to speed up: If you hurry, you tend to perform poorly. (Remember that time in the parking lot when some bigwig was waiting for you to pull out of your space so they could use it, and they honked their horn, and you rushed and dropped your keys under the car, and hit your head as you got in, and dropped the keys again, this time between the seats? You get the idea.) Anything you rush gets worse, including multitasking.

So now you’re at work, and your boss yells, “Where’s that report, Jenkins?! And get down to Receiving and find those overnights! Also, Simmons got sick, so grab someone to fill in!” You take a deep, calming breath and say:

“It’s on my list.”


A Survey of Startups

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Nearly all startups fail to scale up.

There — we got the bad news out of the way. The good news: it’s possible to greatly shorten the odds by following a few simple rules.

A report on recent MIT research lays out some pointers:

“Compared to average startups, which have a one in 3,500 chance of experiencing growth, the top one percent of firms with these characteristics have a much better chance (one in 100) of taking off. New startups are four times more likely than the average startup to grow if they are a corporation, two and a half times more likely if they have a short name, and five times more likely if they have trademarks. Furthermore, firms that apply for patents are 35 times more likely to grow. And, curiously, eponymously named firms are a whopping 70 percent less likely to grow.”

There’s more, but in a nutshell:

  • Incorporate
  • Use a short name (not the founder’s name!)
  • Nail down your trademarks
  • Apply for patents
  • Locate in a high-tech region:
    • Silicon Valley
    • Southern California
    • Washington state
    • New York / Boston
    • Texas

Oh, and let’s add the standard principles for business success:

  • Provide a product or service people need and love
  • Make what you sell vastly better in some important way
  • Hire excellent people you can get along with
  • Stay focused on results (instead of signs of your own importance)
  • Work your butt off for 4 years or more

What could be simpler? Now get to it.