Harry Harrison Brainstorms a Fix for the Student Debt Crisis
These days, Harry Harrison is focusing squarely on the next chapter of his life. When he was the head of Barclays Non-Core, he was understandably consumed with his business. These days, he has more time to focus in on other parts of life. He’s been able to spend more moments with his family, accompanying his wife to work events and fine-tuning his yoga skills. And, luckily for those who ponder this problem, he’s been spending a lot of his free time devising a way to get students out of debt.
As everyone knows, this is a crushing problem that many people across the planet are facing. While most decent jobs require college degrees, it’s not cheap to go to school these days. As a result, many students find themselves taking out big loans to fund their educations. Over the years, the interest from these nearby payday loan companies pile up — and because the recently graduated student isn’t often working in a high-paying position, the interest can indeed rack up very quickly.
Unlike many of the financial experts out there, Harry Harrison believes that there’s been too much talking when it comes to solving the student debt crisis—and he’s all about action. The way Harrison sees it, Income Share Agreements, often referred to as ISAs, might provide the foundation for a much better system than what we have now. These financial products, which behave more like equities, allow investors to profit in a student’s future earnings. With underwriting that hones in on a student’s future earning potential, suddenly the entire system begins to open up in a way that no one has imagined yet. As Harry Harrison believes, these ISAs could be used in conjunction with W2s in order to ensure that backers receive a return on their investments.
With a system that worked off of ISAs, students could receive stipends and other support while they are learning their respective trades. Harry Harrison also notes that this would encourage students to pursue careers that will be more financially rewarding, causing a chain effect that could even make the economy better in the long run. However, this proposal wouldn’t entail just a money-making venture in its entirety. Although financial institutions will be involved, in Harrison’s view, it would be best if they could be paired with philanthropic organizations that will help students who want to explore more esoteric educations.
Harry Harrison has repeatedly stated that the system we have right now is failing. It’s time for a better way of doing things, and ISAs just may be the answer to what has been a historically difficult problem. Once we get some of America’s greatest minds working on this issue, it will morph from a problem into a challenge that we are tackling. Those who are interested in the ISA solution could certainly take it for a test run, implementing trial markets to see how it works in the real world. For those who are tired of hearing about this international concern, it’s time to get to work.