Recently a young writer/management consultant named Laura Newland penned an article for Dealbook shedding light on what she thinks is a pernicious troika of forces: student loans, pricy tuition at elite schools and of course, Wall Street. In the article, Newland argues that despite Wall Street’s apparent fall from favor among young people, its claws are still deep in the backs of students, especially at elite East Coast schools like Harvard, Penn, Columbia and Duke — where she graduated from just two years ago. She spoke with MyBankTracker this week, over the phone from Philadelphia, to elaborate on her experiences.
“I’m not sure how it happened, but suddenly I just had this idea that in order to be successful or to have a successful career I needed to work on Wall Street,” she said. She became aware of investment banking culture during her freshman year at Duke, from hanging out with upperclassmen who had spent summers interning at investment banks, or from seniors who had already accepted offers from Goldmans or whomever. These people were overwhelmingly the successful, popular types, she said.
“I think its very easy to see people who you admire following a certain path and think that if you follow that same path you will be successful, too,” she said.
Newland is shopping around a book called Chasing Zeroes: Elite Students and the Race to Become One of Wall Street’s Chosen, which she described to us as her “coming of age story,” that documents her four years at Duke. Starting as a naive freshman, the Alabama native tells the story of Wall Street’s slow creep into her life on campus, and how she was nearly swept up by the prospects of Wall Street wealth.
“In the end,” she wrote in Dealbook, “I landed a coveted offer, then turned it down because I had grown disillusioned by a toxic culture.” Instead, she went into management consulting, in order to pay off her student loans.
The cost of high costs
This, she argues, is why Wall Street still has pull, especially at elite private schools. Crushing student debts make a career in finance attractive to our best and brightest because they’re so saddled by outrageous student loan balances. And Wall Street does what they can to make students aware of its largesse, she said.
“They find a number of other reasons to come recruit us. So they’ll come and maybe host a panel, or they’ll host a resume writing workshop, or they’ll host a dinner and invite top recruits to a nice restaurant in the area.” She added: ”They definitely do everything they can to prove to you that if you work for them you will be treated royally, I witnessed that.”
But what exactly did she witness? Was she wined and dined by bank recruiters? No comment. She mentioned in Dealbook that “being popular, good-looking and able to drink hard seemed to matter more than being smart.” Could she elaborate? No comment. How many of her friends ended up in finance? No comment. Maybe a percentage? No comment. Was there a connection to the Greek scene? No comment. Cagey! I guess we’ll have to wait for the book.
Lack of details notwithstanding, Newland raises a good point: this relationship between these schools, this one industry, and skyrocketing cost of tuition can easily push students into careers they might not otherwise find alluring. It’s not just on the East Coast, either. The New Yorker recently published an interesting piece on Stanford University’s cozy relationship with Silicon Valley. While it’s typically considered a good thing for university research to feed into burgeoning industries, as is the case with Stanford, these relationships can tread into icky territory when they get too cozy. Especially in the case of Wall Street, where university research almost certainly has little to do with the relationship, the recruiting process is especially troubling — it looks more like poaching than anything else.
But of course any Wall Streeter would point out how financially rewarding a job at an investment bank can be — is this not the reason for Wall Street’s popularity among young graduates? And they need to recruit at top schools because they need top talent. Free marketers that they are — or claim to be — i-bankers would likely see no problem with this arrangement.
Who does Newland fault for this arrangement? ”I don’t fault anybody,” she said. “I don’t fault Duke. I don’t fault Wall Street…I don’t think we can place the blame on any particular institution.” With all sorts of actors and incentives involved, it would seem unfair to blame anyone in particular — Duke needs to help its grads find work, Wall Street needs to get new recruits who are not only smart, but also fit Wall Street’s “culture,” and students need to earn some money. The one pain point here seems to be the massive increase in student borrowing to pay for college, which Newland addresses in her piece on Dealbook:
In 2010, the average college student graduated with $25,000 in loans, the highest tally on record. Student loan debt now exceeds $1 trillion, according to the Consumer Financial Protection Bureau. No wonder our priorities are skewed.
So does Newland follow the debate over the Student Loan Forgiveness Act? And what does she think of it?
“Yes, I follow it, but I don’t want to comment on it.”