Learning about dollars and sense

Re: “Toxic credit card debt’s distinctly Canadian recipe” (Opinion, July 11)

The piece by professor Amir Barnea of HEC Montréal is a perfect example of how the halls of academia can produce excellent ideas that are unlikely to be put in place.

Barnea calls for more competition in Canada’s banking sector. I agree completely. More competition is essential for us to have lower prices — in this case, in the form of lower credit card interest rates.

But where would this banking competition come from in Canada? We have few smaller banks, and most of these are regional in terms of operation. The competition would then have to come from foreign banking — something rejected by many economic nationalist interests in this country.

Barnea further recommends allowing banks to offer a menu of rates, based on applicants’ credit scores. This will inevitably lead to individuals with some specific characteristics paying higher rates — and likely be denounced as a form of discrimination.

I agree that education on the use of credit cards should start as early as high school. A career spent in financial services has shown me how bad financial illiteracy is in Canada. But I believe such education would be resisted with claims that schools are not meant to serve our society’s institutions and that it is not their duty to form “good little capitalists.”

Finally, Barnea states that the proper management of credit card debt is a matter of individual responsibility. Three cheers to that. But, sadly, our societies (not just in Canada) have changed to the point that calling for individuals to run their lives properly is almost considered a slur.

Paul Guillery, Montreal