Inside Financial Services

Who Appointed Google Chief Nanny?

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I wonder what Google’s biggest shareholders think about the company’s decision to no longer accept advertisements for payday lenders and related services. First off, payday lenders’ ads appear to be an especially lucrative line for Google. “Keywords related to payday loans typically cost $4.91 to $12.77 per click, which is high,” the Times reports. What’s more, shareholders must be surprised to learn they own shares in a company run by people who now see themselves as armchair social engineers.  What’s next on the list of products and services that Google will refuse ads from, in order to discourage consumption? Strip clubs? High-fructose jellybeans? I wonder how much more revenue the company is willing to forgo so that its executives can keep feeling morally superior. “Don’t be evil,” indeed.

Google’s decision to ban payday loan ads is ludicrous. We already have a mechanism for deciding whether a given commercial activity ought to be engaged in. It’s called the government. And on the payday loan question in particular, state governments have considered the matter and have come to various judgments. Payday loans are legal in 32 states and illegal in the rest. And don’t forget, the payday loan business exists for a reason. People really do experience near-term cash crunches from time to time; taking out a payday loan (rather than, say, purposely bouncing a check or leaving an urgent bill unpaid) is often the most cost-effective way to address them.

Here’s my suggestion to the do-gooders out in Mountain View. Remember that people are grown-ups, and capable of making their own decisions. If a given good or service is perfectly legal, let the companies that provide it advertise on your site.

What do you think? Let me know!

7 Responses to “Who Appointed Google Chief Nanny?”

  1. Avatar etoleary

    The problem is much bigger than just your cited example, Tom. What about the CFPB making it so difficult for banking customers to arrange for overdraft protection or the Federal banking regulators’ overt efforts to discourage banks from banking otherwise legal businesses? In a broad way these are all efforts aimed at allocating capital for the end purpose of social engineering.

  2. Avatar Banker

    On point right there. I had the same reaction. I liken this to the political call to boycott Chick Fil A, which also makes zero sense. Why is it acceptable that politicians and CEO’s are making ancillary social choices for us based on their own beliefs?

  3. Avatar Charles Tharpe

    There seems to be a “on the other hand” moment here. While I think the whole NC HB2 controversy is trumped up (no pun intended) political one-up-manship, isn’t corporate America’s condemnation of the NC government’s action equally inappropriate. Freedom of speech and freedom of association is a basic right of every citizen. After all “corporations ARE people” or are they amoral profiteers that are prisoners of the bottom line.

  4. Avatar JohnACritic

    Well Tom, I guess you have never been in the position of needing a payday loan to live and knowing your being screwed with outrageous interest rates. Google is doing the right thing by not want to be a part of what is legal loan sharking. An increase in the minimum wage would help to do away with the need of a payday loan.

  5. Avatar jsc173

    You may have missed it but a few years ago Google blocked people from using their ‘Shopping” function to shop for firearms. No problem Googling for firearms, but Google won’t shop for you.

    Reminds me of Operation Choke Point, but Google thought of it long before federal banking regulators.

    As for the payday question, I’m sure there are those who see these loans as a ripoff of the poor and shouldn’t exist, so Google’s decision should be applauded. What they may not realize is that if payday loans were somehow made illegal folks would get their payday loan the old fashioned way and at a lot higher interest rate and the “old fashioned” collectors are a little more up-close-and-personal.

    Said differently, making payday loans illegal would be the equivalent of making drugs illegal. How’s that worked out?

  6. Avatar JRG

    Payday lending is predatory lending that takes advantage of the lower class. Sure 32 states allow this practice but 29 don’t and for good reason. The states that do are heavily influenced industry lobbyists. I have watched this in Ohio. The legislators that support the industry are the ones that receive the largest industry contributions. Google is standing up for the working class who don’t have paid lobbyists. Its the free market .If you don’t like their policy don’t use their service.

  7. Avatar cgm205

    Absolutely agree that Googl should look out for its shareholders but I have to
    think that they have the right to sell ads to whom they choose. Let the Board and shareholders make the ultimate decision.

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