Metroblog

A one-time school project gone terribly, terribly wrong.

18 January 2008

Big Bucks to $top Teen $moking

So Metro was perusing, in his way, the local rags for Canada, and he saw there this article entitled "Teens Offered Big Bucks Not to Smoke".

Basically, the deal is that kids are being offered $5,000 to stay smoke free until their high-school graduation. Kids in grades 5 to 8 make a pledge to stay in school and smoke-free until graduation. In return, they'll get a cheque.

From the first, this smelt funny. Knowing something of the success of, for example, virginity pledges, I wanted to investigate further.

I mean, it sounds good, and failing to smoke has significant benefits beyond the obvious: You'll reduce your chances of contracting cancer, you'll smell better, and you'll significantly reduce your odds of dying in a hotel fire.

But I just feel that something too good to be true ("free money"), is. And the article was a bit sparse on detail.

The organization behind this, called REWARDS (Rewarding Everyone Who Acts Responsibly and Doesn't Smoke) sounds fishy already. Uber-clever acronyms are often a sign that the acronym's meaningless. It bills itself as a "life-skills" training group.

Most of the real info is not actually available on the front page. Red flag number two. And much of the website content seemed evasive to me--perhaps because they had, as yet, not answered my major question:

According to the Globe and Mail article, students have to "recruit sponsors" to contribute "a small amount of cash". How small, exactly?

Reading into the site I discovered a few things:
  • The life skills outfit gets kids to pledge to stay in school and stay smoke-free
  • Compliance is monitored by blood tests, supposedly sensitive enough to detect tobacco use while discounting second-hand smoke inhalation
  • Kids can fall off the wagon and pay a $500 penalty, or earn back the penalty money by completing community service or writing an essay about the experience

  • Here's where it starts to get stinky: Kids must recruit four sponsors. Those sponsors must contribute $15 each per month for a student starting the program in grade 5. For a student in grade 8 it's $30.

    So I did some math:
    $15 x 4 sponsors x 84 months to graduation equals ...

    Anyone?

    $5,040. That's what it equals.

    For the later entrants, that becomes:
    $30 x 4 sponsors x 48 months equals?

    Well now, let's not always see the same hands.

    $5,760.

    So in return for four of your friends contributing over $5,000, the REWARDS organization will pay you $5,000. Oh, and they'll apparently send you motivational newsletters and suchlike throughout the program.



    The goal of the program's founder is 100,000 sucker--I mean, participants. Assuming that the average contributor is paying $22.50 per month for 5-and-a-half years (very crude maths here, the average money is likely higher, I think, while time would likely be shorter).

    That's 400,000 sponsors x $22.50 per month x 66 months. I had to redo the maths three times before I could believe it:

    $594,000,000

    Yep. Over 8 million bucks a month in contributions. For a payout of how much? $500,000,000. (5k per student x 100,000).

    Leaving the philanthropists of REWARDS with ... ? Put down your wing, young Mr. eAgLe, and drop those tentacles, Ms. Coaster ... Let someone else have a go.

    $94,000,000

    Pretty sweet for a five-and-a-hall year investment of bugger-all, I'd say.

    Of course, this model assumes that:
    a) Every enrolee completes the program successfully (see "Virginity pledges" again) and that everyone gets the full $5k.
    b) That there's no such thing as compound interest.

    I'm not going to get into the complex computations of interest on an increasing lump of cash. I mean, isn't ninety-four million enough? I'm not against anyone making a profit, particularly not in a good cause. But "investing" in your kids' futures in this way is far less productive than starting, for example, an RESP toward their college costs. And as a bonus, the more educateed people become, the less likely they are to smoke!

    Oh sure, there are probably operating costs coming out of that $94 mil. Secure databases don't maintain themselves for free. And someone has to produce this "motivational material".

    But as a writer of similar products permit me to tell you that I could produce reams of motivational material in print, internet, audio and video form for considerably, in fact pathetically, less than $8 mil per month.

    I wonder if they're hiring? And do they have an employee share plan?

    8 Comments:

    At 1:30 PM, Blogger Slave to the dogs said...

    What happens to the money when the kids will unquestionably lose interest in sticking with the program? It would only be fair for (at least a good portion of it) to be returned to the sponsors.

    Honestly, $40 for the administration of the program over 7 years sounds like a pittance to me. It sounds more legitimate than those programs where people raise dough for a charity and get to run a marathon in a faraway state free of cost. Not that being more legitimate than that is a shining endorsement.

    I should ask the spousal unit whether he thinks this would have worked. Many times I have asked him what I can do to help him quit smoking. The most common answer is "turn back time". He started when he was 13.

     
    At 7:55 PM, Anonymous Anonymous said...

    Hey Metro-Man;

    Welcome back. Did you know smokes are $12 a pack in a bar in Alberta? Good thing they don't have PST there, eh?

    That big bucks thing is a total scam. I think people who get lung cancer after smoking for 50 years deserve free medical care. They fuckin' paid for it in taxes, did they not?

    Kill 'em all!

    EK

     
    At 9:07 AM, Blogger Metro said...

    This comment has been removed by the author.

     
    At 9:08 AM, Blogger Metro said...

    @STTD:
    That's one of the questions I felt this post had gone on too long for. How many times can they sacrifice $500 and still collect?

    As I said, it seems someone's betting on this having the same success ratio as virginity pledges.

    $40 isn't much to administer $5000 for seven years. But on the other hand, it's $40 times many, many, right?

    If you privately invested that money at 4% interest, compounded annually, you'd wind up with $6000.

    Not to mention that while it may not be cheap like borscht to run a database, there's 94 million available for that purpose even without investing that money.

    A rough guess at the investment value of that 94 mil: $113+ million.

    As I said, I'm in favour of people making a profit in a good cause, but this is pretty bald-faced.

    In this case the doting parents would do better to a) invest the $5000 themselves in an RESP and b) actually try to parent the kids intensely enough to keep them in school and off the coffin nails. I'm certain the success rate would be as high, too.

    I tried smoking at 12, and resisted peer pressure through school (although since I was one of the "weird and wet" there wasn't that much of it). I started smoking a year after I joined the Forces, when I was an adult and theoretically knew better.

    @EK
    Harsh, dude. But you're right. In this country smokers pay enough tax to cover their own health care (another great reason to have the single-payer system).

    Does that mean you're still smoking 'baccy?

     
    At 9:09 AM, Blogger Metro said...

    Oh--and who the hell buys smokes in the bar anyway?

    I'll bet they're cheaper at the Safeway.

     
    At 11:02 AM, Anonymous Anonymous said...

    MM;

    I quit tobacco a while back. Listen to jazz instead. I Just noticed the price the other day when I deked into a beershack to drain the pickle.

    EK

     
    At 4:04 PM, Blogger Slave to the dogs said...

    You know, with the later entrants having to pay more, this also reeks of a Ponzi scheme.

    You expect parents to actually do some parenting? That's crazy talk! ;)

     
    At 7:51 AM, Anonymous Vicki said...

    I want to thank you for your article. I did sign up my daughter for the program as I saw it on the web and thought cool. I didn't read the fine print and that is pretty hard to find when you finally do. Once I did figure it out I thought well One I feel bad asking my family and friend to "sponsor" here to just basically give her their money. Also if it is me giving it, I might as well put it in a savings account and earn interest on it. It does smell very fishy!!!!

     

    Post a Comment

    << Home