Archive for June, 2012

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Where, exactly, does the U.S. government get the power to require that every one of its citizens must participate in a government‐sponsored health care plan? Ask this of a health care reformer and he, or she, will sniff, think a moment, and (if legally trained) will immediately utter the two most magic words in late 20th century constitutional jurisprudence—Commerce Clause.

If the legality of a health care package featuring federally mandated universal participation is litigated (and we can bet it will be), and the system is upheld, it will mark the final extension of this originally modest grant of federal authority. Thereafter, Congress will be able to regulate you not because of who you are, what you do for a living, or whether you use the interstate highways, but merely because you exist…

David Rivkin Discussing the Individual Mandate from September 29, 1993

This was originally discussed in 1993, the last time the individual mandate was made popular…by Republicans.

For economists, the puzzle is not why voting participation rates are so low in voluntary systems, but why they’re so high. The so‐called paradox of voting, highlighted in a 1957 book by the political scientist Anthony Downs, occurs because the probability that any individual voter can alter the outcome of an election is effectively zero. So if voting imposes any cost, in terms of time or hassle, a perfectly rational person would conclude it’s not worth doing. The problem is that if each person were to reach such a rational conclusion no one would vote, and the system would collapse.

Mandatory voting solves that collective action problem by requiring people to vote and punishing nonvoters with a fine.

Peter Orszag

Not an advocate of compulsory voting myself, I am willing to make note of the implications in the above quote and conclude that if our goal is simply to improve voter turnout, then it is the only way to do so effectively.

Education as a Signal of Employability

It is becoming apparent that people are beginning to value, and are subsequently willing to pay for, ‘incremental increases in quality.’ Not because of an increase in signalling value, but because of the perception that the decreasing rigor required to obtain a degree has flooded the market with fewer qualified individuals.1 In this instance, though, isn’t the signaling value still one of the primary motivating factors? You’re still after a degree from an institution that signals you’ve received a higher quality education.

What is apparent to me as an unimportant plebe is that employers do not have a reliable way to determine the value of an interested prospect, so they immediately rely on what they deem a dead simple way to evaluate people: degree ? interview : worthless.2 As more and more people became aware of this requirement, we saw an increasing demand for degrees from institutions that were unable to provide them.

Perhaps the desire to grant these degrees has decreased the instructional quality at universities in some circumstances? There are simply more students than resources to go around, thus a degree’s worth has plummeted.

I contend, however, that a degree in and of itself, right out of school, is valueless as anything other than a check mark on a candidate check list, whether you are qualified, skillful, or particularly intelligent or not. Employers simply do not care. They have no method of determining your value and have passed the buck on that task. They are simply unwilling to invest in their resources in this day and age. Additionally, you may be more experienced and qualified than another candidate, but have no graduate degree, and be passed over simply because of the misguided perception that something like a degree implies quality.

This is not a universal quibble I have; simply, it is one I have with the business world. From a purely anecdotal perspective, you can work in a position, perhaps by filling in for a recently departed employee, be quite good at it, and still be passed over for a candidate with a degree, simply to be put in a position to train that individual and continue to do their job for six months. Because they have a degree, that must mean they’re more qualified for a job you are performing competently.

A travesty it is. A travesty that has only driven up the costs of obtaining an education and employment.

  1. Postrel, Steve. Reproduced at Marginal Revolution. Accessed 6/21/2012.
  2. If then statement. If they have a degree, then they’re OK to interview, if not, toss them in the trash.