Assorted Links

• Obama to Propose More Oil Drilling in Gulf (Purely political move, but I don't care about the ulterior motives! DRILL!)

• Holman Jenkins Jr: China Convicts Itself

• Taxes per Person (Simple Math)

• Gary Becker on the Health Care Bill

• Georgia and Price Gouging

Another great video I watched today:

On a side note about the engineering field

Boy did we get screwed! By we I mean civil engineering majors (civies). When we decided to major in civil engineering the economy was rolling full steam ahead in the housing boom; buildings were being constructed. The government was gearing up to put more money towards infrastructure. I remember telling my father, "We are going to need new infrastructure! Engineers are always in demand!"

Holy s**t was I wrong! Civies are not in demand like they used to be! I did not realize at the time that there would be a huge drop in private construction and those who could not find private contracts would flood the public infrastructure market. So much so one recruiter told me that "you now have 20 companies bidding for one [public contract] where you would only have 5." Which of course means lower prices, and lower profit margins for the firms. Which of course leads to belt tightening; which means either layoffs or no hiring. Damn!

As I write this though I must admit as depressing as the job market is for civies my friends and I seem to be taking it in stride. We laugh about our naiviety of thinking we were always going to be guaranteed (pronounced gar-run-teed if you have had a Spence class) a job after graduation, and some of us are even going to graduate school. I guess that goes back to the good ol' fashioned American optimism!

Why Do Women Leave?

In the Freakonomics blog yesterday was a post about a paper by Jennifer Hunt about why women are leaving the science and engineering fields. Her conclusion is that women have either family issues or are dissatisfied with promotional opportunities. I am not going to disagree with her point since I am neither in the field or a woman, but I am a civil engineer and I would like to point out something that I have noticed at an engineering school.

There are not that many women in the field to begin with. In Reinforced Concrete Design there were about 5 women in a class of 80, and in Senior Design (The Lake Champlain Bridge one) there is 6 women to about 70 students. I do not want to speculate as to why there are not as many women in the engineering field, and I will admit that my observations might be skewed because of my major. However this is has been an issue for a long time; people for years have been complaining that my school, "Has no chicks!" Since the inception of the business school in the early 90s the school has reversed that trend, and people keep telling me that the incoming freshman class is 50/50. I am skeptical though that we are obtaining more female engineers which is unfortunate.

Assorted links of what I am reading this morning

• Mary O'Grady: The U.S. versus Honduran Democracy

• Seeds of Antitrust Destruction

• Trying to Tame the Unknowable

• A Fiscal Trainwreck

• Bret Stephens: Lady Gaga versus Middle East Peace (personal favorite)

• William McGurn: The Tax Police and the Health Care Mandate

• The Rich Can't Pay for ObamaCare

• The Ballad of Sallie Mae
  

Assorted links of what I am reading this morning

• The Canadian Banking Fallacy

• China, the US, and the renminbi: a rejoinder to Krugman

• Don't Call it "Stimulus"

• Less now, more later

• This quote made me laugh:

  "Short of shooting up a Post Office, government workers rarely get fired or laid off."

• I do not generally read the Weekend Interviews of the WSJ, but today I made an exception for Gary Becker the 1992 Nobel Laureate in Economics
  (Thanks to this article I now know he has a blog...AWESOME)

• The Long-Term Unemployed: Consequences and Possible Cures (Gary Becker on his blog)

• Why Women Don't Want Macho Men

• Who needs a space shuttle
  

Student-Loan Shenanigans

Besides the fact that almost anything with the word "shenanigans" in the title is a good, the editorial "Student-Loan Shenanigans" addresses the curious part of the Health Care Reform bill that changes the rules on student loans. I am going to repeat that with some emphasis on the ideas I find important; the editorial "Student-Loan Shenanigans" addresses the curious part of the Heath Care Reform bill that changes the rules on student loans. Not only does it change the rules, but it seems to skew the playing field in favor of ALL Student Loans a company from California. Who sponsored this idea? Representative George Miller from the state of...wait for it...California. It is funny how that happens?

However the bigger issue I want to address is the mistaken notion that making student loans more available makes college cheaper or more affordable to people. Let us examine it from two perspectives, one of relatively poor student named Joe Bushy and the other of the college Mr. Bushy is going to attend Generic University. Joe Bushy is able to attend college because of the availability of Federally sponsored loans. Joe thinks this is a wonderful thing; if it was not for this program he would not have such a great opportunity to attend Generic U. Well Jane Doe thinks it is awesome too; she got the same sort of Federal sponsored loans to go to Generic University. Repeating this scenario over and over again one ends up with thousands of people who can now afford to go Generic University. Many people find this to be a wonderful out come; more people can now get a degree in something and increase their earning power.

Conversely let us now sit in the seat of a college administrator at Generic University. As an administrator you now see an increase of applications and qualified applicants to the school. The school can not take them all due to the simple limits of dorms, class sizes, faculty, etc. With such a limited supply and an increase in demand it would is in the best interest of the University to do one thing. The laws of supply and demand would dictate that the University should increase the tuition payments in the short term. It takes a long time to build dorms, expand faculty, and all other things associated with increasing the quantity supplied of a college. Until it can create the ability to satisfy the new demand in the market the University will raise the cost of attending it.

These ideas are theoretical or "arm chair"....I mean "half couch," but let me provide you a front line experience of what actually happens. I am currently a senior at a university, I will not reveal which, and the way it works in reality has a couple nuances. When I say it takes a long time to create larger supply I am assuming a perfectly working system. Universities and colleges work a tad bit more efficiently than there government counterparts. What I mean by that is what would take the government 20 years, takes colleges and universities 15. Whereas the true private sector something will take less than 2 years because competition is fierce. Government and education have sort of a captive audience. Anyways I digress; in my experience my university expanded the number of people in each class, but did not add any new facilities or allow for more liberal off campus housing options. Hense last year we were over crowded. So much so they changed the rules for off campus housing to make it easier to obtain it and added a floor onto the quad. Of course this was a problem every student sort of saw coming, but the monolith that is the university administration does not react quickly enough as usual.

Would the refusal to issue government sponsored loans solve this problem? Not entirely, but does it make school more affordable? In my experience and thought, no.

(HAD TO CUT THIS SHORT, FRIENDS WANT TO GO OUT, MORE EDITS TO COME LATER)

My morning readings of the WSJ

• Jobless Claims Decline (woohoo!)

• ObamaCare Day One

• Daniel Henninger: Repeal the Democrats (my favorite WSJ columnist)

• Max Boot: ObamaCare and American Power

• Karl Rove: What Republicans Should Do Now

I am also reading "Student-Loan Shenanigans" but I am not including it in this list because I am going to blog about it later.

What I am reading this afternoon

• JP Morgan Chase takes advantage of stimulus bill and seeks refund of roughly $1.4 billion

• 10 most redundant (I would say annoying) things on a movie poster
  

• Tim Tebow trying to get everyone to say a prayer before the Wonderlic Test and people respectfully declining

• Australian politician Greg Donnelly on Lady Gaga (fun stuff right here):

  "Young boys may start to think that women and young girls are fair game and that they can go to a party on the weekend, get loaded up with grog and that it's their right to ask a young girl for a h*** job or for anal sex or to push a young woman up against a wall and have sex...Some members are grimacing, but that is the reality. This material agitates a mindset in young boys, who grow into men, that women are fair game and that such behavior really doesn't matter; that they can get loaded up with grog or drugs and everything is okay."

Quick read before Construction Materials

Cruising the WSJ I found this. Initial reaction was, "Why the hell would you trust anything proposed by Senator Dodd AND Representative Barney Frank?" Has anyone forgot these are the same guys who said Fannie Mae and Freddie Mac are fine? They claimed this to the end, and even after the United States nationalized them they claimed they were wonderful! Are they missing the idea that Freddie and Fannie caused the whole mortgage bust? Okay I might be exaggerating, Fannie and Freddie did not cause the crisis they just oiled the gears.

Furthermore where is the transparency in this whole process? It seems Sen. Dodd and Rep. Frank have been working on this behind the scenes while America has been up in arms about ObamaCare. Great just what we need another back room decision on America's future. Hope this gets voted down, but I do not hold out much hope.

Reminds me of The Who, "Meet the new boss, same as the old boss."

Assorted links of what I am reading this morning

• Bryan Caplan's opening statement for George Mason's Econ Society's Health Care Debate (wish I could be there)

• Deborah Peel arguing that your medical records are not private if they are electronically recorded (duh!)

• NFL changes their overtime rules for the post season (meh)

• Gene Wojciechowski argues, "What's the point of buying a new car if you can't take it for a spin around the whole block? The NFL is keeping its car in the garage until the playoffs"

• Kim Kardashian is single again (link is in the picture)

Are Health Insurance Companies Now GSEs?

Reading Holeman Jenkins Jr's column on the new health care bill got me thinking about the question, are health insurance companies now government sponsored enterprises?

Certainly they are not like Fannie Mae, Freddie Mac, or Ginnie Mae yet, but what about five, ten, twenty years down the road? The motives behind the creation of Fannie, Freddie, and Ginnie are similar to the reason to motives behind the new health care law, fix a perceived market failure. In the mortgage GSEs it was a lack of liquidity in the mortgage market, and with the insurance market it was a lack of coverage of the poor and middle class.

Now the health insurance companies are not GSEs in the same sense as the mortgage GSEs, i.e. they losses health insurance may take are not backed by the government, but the individual mandate basically is the government saying, "You people need health insurance, and we support the health insurance industry. So we are requiring you to purchase health insurance." If that is not a sponsorship of the health insurance industry then I do not know what is!

However I cannot wait to feel vindicated when the health insurance industry finds out how its new buddy, the government, runs business. It is like seeing a guy/girl at the local club hitting on a woman/man who you know is just there to get drinks out of guys/just sleep with the girls (happens all the time!). It is almost brotherly/sisterly duty to go and tell the guy/girl, "Hey be careful of her/him." Of course the majority of Americans did that, but the insurance industry, probably drunk on the idea of an individual mandate, decided to sleep with the government anyways. I am chomping at the bit to here the first negotiating session between the government and health insurance about the cost of a procedure:

Health insurance: "This new procedure took years of research and to recoup our cost it is going to cost x."

Gov't: "No, that is too expensive we are not paying for that procedure unless you lower the price to x-y."

Health insurance: "At that price we will not recoup our cost! We cannot do that!"

Gov't: "Well if you cannot do that price then we will not allow this new procedure on the government health insurance, and we are going to have you testify before Congress as to why you would hold back such procedure because we think you are price gouging."

Am I the only one who sees such a scenario playing out?

Michael F. Cannon discusses health care reform in a NMA forum

Now this is over a year and a half old, but extremely poignant given what just happen in health care. Michael Cannon, an economist from George Mason University, bets Karen Davenport, a master of public administration that he can convince her of these two claims regarding universal health insurance coverage:

1. Supporting an individual mandate is an act of personal irresponsibility
2. Supporting universal coverage means you are willing to let people die unnecessarily

It is obvious he won, but I feel it is a trick question. Especially on the first point where Mr. Cannon states that it is irresponsible to give up any bit of freedom. So by agreeing that the government should force people have health insurance is personally irresponsible because it denies people the freedom to choose whether or not to have health insurance. I agree with Mr. Cannon on the principle, but I feel those who support the individual mandate believe that the benefit of having everyone possess some sort of insurance is more valuable than the restraint on freedom it imposes. I find this to be a sort of principled argument that no one really considers when debating policy, but it makes for an interesting economic thought game when one is bored.

The second point is a little bit different than I expected. I did not expect Mr. Cannon to use the erroneous "death panel" argument that the Republican party used unsuccessfully, but he did not even touch upon the concept of price at all. Instead he argued that academics have proven that the concept of health insurance may not be the best alternative to staying healthy, and that by expanding this concept to everyone is essentially expanding a theory that has not be tested against other possible maybe even better solutions. The other solutions possibly might save more lives.

Regardless of what he argues, he is right and it goes back to the basic concept of economics: there are infinite wants and finite resources. This is especially true when it comes to the concept of information. Everybody wants to know everything, but there are limits. Without perfect information there are going to be unnecessary deaths, but obtaining anything close to perfect information is more expensive than we can imagine, and as I would argue impossible.

Both the claims Mr. Cannon makes are true, and Ms. Davenport owes him $40.

What do you think?

HT: Bryan Caplan for posting it on his blog

The Name and Motive

This blog is a spawn of my two passions: reading articles and essays when I should be studying and sharing those articles and my thoughts with the rest of the world. Before this blog was created I was happily and enthusiastically posting all the articles I read or had an opinion on my Facebook. However I started to realize that maybe Facebook was not the best medium to communicate these ideas. Facebook gives you an area to comment on what you are sharing but I always felt this area was formatted more like a Twitter account then a blog so I would try to limit myself to three or four sentences.

For those that know me, three to four sentences is not my style. If I am going to take the three minutes to read an article I fully expect to be able to have at a minimum a ten minute conversation or three paragraph essay stating my opinion of the article. So in an effort to get my fix of procrastinating and opinion sharing I created this blog which will serve as a substitute to my Facebook article sharing and notes.

Now the name of the blog was my first challenge, and I safely came to the conclusion that Half Couch Observations was fitting. This name stems from a story and a term. First the story, once not too long ago my family had an extra couch, and I wanted to move it to the attic where I had a sort of "man cave" if you will. Well the couch would not fit up the stairs so I looked at my friend Andrew who was helping me and said, "We are going to saw the f*****g couch in half!" The next day we sawed the couch in half and took it upstairs. Now the second part of the name comes from the term, "armchair economist." An armchair economist is an economist who sits back in an armchair and just thinks about situations; basically one who does not do much "get your hands dirty" research. What better to describe what I do, sit in a chair, read articles, think about them, and comment. I am not an economist though and I do not have an armchair so this name was not fitting. I do have a half couch though and I generally enjoy using the term observe. Additionally the chances of "Half Couch Observations" being used on this blogging site were slim.

So it fit perfectly, and is now my main method of communicating what I am reading and thinking to the world. Hope the readers learn something and enjoy what I plan to be a regularly updating blog.