Yet again, Rhode Island has been saddled with a bottom-10 ranking: This time for its heavy-handed occupational licensing regulatory regime, which effectively denies many people the right to earn a living. In Washington, the Trump administration is returning to a “light-touch” regulatory strategy, a strategy that our state would be wise to follow. The goal of an effective regulatory strategy should be to ensure that occupational licensing is no more burdensome than needed to address present, significant and substantiated harm. Under this light-touch approach, businesses are freer to develop and produce jobs.
Bad actors will either be naturally forced out of the free market, or can be fined, censured, and criminally prosecuted under the existing and lighter regulatory framework. Only when, and if, systematic and documented abuses occur should appropriate regulations be considered. In recent decades, our state’s policymakers, have followed a “crystal ball” approach in occupational licensing and other business regulations. They try to imagine what wrongs might happen in the future, and then attempt to preemptively regulate them. Such a heavy-handed approach tends to limit investment and stifle innovation for everyone in the targeted industry.
Not only must this anti-jobs approach be ended, but existing frivolous occupational regulations must be immediately rolled back. Consider the emerging shared- and gig economies, which will become vitally important to a thriving and prosperous future work force, especially for millennials. Ocean State bureaucrats and lawmakers have already resorted to overregulation. Did you know that a $6 fee was recently imposed on all ride-sharing pickups at T.F. Green Airport? Or that renting out your home while you’re away is now a taxable event? We even require costly licensing for sign language interpreters and non-instructional teacher assistants. Further, there was a legislative push to make it a punishable offense to offer less costly and more convenient Internet-based refills for contact lenses. Indeed, it is foolish.
Money-grabbing public officials who seek to tax everything that moves, along with protectionist trade organizations that seek to prevent competition, are the driving forces behind our state’s onerous licensing requirements. Our Center will publish a related policy brief this December and will work in 2018 to follow Washington’s lead to unravel and reform our state’s burdensome and unfair regulatory regime. If we are to become a top-10 and truly prosperous state, every reasonable freedom must be afforded to every family to provide them with every opportunity to earn an honest and gainful living.