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Racking Up Fees from the Working Class Through Licenses in Tennessee

Instapundit Glenn Reynolds is embarrassed to report this, from his home state of Tennessee:

“I never did any other job but hair braiding my whole life,” she said. “I cannot recall a time when I did not know how.”

But in recent years, Tennessee has forced Fatou to pay a staggering $16,000 in fines, simply because she employed workers who did not have a government license to braid hair. Nor is she alone. After examining meeting minutes and disciplinary actions for the Tennessee Board of Cosmetology and Barber Examiners, the Institute for Justice has identified nearly $100,000 in fines levied against dozens of braiders and more than 30 different natural hair shops and salons since 2009. All of those violations were for unlicensed braiding; none were triggered by any health or sanitation violation.

It’d be interesting to tally up all such fines in Rhode Island, not only for hair braiding but for every other egregious occupational license.


Can We Realize The Destruction Of Families Has Unintended Consequences?

In the Providence Journal this week, Wendy P. Warcholik and J. Scott Moody write, “This growing number of children in Rhode Island without a solid familial foundation should give us all pause. This is not a problem that is going to just go away, and we must find ways to help these children before tragedy strikes, perhaps in your own neighborhood.”


Let’s Avoid the Big Government Trap with Regulation

George Mason University Economics Professor Tyler Cowen sees occupational licensing as such a problem, he’s willing to modify his conservative leanings in order to suggest that the federal government step in on the issue:

Unfortunately, I don’t expect the federal bureaucracy to usher in the reign of Milton Friedman’s Chicago School economics. But the federal regulatory process would likely pay less heed to local special interests, and it would produce a more homogenized and less idiosyncratic body of regulatory law more geared toward the most important cases, such as medicine and child care. The federal government is less likely than many state and local governments to obsess over licensing rules for fortune tellers, florists and athletic trainers.

Cowen is falling into the progressive trap.  He recognizes that the “machinery for creating new licenses is much better organized and funded than the institutions for getting rid of them, and once in place these requirements have natural defenders, namely those who have invested in the credentials,” but he somehow imagines this advantage will simply disappear at the federal level.  Why wouldn’t these state-by-state organizations just start making alliances across state lines?

The assumption that a federal bureaucracy will be free of an inclination to the petty has little foundation in theory or experience.  Presumably, the agency will collect fees through regulation, and that will certainly be the source of its power.  Even just incentives toward job security will keep the numbers of licenses growing.

In cases of asymmetrical incentives, we’re always better off keeping decisions at the smallest scale possible.  The number of dog walkers in a particular town, for example, who want to create some kind of local license will more easily matched before the town council by people who think the license would be unnecessary protectionism.  At the federal level, the side with incentive to organize will have even more aggregated power, while the other side will be even more difficult to organize.

Frustrating as it can be, there is no end run to limited government that goes through big government.


Standing Against The Progressive-Left

At our Center, we know that the extreme levels of taxation and over-regulation forced on Rhode Islanders by an ever-growing government is the primary culprit in causing our state’s sad performance. Look at it this way— heavy handed action by a state government that mainly seeks to perpetuate itself, actually works against the best-interests of the very individuals it is supposed to be serving.


The Society-Wide Human Cost of Occupational Licensing

Apply this principle — from a Reason interview with a Boston hair stylist:

If people want to work in Zona’s salons, in virtually any capacity, they must first obtain a cosmetologist license from the Commonwealth of Massachusetts. That’s true even for positions that don’t have anything to do with cutting, coloring, or styling hair. Even shampooing or blow-drying hair, or being a stylist’s assistant—the types of entry-level jobs that allow someone to test out the profession before deciding whether to work in it—must be filled only by licensed professionals. …

These one-size-fits-all licensing rules make it harder to find new employees. They also contribute to high turnover in the profession, Zona says, because newly minted cosmetologists who never had a chance to try an entry-level job before getting a license often leave the profession because it’s different from what they expected. That’s not good for businesses, which want a stable workforce, and it’s even worse for those workers who wasted thousands of dollars and months of their lives.

This can’t be a problem only in hair styling, and if we consider the cost in human potential (for people who never find their vocation because of licensing walls) as well as in innovation (due to the loss of variety and perspectives), licensing is doing real harm to our entire society.

I’ve been extremely fortunate to be (for whatever reason) the sort of person whom others ask to do something when they just can’t find anybody.  I’ve done sales, teaching, graphic design, construction, and countless one-off projects for pay and as a volunteer.  Some of those efforts turned out better than others (some ended pretty badly), but that’s life, and outcomes vary dramatically even for people who go through years of training, but they’ve already invested so much that their options are limited.


Bringing Logic to the Net Neutrality Debate

The Sunday Providence Journal carried my op-ed on net neutrality:

Really, with what other service do people insist that customers’ only options must be everything or nothing? Should we all have to have the same gym memberships? Should every car have to have the same engine and the same sound system?

A preference for an all-or-nothing industry, as with health care, tends to mean that the advocates want to be able to control the “all” so they can control our lives. Auton and Holden probably have no such intent, but following their suggestion would clear a path for those who do.

One comment, from Mike Berry illustrates the challenge of political discourse these days:

Hard to follow the logic here.
Mandatory free and open access cannot possibly restrict what ISPs sell us. It does the opposite.
Internet access is not like gym memberships or auto service. It should be a utility in which, yes, we ALL get the same thing!!

Notice the immediate logical inconsistency in Berry’s response.  On the one hand, he says net neutrality “cannot possibly restrict what ISPs sell us”; on the other hand, he insists that ISPs should sell everybody the exact same thing.

Objectively, it appears that Berry is tangled up in the talking points.  Proponents of net neutrality use phrases like “mandatory free and open access” because that implies more access not less, but using a talking point doesn’t mean it’s accurate.  Maybe if Internet access were some boundless resource that could simply be plucked for free and distributed without limit, but that isn’t the case.

The mention of utilities is also instructive.  Think about your electric bill.  Regulators and activists are working to ensure that you cannot get electricity from coal while they force you to pay extra for politically favored energy like wind.

In that case, we’re only talking about how the product is generated.  With the Internet, the control of the “utility” would implicitly cover what we receive.  We’ll quickly find that disfavored content — the coal of the Internet — is blocked while we wind up with government fees on our bills to fund content or services to which we object.


Rhode Island Shouldn’t Let the Manufacturing Surge Pass Us By

To some extent, a commentary essay by  David Farr and Jay Timmons is a bit of a promotional spot for their organizations and the manufacturing industry generally, but this is broadly encouraging:

At the end of 2017, the National Association of Manufacturers surveyed its membership and the results were recording-breaking. Almost 95 percent of respondents felt positive about the outlook of their businesses — an all-time high in the survey’s 20-year history.

From our perch in Rhode Island, however, it’s difficult not to gulp a little at this:

Manufacturers’ newfound confidence didn’t happen by accident. Major developments in Washington, D.C., dramatically improved the business climate in the United States, most notably regulatory relief and, at the end of the year, historic tax reform.

It all freed up time, energy and resources that would otherwise have gone toward complying with complicated federal rules and the highest tax rates in the developed world. As a result, manufacturers are investing in their people and communities. We’re seeing story after story of businesses expanding their operations, offering raises or bonuses, buying new equipment and hiring new workers.

It’s early, yet, for state-level analysis, but early indications from economic data suggest that the national surge has been weaker in Rhode Island, if it hasn’t been passing us by entirely.  We need to impress upon our elected officials that they must change the approach of state government.

(via Stephen Green)


Misconceptions About Net Neutrality and Who Wants to Control Us

Rhode Island Library Association heads Kieran Auton and Julie Holden recently published an op-ed in the Providence Journal that opens with a misleading introduction and moves into a silly argument about net neutrality.  Here’s the introduction:

These days, when we talk on the phone, send a text, or stream a movie, we expect our experience to be seamless. If we are at work, at school, at home, or in the library, being online and being connected is a way of life. Yet, our state is economically diverse, and many cannot afford internet service in their homes. Every day, thousands of Rhode Islanders go to their local library for free high-speed internet access. In fact, libraries are the main provider of internet access for many in our

Ending net neutrality is not about allowing Internet service providers to put the screws to low-income households and low-revenue non-profits.  If anything, it opens the possibility of getting the Internet into households that don’t have it, because it allows the variation of plans.  Perhaps a low-income household can’t afford the cost of a plan with streaming television and video games but could afford a plan that allows its members to do job searches and school research and other classic Internet activities.  Perhaps a library could differentiate its Internet access, with a few dedicated machines for high-powered activity, but many more for activities more typical of a library, like reading and research.

The policy that Auton and Holden prefer is akin to forcing everybody to buy the same data plan for their cell phones.  Internet providers are companies.  They need customers, and they won’t stay in business long if they don’t give customers what they want.  Differentiation helps that objective.  Really, with what other service do people insist that customers’ only options must be everything or nothing?

Typically, the answer to that question is that a preference for an all-or-nothing industry, as with health care, tends to mean that the advocates want to be able to control the “all” so they can control our lives.


Pushing for Occupational Licensing

The RI Center for Freedom & Prosperity has today released a media and information page and an initial brief supporting reform of occupational licensing laws and other regulations.  From the second link:

Rhode Islanders Dream, Too. The right to earn a living in the profession of one’s choice without government interference is fundamental to each person’s freedom to fulfill his or her individual dreams and goals. In making Rhode Island a less friendly place to call home for Americans looking to fulfill a lifelong dream, to raise a family, and to build a career, our state government restricts that right by forcing too many of its residents to seek its permission and to overcome burdensome and costly barriers before engaging in meaningful work.

In a comprehensive national analysis of occupational licensing barriers for low-to-middle-income workers and aspiring entrepreneurs, a 2017 Institute for Justice report ranked Rhode Island among the 10 most widely and onerously licensed states. Already suffering bottom 10 rankings on the Family Prosperity Index (FPI), overall business climate, and on Jobs & Opportunity Index (JOI), Rhode Islanders should be provided with every opportunity to engage in gainful work.

Unfortunately, Rhode Island is becoming less of a “home of the free” and more of a “land that requires permission.” For many, the costly fees and training mandates that are irrationally and unfairly imposed on certain occupations presents an insurmountable barrier to engaging in a new profession. As one factor in its bottom 10 FPI ranking, the lack of opportunity to engage in prosperous work has forced tens of thousands of Rhode Islanders to move out of state, bringing with them billions of dollars of income earning potential.

Rhode Island’s dismal business climate, because of excessively high levels of taxation and regulation, keeps our state uncompetitive on a regional and national basis. Especially hard hit are low-income occupations for which earning a primary or secondary income is vital to family self-sufficiency.