Ending unnecessary licensing is about your right to make a living

Ours is a pretty divided nation these days, it’s hard to deny. That makes it all the more heartening to see issues where there is growing consensus in both parties.

We’ve seen that in Republicans and Democrats alike rethinking our civil asset forfeiture laws (though the president has expressed some support for them). They’re questioning the propriety of seizing the property of people who have not been convicted of a crime.

There is renewed attention as well on people’s right to make a living, specifically by removing unnecessary occupational licensing schemes. Too often, these license requirements serve little purpose beyond being a barrier to keep people out of the market. Rep. Matt Manweller (R-Ellensburg), who takes matters of economic freedom seriously, has a new bill aimed at unneeded restrictions.

Keeping potential competitors out for “health and safety”
In many cases, established businesses are only too happy to block potential competitors from offering their services. Occupational licenses are one anti-competitive tool, and the results are bad for consumers and for entrepreneurs.

We’ve seen some of these fights play out in Olympia in recent years, notably over what procedures and consultations different levels of medical professionals are allowed to perform. Clearly there are health and safety implications to some of those decisions, which is the most commonly cited reason for the need for licensing.

But frequently, “health and safety” is just an excuse. No one doubts that, say, surgeons need to be thoroughly trained and licensed. But what about boxing announcers? Washington state requires they be licensed, along with auctioneers, landscape architects, and a host of other occupations.

For many years, hair braiders needed a full cosmetology license (an unnecessary barrier that was only fixed due to an Institute for Justice lawsuit). The requirement was justified on health and safety grounds. But what was the public protected from by requiring 1,600 hours of cosmetology instruction and for braiders to pass a licensing exam focused on equipment cleaning and hair dye chemicals?

The only “protection” was for cosmetology school operators and those who already had their cosmetology license. Something as simple and harmless as braiding hair should not require thousands of dollars spent on schooling and a stamp of approval from the state.

A license implies oversight, but frequently that isn’t the case
Licensing also implies that the state is performing oversight, but frequently that isn’t the case. Todd Myers, who helped draft the bill with Manweller, testified this week that even though plenty of complaints are filed with the state against landscape architect firms, “in the last three years there is a total of zero investigations.” He also offered an illustrative story:

“I happened to mention this to my wife last night when I was putting my testimony together and she said, ‘Oh yeah, I filed a complaint two months ago [about] a landscape architect, but I did it with the Better Business Bureau.’ The reputational value of Yelp, Better Business Bureau, and things like that are being used, and the current occupational licensing system is simply not for landscape architecture.”

Online reviews are far more important to a business’s reputation than anything the state is doing – or, as Myers pointed out, not doing. Yelp and the Better Business Bureau have a larger impact, and the state doesn’t have the resources to conduct investigations. If a state license doesn’t involve oversight or resolving problems, isn’t it falsely giving an imprimatur of expertise or honest-dealing?

When a license is merely a matter of checking off all the boxes and paying the state, it’s just paperwork. It’s a barrier that especially hurts low-income entrepreneurs who just want to work to provide for their families. Kudos to Manweller and company for standing up for these embodiments of American hustle.
-Rob McKenna

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Rob McKenna
Rob served two terms as Washington’s Attorney General, from 2005 to 2013. He successfully argued three cases before the U.S. Supreme Court and negotiated three of the largest consumer financial protection settlements in national history, all involving mortgage lending and servicing. He is a recognized leader in the development of consumer protections on the internet, in data protection and privacy regulation.