Posts tagged with: occupational licensing

If you visited a florist would you immediately walk out if you found out it wasn’t licensed by the state? Would a florist shop still know how to perform their job without a state certificate? In most instances occupational licensing laws serve to protect commercial interests and not the consumer. Far too often these laws work directly against the entrepreneur. Melony Armstrong, who owns “Naturally Speaking,” fought back against the cumbersome and archaic cosmetology licensing laws that tried to prevent her from opening up a braiding and weaving business in Tupelo, Miss. She was barred from opening up her business because she didn’t spend multiple years training in cosmetology schools that would have cost her $10,000.

Small businesses are the backbone of America’s economy and unnecessary licensing laws severely limit the opportunity to start a business or simply find work. It is irrational to require licensing for some professions, and it puts an unfair burden on the poor. It blocks their access to markets, squashes human flourishing, and limits their ability to provide for their family. The fact that some states require professional licenses for certain professions and other states don’t require a license for that same profession, highlight that it has little to do with public safety. Honest Enterprises has produced an excellent video chronicling Melony’s story to fight against damaging and needless regulation and the impact it has had in her community.

Blog author: John MacDhubhain
posted by on Thursday, July 19, 2012

It’s hard to think of anything more onerous than preventing enterprising people from entering the market. To do so is to interfere with their ability to serve others and engage in their vocation. It keeps people poor by preventing them from improving their lives. And one of the worst barriers of this kind is a type of law known as occupational licensing.

And that’s exactly what a group of monks in Louisiana ran into in 2010 when the state government tried to prohibit them from selling handmade caskets to their fellow Louisianians. Kevin Schmiesing wrote on that issue in 2010 on the PowerBlog.

It’s the coffin business that got St. Joseph’s in trouble. By selling its pine boxes without a funeral director’s license, the monastery violates state law. So the abbey is suing the State of Louisiana in federal court.

It’s a classic case of what economists call “barriers to entry”: regulations put in place by existing businesses or professionals to limit competition and thereby drive up prices and compensation. Usually the vested interest posits some rationale concerning the public good (e.g., not just anybody should be allowed to practice medicine…), but frequently enough the reasoning is pretty thin (e.g., should you really need a license to cut hair or drive a taxi?).

The monks are represented by the libertarian public-interest group, Institute for Justice. They won their case in 2011 and appeared last month before a Federal Appeals Court. A decision won’t be out for several months.

This all started when the Benedictine monks at Saint Joseph Abbey started receiving several requests from their community to sell caskets that the monks had constructed for their own deceased members for many years. In a hard hit post-Katrina Louisiana, this seemed like a reasonable way for them to serve their community and bring in some money to the abbey. Unfortunately, they ran into occupational licensing laws, which forbid non-funeral homes from selling caskets. The Institute for Justice argued that such laws could only serve to reduce competition and drive up the prices of caskets. The BBC has a good video on their troubles with the state. (more…)