REGULATORY ROBBER BARRONS
July 25, 2006
Government regulation very often has the effect and even the intention of preserving the success of the incumbent businesses by crowding out smaller companies and erecting barriers to entry, according to Tim Carney's new book, "The Big Ripoff: How Big Business and Big Government Steal Your Money."
- In Pennsylvania, a state law that keeps prices high for hair-braiding. Hair braiders must take a 1,250 hour training course in "cosmetology" before they can legally braid hair in Philadelphia or anywhere else in the state.
- Louisiana florists can run afoul of the law if they practice floristry without a license. The state requires any would-be florist to pass a licensing exam. Who are the judges? They are currently practicing florists. The result: a majority of applicants fail. In short, the state has given current florists the power to keep potential competition out of the market.
- In Arizona, it's illegal to spray weeds if you are a renter, but it's also illegal for your landlord to spray. Licensed gardeners need 3,000 hours worth of experience spraying weeds, otherwise the Arizona Structural Pest Control Commission (SPCC) may come after you both.
- In Oklahoma and Tennessee, casket sellers have a similar cartel.
- In Florida, currently practicing athlete's agents comprise the athlete's agents licensing board, which gets to decide who can or can't represent an athlete.
All of these "pro-consumer" license requirements not only hurt would-be florists, casket sellers, and agents, but the consumers, too, who pay higher prices in the squeezed market, says Carney.
Source: Timothy Carney, "Regulatory Robber Barons," Competitive Enterprise Institute, July 10, 2006.
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