Individual Liberty18 February 2016

Notes from Norm: It’s Frozen Over When Franken and I Agree

Hell, like thousands of Minnesota’s lakes, may have finally frozen over.

Al Franken and I agree on something!

To be fair, I suspect Senator Franken and I agree on any number of things.  We both love our family, Minnesota and, well, let me think about what else we agree on.

Oh, that’s right!  We both agree that the rapid rise of occupational licensing in America is doing far more harm than good for the American people.

The reality that it's a lot simpler (and less cost to the taxpayer) to check qualifications on Angie's List –or whether someone has been certified by their Union — than have a government bureaucracy make that determination, may finally have caught the attention of politicians on both sides of the ideological aisle.

In a recent Subcommittee on Antitrust, Competition Policy and Consumer Rights hearing entitled “License to Compete: Occupational Licensing and the State Action Doctrine” Senator Franken, in an exchange with Robert Johnson from the Institute for Justice, made this statement and asked this question:

“I think it’s clear that we have some unnecessary occupation licensing that can harm workers and consumers in a number of ways. Can you explain why low income individuals and people of color both as workers and consumers may be disproportionately impacted by occupational licensing.”

Johnson went on to explain to Senator Franken out of control occupational licensing hurts those who are already hurting most in America today.

“It’s simply more difficult to become licensed if you’re someone who’s at the bottom rungs of the income ladder. You don’t have time to take classes to become a cosmetologist which for instance might take years of education. If you’re working paycheck to paycheck, trying to make a living…how are you going to find the time? It can also be very expensive to become licensed to take those courses…it’s not free. These kinds of requirements impact people who are just getting started and who are trying to make their way in the world. Naturally, the communities most affected disproportionately less well-off.”

The notion that every job in America needs to be licensed is the fantasy created by those who believe government should have a role in every aspect of American life.

More ominously, it is also a fiction created by those who want to limit competition within their industry by making it harder and more difficult for people to potentially become their competition.

In Nevada, for example, it takes 890 days to become a barber. Worse yet, there is only one state in America that doesn’t license barbers and that is Alabama.  

According to testimony before Congress the average person spends nearly a year in training and spends over $130 to become a licensed barber.

Other jobs that require licensing include cosmetologists – who are required to be licensed in all 50 states — Commercial carpenters and cabinet makers who are required to be licensed in 29 states.

And, as a story in Politico points out, there are seven states that regulate tree trimmers “… forcing them to fork over $174 and spend 369 days learning the ropes.”

Out of control occupational licensing isn’t just a blow to commonsense and a nod to the ever increasing expansion of government in our lives, it also has a direct impact on jobs.

Dr. Morris Kleiner of the University of Minnesota estimates that 2.85 million less jobs are available in the United States because of our growing obsession with licensing.

And, the burden of those job losses are predominantly felt by low and middle income Americans – essentially those who don’t need any more impediments to their ability to move up the economic ladder.

According to a policy brief by the Ewing Marion Kauffman Foundation entitled, “Occupational Licensing:  A barrier to entrepreneurship.”

“About 29 percent of jobs require a government-issued license—a dramatic increase from just forty years ago when only 10 percent of workers were licensed. These licensure requirements result in fewer practitioners, who can demand higher wages, while also stifling new business creation and innovation.”

The American economy under Barack Obama has been tough on everybody but, perhaps toughest of all on the poor and middle class.  With poverty and homeless rates at historic highs through the Obama Presidency, allowing more barriers to entry to the job market is not what America needs right now.

The first step to economic recovery for millions of Americans is admitting we have a problem.

If Al Franken and I can both see and agree the damage this obsession with licensing is having on job creation in America, it’s pretty obvious just how damaging it has been to our fellow citizens trying their best to find a job.