Occupational Licensing Laws are Holding Americans Back

Occupational licensing laws are intended to protect consumers from unsafe services provided by unqualified individuals. Doctors and pilots, for instance, are licensed to guarantee that no one unqualified operates on someone or flies a plane. But recently, the practice of requiring a license has moved beyond consumer protection in highly skilled, high risk occupations, and has morphed into a barrier to entry, protecting established companies from outside competition. As states move to require licenses for more occupations, the consumer is not protected, but harmed by fewer choices, higher prices, and a shift away from customer focus.

A system that guarantees inefficiency

A license requirement disincentivizes individuals from pursuing careers in affected fields. That’s because obtaining a license requires time and money, which limits the number of individuals who would otherwise enter the marketplace. Faced with diminished competition, the negative impact on the consumer is amplified because existing businesses then have less incentive to provide a better service.

Growing trend

In the 1950s, occupational licensing laws only affected five percent of the American workforce. By 2015, nearly one in three workers now need a license to work. Far removed from simply guaranteeing safety, licensing has encroached into non-professional occupations that do not require extensive training.

These laws include licensing requirements for: hair braiding, locksmithing, packaging, auctioneering, being a florist, selling caskets, interior designing, teeth whitening, fortune telling and being a shampooer. Most consumers would unlikely be alarmed to find out their hair was braided by a renegade licenseless hair braider, or that their fortune teller failed to predict they needed a license to practice.

Costly and unnecessary

Not only do many occupational licenses seem unnecessary, but the requirements are often excessive and odd. The publication Rare reported that in Idaho, regulations make becoming a barber more difficult than a bounty hunter. In Washington, D.C., shoe-shiners are required to purchase a $337 permit. Becoming an interior decorator in Florida takes about six years. Sign language interpreter? Several states require a license for that too.

Per the Mercatus Center, preschool teachers, on average, must receive 1,728 days of training and pay more than $100 in fees to get their teaching license. Athletic trainers must pay, on average, $400 in fees. Other occupations that require more than $100 in fees include: Earth driller, cosmetologist, barber, skin care specialist and veterinary technologist. These licenses also require more than 100 days of training or experience.  These examples raise the question: who exactly is supporting this bureaucratic red tape?

Keeping people out of jobs

Unsurprisingly, the groups that lobby for the regulations tend to be the same groups that benefit from the lack of competition. The National Review reported that individuals with a certificate or license make, on average, $200 more per week than someone without one. Furthermore, the unemployment rate for individuals without a certificate or license is much higher than the unemployment rate for someone with one. For individuals who graduated from high school, but did not attend college, the unemployment rate for someone without a certificate or license is almost double that of someone who has one (5.9 and 3.1 percent, respectively). For individuals who did not graduate high school and have no certificate or license, unemployment is 8.2 percent, while for individuals with a certificate or license, it is 5.1 percent. These legal requirements are holding down the poor while artificially keeping unemployment higher than it otherwise would be.

The heavy licensing burden is an ever-growing problem. It is holding back Americans who are already in tough situations. Unnecessary licensing laws should be scaled back. If it turns out society erupts into chaos with unlicensed florists and fortune tellers, then we can re-examine the issue.

Tyler Arnold is a communications associate at Cause of Action Institute

Make the FDA small again

FDA regulation doesn’t just inconvenience Americans – it puts their lives at risk

Back in January, President Donald Trump vowed to cut the Food and Drug Administration’s (FDA) regulations by 75-80 percent, a dramatic policy shift from his predecessor who oversaw regulatory costs skyrocket to more than $100 billion annually. As debate centers on Dr. Scott Gottlieb, the president’s nominee to be the next FDA commissioner, Americans should follow this process closely.

No drug can be marketed in the United States without FDA approval. Over the years, the FDA kept numerous drugs off the market that were approved in other developed countries. According to an article published by the CATO Institute, one doctor estimates that these drugs could have prevented 200,000 American deaths over the last 30 years. One example is pirfenidone, a drug to treat pulmonary fibrosis, which didn’t get approved in the United States until 2014 even though it was marketed in Japan in 2008, Europe in 2011, and Canada in 2012. The FDA was advised by its own advisory committee to approve the drug in 2010, but the agency waited another four years after demanding yet another study on the matter.

Between 2010 and 2014, 150,000 Americans died from idiopathic pulmonary fibrosis, a disease that may have been treatable with this drug. Patients should not be banned from trying experimental medication if they and their doctors believe it is the best choice. The best way to speed up the process is for the FDA to allow the free market to function. The more power we give the FDA, the higher the risk of the agency cracking down on states that allow more freedom to terminally ill patients to make decisions for themselves.

This isn’t a conservative or liberal issue. This is an issue of saving lives and allowing sick Americans the right, with appropriate counseling on the risks, to make informed choices about trying experimental therapies.

The Boston Globe reported a troubling story about a woman who had two sons, both diagnosed with the terminal disease muscular dystrophy. The FDA allowed one of her sons to improve with the help of an experimental new drug, while forcing her to watch idly as her other son’s condition continued to worsen. Her younger son, Max, nine years-old at the time, qualified for a clinical trial of the experimental drug eteplirsen, while her older son, Austin, 12 at the time, did not. After 16 weeks, Max began to improve, which caused her to try to speed the FDA’s approval process for the drug.

The mother submitted an application for Austin again in 2013, and he was finally allowed to participate in a trial beginning in 2014. The FDA, however, didn’t approve the drug for everyone else for another two years.

Americans want safe drugs, but no one wants a bloated bureaucracy at the FDA to decide which terminally ill patients can and cannot benefit from a medicine that seems to be working. Giving this medicine to both sons earlier would have allowed them to improve together, but FDA regulators took away the right of this family and their doctor to make that decision.

There are many more examples. As the CATO article reports, individuals with Alzheimer’s were denied THA, individuals with cardiac problems had to wait for beta-blocker approval, individuals with kidney cancer were denied Interleukin-2, and AIDS patients died while the FDA debated whether AZT was cost-effective.

Multiple surveys by the Competitive Enterprise Institute show that medical professionals disapprove of the FDA’s slow pace in approving promising new drugs. A majority of Orthopedic Surgeons have said FDA’s approval process is too slow and hurts patients. A staggering 70 percent believe the current law should be changed to allow physicians access to unapproved therapies.

This debate is over whether individuals should have autonomy to make informed decisions about medical procedures, or whether an overly cautious federal agency can prevent them from trying what their doctor thinks is best. The solution is to get the federal government out of people’s lives and drastically cut the FDA’s role. Unelected bureaucrats who don’t know the individuals involved or the unique circumstances of the impacted families should not be making life-and-death decisions.

President Trump has signaled he wants to reform and streamline agencies’ regulatory power. In February, the president signed an executive order that requires all federal agencies to create a task force to help “alleviate unnecessary regulatory burdens placed on the American people.” The FDA is a prime target for such reform.

In 2012, Dr. Gottlieb, said that the review culture at the FDA needs to change to encourage innovation. He has also long been supportive of deregulation. Let’s hope he follows suit with what President Trump has promised to do and implements common sense reforms at FDA to give patients more freedom to make decisions for themselves.

Cause of Action Institute Joins Coalition Seeking Public Release of Congressional Research Service Reports

Congress needs to stop making it so difficult to get non-confidential information. To help make this reality, Cause of Action Institute signed onto a bipartisan coalition letter asking Congress to expand public access to non-confidential documents through the Congressional Review Service (“CRS”).  Congress should direct the CRS to create a system that provides free, easy access to all members of the public.

Virtually unknown outside of the D.C. beltway, the CRS plays an instrumental role in America’s legislative process.  The service provides policy and legal analysis for members of Congress in both parties.  Some of the reports it produces are confidential, but many of them are not.  The non-confidential reports could provide much-needed insight on legislative issues.  Considering taxpayers fund the CRS to the tune of $100 million annually, the public has a right to see its work.

Currently, the CRS permits public access to some documents, but the process is not simple and people have to jump through hoops to get reports.

The Congressional Review Service has suggested that there would be complications with releasing information, such as reproducing copyrighted information, needing to engage with the public and losing speech-and–debate clause protection.  However, these arguments are unfounded because its content has been cited in numerous media reports and court decisions.

For example, over the past ten years, Congressional Review Service documents have been cited in The Washington Post 67 times and The New York Times 45 times.  Moreover, the Government Accountability Office has made clear that the work of the U.S. government is not subject to copyright protection.

Confidential information must be protected, but  the public should be able to see what its government is doing and access the same information Congress uses to make decisions.