Abuse of Occupational Licensing Authority Can Run Very Deep

by Lewis Goldfarb

In Alabama, Even Burial Service Regulations Were Restrictive

Ms. Sheila Champion, founder of the Good Earth Burial Ground in Hazel Green, Alabama, sued that state, challenging a law limiting the sale of caskets to licensed funeral directors. The State was also requiring her to first attend a mortuary college, serve a two-year apprenticeship, build a funeral home and pay thousands of dollars for a license before she could legally offer her products and services.

Those restrictions may not seem unreasonable, except for the fact that Ms. Champion was attempting to sell biodegradable caskets, including burial services, for under $2,000; dramatically less than the $8,500 typical cost of the same service. She was also seeking to serve the interests of those consumers who care about the sustainability of the Earth’s natural resources.

Ms. Champion’s lawsuit is the latest in a growing number of challenges to state licensing rules that unreasonably stifle competition by exceeding legitimate state interests in protecting consumers from incompetence and fraud by service providers.

In the past year alone, class actions and other lawsuits challenged licensing requirements that:

  • Prohibit physicians in Texas from performing diagnoses from remote locations via webcams;
  • Impose a supplementary, subjective screening test on hearing aid specialists that no one passes on the first attempt in Tennessee;
  • Prohibit a computer services company from offering a service that enables construction lien holders to prepare and file construction liens via computer in Ohio;
  • Prohibit non-physicians from having an ownership interest in pain clinics in Mississippi despite the fact that all medical services are performed by physicians only;
  • Prohibit a massage therapist from providing therapeutic rubdowns for horses without first obtaining a veterinary degree and becoming a licensed veterinarian in Arizona.The motivation behind such anticompetitive forces is, in part, a product of basic human nature, commonly referred to as the “gangplank theory”: When members of a profession or vocation are called on to determine who gets to play and under what rules, the outcome is often tilted in favor of those already on the field.
  • In Ms. Champion’s case, however, pushing back on overly restrictive laws was well worth the effort. Largely as a result of her lawsuit, on May 2, 2016, Alabama Governor Robert Bentley signed a bill lifting the restrictions on who can sell funeral supplies and merchandise, enabling Ms. Champion to continue her business.
  • The stated rationale for all of these restrictions on access to vocations is the need to protect consumers. Unfortunately, that objective often serves as a shield to mask the enactment of excessive laws and regulations that block access to those entrepreneurs seeking to take their first step up the economic ladder.  The impact of these restrictions is often particularly harsh on lower income workers who may not be able to pay the additional educational requirements or the fees required to obtain a license.

Introducing our “Over-Licensed” Blog

by Lewis Goldfarb

There appears to be a long-overdue awakening in this country regarding the restraints that “over-licensing” of occupational pursuits can impose on the economic opportunities for individual citizens, as well as the health of our free enterprise system.

As never before, licensing boards are being challenged to do a better job reconciling the legitimate objective of protecting the public with the equally lofty goal of enabling those with the skills and experience to climb the career ladder of their chosen profession without unnecessary or unfair restraint.

This “Over-licensed” blog is intended to provide news, insights and commentary on efforts to rein in the excesses of state licensing requirements and the trade associations they often protect, to insure that all citizens have a fair opportunity to pursue the vocation of their choosing. Our blog will also be used to communicate the positions of the Institute for Occupational Licensing Reform, MDM&C’s public advocacy organization dedicated to researching industry abuses and promoting best practices in occupational licensing.

In addition to this blog, we intend to pursue other advocacy opportunities to increase public awareness of issues related to over-licensing, including educational seminars, testimony before State licensing boards,  and participation in industry events.

We welcome your continued interest and participation in this blog, and more importantly in this timely subject.. Please let us know your thoughts and opinions as we work together to ensure the individual’s right to pursue the work of their choosing, which serves as a cornerstone of our democracy.

Welcome!

by Lewis Goldfarb

Welcome to the new MDM&C Overlicensing Blog!  Through this medium we intend to provide a running commentary on the forces underway that are working to rein in the excesses of state licensing requirements and the trade associations protected by them, to insure that all citizens have a fair opportunity to pursue the vocation of their choice.