regulation: open letter to collegues

regulationDear Colleague, 

I hope that you all are well and enjoying your last week of 2015. I have pasted below a recent editorial from the Wall Street Journal that I believe illuminates a problem that we can take steps toward solving here in SC–over regulation. I am particularly struck by these two comments from the article: “It takes 372 days on average to become a licensed cosmetologist, but only 33 days to become an emergency medical technician…”, and “If nonviolent ex-offenders who paid their debt to society aren’t able to obtain a license for certain types of employment, how can we expect them to rejoin society, partake in American life, create value in their communities and improve their lives” Not only is our regulatory system seriously out of balance, but it hurts those very people in society whom we most need to help by clearing barriers from their paths.

I hope that you will take a moment to read this article and consider how we might work on solving this problem. I am committed, as a member and subcommittee chair of the Labor, Commerce and Industry Committee, to doing all that I can to reduce the burden on our businesses and citizens, especially those whose other life circumstances stand in the way of their ability to meet an arbitrary, and usually extremely high, set of standards in order simply to pursue a vocation and provide for their families. I hope that you will let me know your ideas, and I look forward to seeing you soon.

I look forward to working with you toward these goals as the session begins in January. 

Happy New Year! Sincerely, Kevin

By MARK V. HOLDEN Dec. 8, 2015 6:48 p.m. ET

More than 200 years ago, Thomas Jefferson wrote: “The natural progress of things is for liberty to yield and government to gain ground.” Although Jefferson didn’t have CrossFit trainers, cosmetologists, hair braiders and ride-sharing companies in mind when he penned this prescient line in a letter to Edward Carrington, they’re a perfect demonstration of the truth of the sentiment.

Earlier this year the White House released a report detailing how occupational licensing laws affect the economy: “more than one-quarter of U.S. workers now require a license to do their jobs” and “the share of workers licensed at the State level has risen five-fold since the 1950s.”

If that sounds benign, consider that licenses for low- and middle-income professions on average cost more than $200 and require nine months of training and at least one exam, according to the Institute for Justice. There’s scant evidence that these hurdles improve quality or safety, so why does government make it so difficult for Americans to improve their lives by plying a new trade?

It takes 372 days on average to become a licensed cosmetologist, but only 33 days to become an emergency medical technician, known as an EMT. In several states, a hair-braiding license requires 1,500 hours of training and multiple exams. For those with limited means, that may prove impossible.

Rather than removing these obstacles, government at all levels increasingly protects the “haves” at the expense of the “have-nots.” Consider the response to Uber, which threatens the municipal taxi system monopoly. Instead of allowing entrepreneurs to develop services that succeed or fail on the merits, politicians have encouraged businesses to seek out favors. As a result, politicians try to protect their supporters from competition instead of encouraging it.

Last year the city council of Washington, D.C. passed a measure requiring CrossFit and other fitness trainers to register with the mayor’s office and pay a fee. But it was heartening in September to see the council take steps to scrap the idea of requiring them to obtain a license from the city.

Who pushed for these laws? The Board of Physical Therapy, a little-known agency within the D.C. Health Department charged with regulating the practice. This board, composed mostly of physical therapists, is a textbook case of a special interest working with the government to restrict competition.

Lawmakers across the country are beginning to see the folly of such requirements. Legislators in Georgia, Idaho, Iowa, Michigan and Wisconsin are considering abolishing and even prohibiting new occupational licenses.

The harm of licensing rules shouldn’t be underestimated: By one assessment, such regulation has prevented the creation of nearly three million jobs and lowered entrepreneurship rates. Instead of licenses, states could require certification, a lower qualification that doesn’t bar outsiders from offering a similar service.

Reducing burdensome requirements on job seekers is part of reforming the criminal justice system. If nonviolent ex-offenders who paid their debt to society aren’t able to obtain a license for certain types of employment, how can we expect them to rejoin society, partake in American life, create value in their communities and improve their lives? By removing these needless barriers to opportunity, we can offer a hand up to the people who need it most.

Mr. Holden is general counsel and senior vice president at Koch Industries.