"The Licensing Racket," by Philip Hamburger, exposes the pervasive and often absurd world of occupational licensing in America. Hamburger argues that these boards, ostensibly designed to protect the public, frequently serve as protectionist barriers for existing practitioners, stifling competition and harming consumers with higher prices and reduced access to services. He details the often arbitrary and onerous requirements imposed on aspiring professionals, from florists and interior designers to fortune tellers, illustrating how these regulations disproportionately impact lower-income individuals seeking economic advancement. The book ultimately calls for a reassessment of the necessity and scope of occupational licensing, advocating for deregulation and a return to more open markets.
Within the esteemed pages of the Wall Street Journal, a meticulous and comprehensive review, penned by the erudite Barton Swaim, dissects the weighty subject of occupational licensing in America as presented in Professor Morris Kleiner's insightful new work, "The Licensing Racket: A State-Level View of Occupational Regulation." Mr. Swaim's analysis delves into the profound implications of the book's central thesis, eloquently articulating Professor Kleiner's argument that the pervasive web of licensing requirements across a vast spectrum of professions, from barbers to interior designers, serves not primarily as a bulwark protecting the unsuspecting public from incompetent practitioners, but rather as a formidable barrier to entry, effectively stifling competition and artificially inflating prices.
The review painstakingly elucidates Professor Kleiner's meticulous research, which meticulously documents the historical evolution of licensing regimes across the United States, demonstrating how these regulations, often enacted under the guise of consumer protection, have morphed into mechanisms for established professionals to safeguard their own economic interests. Mr. Swaim highlights the book's compelling examination of the intricate interplay between state legislatures, professional associations, and lobbying groups, revealing how these entities collaborate to erect and maintain these licensing barriers. He further emphasizes the profound economic consequences of this regulatory overreach, noting the demonstrable negative impact on job creation, economic mobility, and consumer affordability.
The review meticulously details the myriad examples provided by Professor Kleiner, illustrating the absurdity of some licensing requirements, where the mandated training and examinations bear little relevance to the actual practice of the profession. Mr. Swaim lauds Professor Kleiner's rigorous data-driven approach, which effectively dismantles the oft-cited justifications for extensive licensing, revealing the lack of empirical evidence to support the claim that these regulations meaningfully enhance public safety or professional standards.
Furthermore, the review explores the broader societal ramifications of this licensing labyrinth, emphasizing the disproportionate burden it places on lower-income individuals and aspiring entrepreneurs, effectively hindering their ability to pursue their chosen livelihoods and contribute to the economic vitality of their communities. Mr. Swaim underscores the book's call for a comprehensive reevaluation of the existing licensing framework, advocating for a more targeted and evidence-based approach that prioritizes genuine consumer protection while simultaneously fostering a more dynamic and inclusive marketplace. In closing, the review commends "The Licensing Racket" as an indispensable contribution to the ongoing debate surrounding occupational regulation, offering a cogent and compelling critique of the current system and providing a roadmap for meaningful reform.
Summary of Comments ( 94 )
https://news.ycombinator.com/item?id=42982578
Hacker News users generally agree with the premise of the WSJ article, lamenting the excessive licensing requirements across various professions. Several commenters share personal anecdotes of burdensome and seemingly pointless licensing procedures. Some highlight the anti-competitive nature of these boards, suggesting they serve primarily to protect established professionals and inflate prices. Others point to the variability of licensing requirements across states as further evidence of their arbitrary nature. A few commenters discuss potential solutions, including deregulation and national reciprocity agreements, while acknowledging the difficulty of implementing meaningful reform. The discussion also touches upon the historical context of licensing, with some suggesting it originated as a way to ensure quality and protect consumers, but has since morphed into a protectionist racket.
The Hacker News post titled 'The Licensing Racket’ Review: There's a Board for That has a moderate number of comments discussing various aspects of occupational licensing.
Several commenters share personal anecdotes about the burdens of licensing requirements. One user describes the extensive and costly process of becoming a licensed massage therapist, highlighting the disparity between the required schooling and the actual practice. Another commenter mentions the difficulties faced by military spouses who have to re-license in every new state they move to due to their spouse's deployments, creating a significant barrier to employment. A different user points out the absurdity of requiring licenses for professions like interior design, questioning the necessity of government intervention in such fields.
The economic implications of licensing are a recurring theme. One commenter argues that licensing creates artificial scarcity, driving up prices for consumers while limiting opportunities for aspiring professionals. Another echoes this sentiment, suggesting that licensing boards often serve to protect established businesses from competition rather than ensuring public safety. Someone else brings up the potential for regulatory capture, where licensing boards become dominated by industry insiders who use their power to benefit themselves at the expense of consumers and smaller businesses.
A few commenters discuss the historical context of licensing, with one suggesting that it initially emerged as a way to exclude certain groups, particularly African Americans, from specific professions. Another user points out that the rationale behind licensing varies depending on the profession, with some licenses genuinely serving to protect public safety (e.g., doctors, electricians) while others seem more focused on restricting competition.
Some commenters offer alternative solutions to the problems posed by excessive licensing. One suggests mutual insurance or certification programs as less restrictive ways to ensure quality and accountability. Another proposes relying on customer reviews and reputation as a market-based mechanism for regulating professions.
While there's a general consensus among commenters that occupational licensing is often excessive and burdensome, some acknowledge that it does have a legitimate role to play in certain professions. The debate centers around finding the right balance between protecting public safety and allowing for economic opportunity. The overall tone of the comments is critical of the current licensing regime, with many users calling for reform and deregulation.