Leading the Revival of Individualism & Self Reliance

Posts

Licensing Boards Are Inhibiting Free Competition in the Market

/in /by

Imagine attempting to open a bakery that specializes in cakes. But before the business can even get off the ground, the government pays you a visit and informs you that unless you also bake and sell pies in addition to the cakes, it will not allow you to legally open your bakery.

This sounds silly to you at first, but the government insists that since pies and cakes are traditionally both sold in bakeries, that is just how the law works. You can either comply or abandon your dream of owning a specialty cake bakery.

Regulations Are Stranger Than Fiction

While this may be nothing more than a fictional scenario, regulations this outrageous do exist. And what is worse, they prevent many from obtaining their entrepreneurial dreams. In fact, a similar situation is currently happening in North Carolina, where one makeup artist’s dream of opening a cosmetology school is being stifled by a peculiar occupational licensing law.

North Carolina resident, Jasna Bukvic-Bhayani wants to open a school where hopeful cosmetologists can come to learn the tools of the trade. As a makeup artist herself, Bukvic-Bhayani found teaching makeup artistry to others to be both rewarding and lucrative. But the state shut her down before she could even begin.

As a certified cosmetologist, she has already obtained all the permits and licenses necessary to practice her craft in exchange for compensation. But even though she is permitted to practice cosmetology she is forbidden from teaching this craft to others unless she also teaches esthetics.

The field of esthetics involves procedures like microdermabrasion, body waxing, and facials, none of which Bukvic-Bhayani desires to teach at her school. Even still, the North Carolina Board of Cosmetic Art Examiners told her that unless she intends on turning her school into an esthetic school as well as makeup artistry the state will not allow her to open up for business.

But incorporating esthetics into her curriculum isn’t as easy as simply taking a few weeks to go over the basics. Instead, this will force her to spend at least $10,000 on esthetic equipment in addition to the hundreds of wasted hours she will spend teaching a skill she doesn’t want to teach. For a student to be a state-certified cosmetologist they must complete at least 600 hours of esthetic training, whether they want to practice this skill or not.

Bukvic-Bhayani has insisted that esthetics is not a part of the business model for her school, but the state doesn’t care. Since many cosmetic schools also teach esthetics, the state claims that this should be the norm for anyone wanting to open a school involving cosmetology in any way.

Surveying the Competition

What is even more disturbing than the fact that Bukvic-Bhayani is being prevented from reaching her entrepreneurial dream is how the state came to learn of her school’s existence in the first place.

In order to attract prospective students to her school, Bukvic-Bhayani paid for online advertising. Unfortunately, the North Carolina Board of Cosmetic Art Examiners makes a habit of monitoring facebook ads in an attempt to catch those who may not be following their rules. This is exactly how Bukvic-Bhayani came to be on the board’s radar.

And this type of monitoring is not specific to the realm of cosmetology. A year ago, a mother was fined after a health inspector caught wind that she was selling Ceviche that was not first approved by the state’s health department. By scouring facebook groups that serve almost as digital farmer’s markets, these regulatory boards have prevented many individuals from earning a living.

These boards also encourage a dependence on the state before one is able to put forth an entrepreneurial idea and getting ahead in life.

In the Road to Serfdom, F.A. Hayek even warns often of the dangers that follow when a state bars entry to certain vocational fields. It is certain he would be disgusted today to see just how far this practice has expanded.

These regulations are usually crafted by those already in the field. By setting all these hefty regulations, they can limit who is allowed to enter the field. In other words, they are given the unjust privilege of deciding who is allowed to compete in the free market, and who is not. 

Luckily, the nonprofit organization, Institute for Justice has come to Bukvic-Bhayani’s aid and is helping her fight for the right to earn a living. And they have found a rather creative way to combat this regulation.

The First Amendment protects an individual’s right to speak for a living. But this protection does not extend only to the individual’s right to speak out against the government. It also extends to one’s profession. This serves to protect speakers, authors, journalist and yes, even makeup artists.

Institute for Justice has a long track record of doing its best to fight for the rights of those who want nothing more than to earn a living without fear of government intrusion. Hopefully, this story will end with the opening of Bukvic-Bhayani’s cosmetology school.

How One Millennial Fought Back Against Red Tape

/in /by

Millennials have been major catalysts in changing the rules of the traditional marketplace. Impatient and eager to move on to the next big thing, we are a generation born to innovate. But venturing into uncharted territory, though groundbreaking, means that we have to force the traditional market to evolve with our revolutionary methods.

From the sharing economy to food trucks and hipster-made craft beer, millennials have found a way to make money in a manner that fits their unique lifestyles. As with most successful market endeavors, the only thing preventing millennials from making an even greater impact on the economy is government bureaucracy.

Rebecca Mueller left her career in the finance world to pursue her dream of being a fashion designer. After graduating from fashion school in Chicago, Mueller decided not to relocate to greener pastures and instead set out to contribute to the local economy.

Planning to buy all her supplies from local vendors, Mueller wanted to open up a mobile boutique that would operate like a closet on wheels. Confident in her interpretation of the city statutes on peddler licenses, Mueller headed to City Hall full of hope and ready to make her dream a reality. It didn’t take long for her dream to turn into a bureaucratic nightmare. At City Hall, she was denied her peddler’s license.

Mueller had purchased a 25-foot truck and had planned to stop at different locations around the city and sell her original clothing. Unfortunately, the city informed her that in order to qualify for a tradition peddler’s license, she would not be able to park her mobile boutique and set up shop. This is a problem that many foods truck owners have faced while attempting to start their businesses.

The city assured Mueller that they were working on legislation to cater to innovative businesses like hers, but there was no clear answer as to when this would actually happen. After months without any real answers, Mueller was no closer to opening up her boutique.

Enter Institute for Justice

Desperate to get the wheels rolling, she decided to seek help from Institute for Justice’s (IJ) law clinic on the University of Chicago campus. IJ was able to tell Mueller what the government neglected to, that in fact there was a license available that would allow her business to operate her unique business.

The “emerging business license” was created in 2012 to accommodate for innovative businesses which do not fit into preexisting regulations. The emerging business license gives the entrepreneur two years to operate their business. The understanding being that in those two years, the local government will work to create reasonable regulations. However, prior to Mueller’s inquiry, the license had only been issued once since 2012. Fortunately for Mueller, she was able to get approved for the emerging license and after large amounts of time and money were spent, her mobile boutique was able to open up earlier this month.

When it comes to innovative Millennials trying to start new businesses, Mueller’s sentiment expressed in her local op-ed really drives the point home:

I hope the next novel business to make its way to City Hall is met with a red carpet instead of a maze of red tape.

We Should Encourage Child Entrepreneurs, Not Fine Them

/in /by

Over the past several years, there has been a crackdown on child entrepreneurs. Where homemade lemonade stands and bake sales once represented the innocence of childhood curiosity, they are now being shut down by local authorities who demand these children obtain licenses before they can make a profit. But the crackdown isn’t limited to food-based businesses alone.

This last summer, a local news outlet in Alabama reported that in the city of Gardendale, teens mowing lawns for extra summer cash have been routinely stopped and accosted by local authorities for failing to obtain a government license permitting them to earn money. The license these young entrepreneurs are being asked to obtain costs a whopping $110 dollars. For these teens who are only charging about $20 per lawn, this cost is a huge burden.

Highlighting just how ridiculous this enforcement of occupational licensing has been on minors, John Stossel ran a segment on his show a few years ago explaining how tedious it has become to open up something as simple as a child-run lemonade stand. In fact, if these children were to comply with state regulations, Stossel estimated it would take several months and a decent amount of cash just to open a simple lemonade stand.

Luckily, one state is taking the lead on protecting children from the long arm of the state.  

The Beehive State Comes to the Rescue

Tucked away in the Rocky Mountains, the state of Utah is known as the industrious beehive state because of its tradition of hard work. While other states have been quick to shut down children wanting to learn about the free market, Utah has taken preemptive measures to protect minors in their quest to earn money.

Connor Boyack, a Utah resident and a longtime advocate for liberty has made a full-time job out of protecting the rights of Utah citizens. As president of the burgeoning Utah think tank, Libertas Institute of Utah, Boyack began running his new nonprofit from his home, while he made plans to grow his operation and find a more suitable location. It was during this time that Boyack was alerted by city officials that he was not allowed to run a business out of his home without the proper permits. Of course, as a nonprofit Boyack was not bringing in any money that was not spent directly on Libertas’ initiatives, but the city regulators didn’t seem to care about that vital detail.  

Learning the hard way that you can’t fight city hall, Boyack decided to take a different approach against the burden of occupational licensing: focusing on the children.  

Won’t Somebody Please Think of The Children!

When compared to other states, Utah has actually been very friendly towards child-run businesses and the Libertas Institute would like to keep it that way: which is why they worked with the state legislature to craft a bill that would prevent minors from having to comply with the burdensome regulatory process.

Prior to the bill being passed, residents of Provo, Utah held a children’s market in the parking lot of a privately owned inn. Boyack’s own children participated in this endeavor, selling homemade marshmallow shooters constructed by the children out of PVC pipes. Each shooter retailed for $3 and came with a small bag of marshmallows.

Since the market took place on private property, there was not much local law enforcement could do to stop it. However, this fact alone gave Boyack inspiration for the language of the bill.  

Originally, the bill protecting childhood entrepreneurs sought to guard home-based businesses against state intervention. However, many child-run lemonade stands are not operated solely on privately owned property. Often, these amateur businesses are operated on neighborhood street corners or sidewalks, which are unfortunately considered public property.

Perhaps the greatest aspect of this bill is that by focusing on the children, it helps entrepreneurial adults as well. Boyack was able to tap into sympathies that played well with state legislatures, after all, no one wants to be responsible for killing legislation aimed at helping children.

Senate Bill 81  amends existing laws requiring occupational licenses and permits for certain businesses, specifically those run by minors under the age of 18. However, it also helps adults by demolishing any fees associated with the required permits. True, Utah residents over 18 will still have to obtain the government’s permission before operating a home-based business, but they will no longer be forced to pay exorbitant fees.

In fact, by eliminating the fees associated with home-based occupational licensing, the state of Utah stands to lose about a million dollars in annual revenue previously collected from those looking to run their own businesses out of their home.

While the overall goal is still to eliminate all occupational licenses, protecting minors in their entrepreneurial pursuits is an excellent starting point and has made a huge impact across the state.

As Boyack himself put it, “Let’s at least give kids a taste of the free market before the crushing bureaucracy weighs in upon them.”

Government Red Tape Forces Nutritionist out of Business

/in /by

Heather Kokesch Del Castillo was unsatisfied with her career. Instead of resolving herself to a life of unfulfillment, she took a risk and made the bold decision to live the life of an entrepreneur.

In 2014, she started “Constitutional Nutrition” in California. As a nutritional coach, she provided her clients with one-on-one dietary counseling. She spent years establishing herself in the field and was able to build a profitable business with a large clientele base. But that was before the government shut down her business. 

Now, Heather must endure a bureaucratic circus and pay a large fine before she is legally allowed to reopen her business and earn a living once more.

It sounds almost outrageous to think that the government would stand in the way of an individual’s quest to provide for themselves. But it happens all the time. And in Heather’s case, it happened because she didn’t first obtain an occupational license from the state.

When Heather started Constitutional Nutrition, she was living in California. While California is generally heavily regulated, it does not have any license requirements for aspiring nutritionists. Those wanting to start consulting in that realm are free to do so. They are even free to call themselves “nutritionists.”

But regardless of the law, or lack thereof in the case of California, Heather still went out of her way to get licensed by an independent firm. Though not mandated, it was still an effective way to gain the trust of consumers. Constitutional Nutrition eventually took off and the clients came pouring in. Heather’s risk had paid off and she was able to create value for many willing consumers. But when her husband’s career in the air force resulted in a cross-country move to Florida, Heather’s business was threatened.

Heather did not even think to ask the state of Florida for permission to continue operating her business after she had relocated. Since there were no excessive regulatory obstacles in California, she had no reason to assume there were any elsewhere. She also didn’t think twice about calling herself a nutritionist. That was her profession.

Unfortunately, the state of Florida was not so understanding. In May of 2017, Heather received a cease-and-desist letter from the Florida Department of Health. The letter stated that she was being fined $754 by the Department of Health and demanded that she stop conducting all business related to Constitutional Nutrition immediately. Part of the state’s complaint dealt with her advertising herself as a “nutritionist.” In Florida, you are only allowed to label yourself as such after you have satisfied all the state requirements. 

Heather and her husband were shocked, to say the least. They did not even know this law existed in Florida, yet they were being slapped with a sizeable fine. But even worse, the state was revoking Heather’s right to provide for herself.

In order for Heather to reopen her business, she would have to spend thousands of dollars and several additional years in school. This is the only way she can legally obtain a “license to give nutritional advice” in the state of Florida.

But Heather has already proven herself more than capable in her field. This is evidenced by her consumer base. She was able to build a profitable career and provide a service to many willing consumers. Since being forced to close down, Heather has had to turn away clients eager to exchange money for her services. 

And even though her business was completely legal in one state, Heather is now left fighting for her right to earn a living in court. Joining with Institute for Justice, Heather is taking on the Florida Health Department. But sadly, her case is not unique.

With over 30 percent of the workforce heavily regulated by occupational licensing, many individuals lose their right be entrepreneurs. And in many cases, these licenses and their corresponding regulations are created by those already in a given field. In fact, many of those responsible for crafting these policies are members of trade unions directly impacted by these licensing procedures.

Many of these regulations are adopted in the name of public safety or protecting the consumer. But that is hardly the case. These licenses act instead as barriers to entry by restricting the number of professionals vying for consumers in a given sector. In other words, it restricts true competition.

In order for entrepreneurs to have the freedom to innovate and create value in the marketplace, we need less government regulation. Hopefully, the courts will understand this, and side in favor of Heather Kokesch Del Castillo, so that she may continue earning a living.

Write for CFI