License to License

Second City swindle

Want to help someone get a license to cut hair or open a business in Chicago? First you'll need a license. Since 2009 the City of Big Shoulders has required a license for anyone who wants to help people obtain licenses by working as an "expediter" within the city's vast and famously corrupt bureaucracy.

"An expediter is a person who, for compensation, seeks to obtain licenses, permits and certificates for another person," Chicago's Department of Business Affairs & Consumer Protection explains. "Expediters work on the behalf of developers, contractors, businesses and homeowners in obtaining permits, licenses and certificates. An expediter also monitors the progress of applications through any stage of the application review process or inquires as to the status of an application within any City department. An expediter may also pick up a license or permit application or certificate from any City department." 

Nationwide, Reason Foundation analyst Adam Summers estimated in 2008, occupational licensing imposes costs of $35 billion to $42 billion per year (in 2000 dollars). He also found that licensing requirements reduce competition, thus reducing the annual rate of job growth by an average of 20 percent. 

Although the expediter's license requirement raises questions about freedom of trade and the First Amendment right to petition government for a redress of grievances, it has so far escaped legal challenge in Chicago, where the unemployment rate as of July was 9.9 percent.