Regulation

Business Licensing Makes It Too Easy for Politicians To Punish People They Don't Like

Making a living is a right, not a privilege, and should be respected as such.

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Incensed by scenes of people celebrating the end (official or otherwise) of coronavirus lockdowns, New York Gov. Andrew Cuomo recently threatened to strip bars and restaurants of their licenses if they don't enforce social-distancing rules. There was no hint of due process in his message, just the prospect of establishments that allegedly break rules losing government-issued permission to do business—and another stark reminder that requiring people to get licenses turns making a living from a right into a privilege and puts people under the thumb of the state.

The governor's threat to deprive people of permission to make a living was explicit. "Now we're getting reports from all across the state that there are large gatherings, social distancing is being violated, people are not wearing masks. We have gotten 25,000 complaints to the State of businesses that are in violation of the reopening plan25,000 complaints," Cuomo snarled earlier this week. "A bar or restaurant that is violating these rules can lose their liquor license. State Liquor Authority inspectors are out. We have a task force of State investigators who are out. You can lose your liquor license and that is a big deal for a bar or restaurant."

In what was a typical Cuomo tantrum, the governor also threatened people drinking in public and unmasked protesters with fines "for open container and social distancing violations." In those cases, though, he has to settle for using the criminal justice system and its (admittedly limited) safeguards to impose defined penalties on people whose identities the authorities may never learn. But loss of a liquor license, as he admits, "is a big deal for a bar or restaurant"it's an arbitrarily imposed death sentence that can end the existence of any establishment that offends a thin-skinned state official.

That ability to extort compliance from business owners with a minimum of muss and fuss was the whole idea of licensing from the beginning, and especially of liquor licensing. After Prohibition, with the country still divided between wets and dries, governments turned the selling of alcohol into a privilege that could be revoked by the powers-that-be.

"When repeal comes, the 21st amendment gives states the authority to control alcoholic sales and consumption. Each state is issuing licenses," Daniel Okrent, the author of Last Call: the Rise and Fall of Prohibition, noted in an interview with Bloomberg. After that, states started instituting rules like "you have to be 21, and you can't serve this, you can't serve something over such-and-such proof, and you can't do it on a Sunday. You have to close it at midnight. The bar owners now had licenses that they could lose, and to protect themselves and their business they had to abide by these rules."

As you might expect, the arm-twisting character of licensing lends itself to unofficial abuse.

"Clark County Business License registers businesses to ensure public health and safety while generating essential revenue," boasts an interesting online history of local business licensing published by Clark County, Nevada. The history then notes that Business License Department Director "Tex Gates was suspended from his duties by newly elected Sheriff John McCarthy and eventually resigned from his post on January 5, 1979, as a result of federal grand jury indictments related to the extortion of business license fees." Obviously, Gates was very enthusiastic about "generating essential revenue," andwho knows?maybe he enhanced his own health and safety in the process.

But the arm-twisting character of licensing also lends itself to official abuse.

"1961: January, women banned from bartending by Liquor and Gaming Licensing Board, the ban was repealed in 1965," adds the Clark County licensing history. "1998: April, applicants for new business licenses required to comply with Child Support laws."

What does a person's sex or compliance with child-support obligations have to do with the ability to mix drinks and operate private enterprises? Nothing at all, of course. In fact, being forbidden to open a business may make it impossible to meet any financial obligations.

But denial of government permission to make a living is a powerful way to enforce officeholders' prejudices, even those that fade away and become embarrassing in short order. Such arguments have been raisedfrequently – with regard to occupational licensing. They apply just as readily to the broader realm of business licensing.

Licensing, then, is about power and control. It can be used to extort compliance with the whims of government officials, whether that amounts to private gain, public purposes of the moment, oras with the governor of New Yorksatisfying the petulance of an officeholder who can't abide being contradicted or defied.

And for those who submit to the humiliation of asking government for permission to operate, staying in compliance is always a moving target, subject to the likelihood that there's something you missed. The licensing page for Washington state's Department of Revenue, for example, includes a host of sections and subsections regarding basic licensing, endorsements from different jurisdictions, trade names, hiring employees, specific activities, and more.

There's a reason why license requirements are included among the factors that researchers say drive people to work off the books. It can be much easier and cheaper to ignore the rules and paperwork. That's exactly what I did when I ran a house-painting and home-repair business in Boston, many years ago, and realized what a hassle it would be to do things legally.

And why should government officials be able to exercise such power and control? If they believe people are violating rules (whether wise rules or the ever-expanding web of stupid ones), let them prove their point in front of courts that might or might not uphold the charges. Does that sound more difficult? Good.

It should never be easy to deprive people of their liberty or their means of making a living.

But government officials want to be able to punish people without jumping through hoops or risking push-back. They like a permission society, in which offending the powerful can result in the revocation of grants of privilege without formality or delay. A system of privileges rather than rights puts everybody at risk of officials' pleasures, if it doesn't drive them underground.

That's good enough reason to get rid of licensing requirements. We should strip Cuomo and other politicians of their ability to deprive people who offend them of the means to make a living, and make officials enforce any rules they impose the hard way: with due process and the potential for losing.

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  1. What might happen is that the next set of peaceful protests may revolve around business patrons continuing to patronize establishment with a license.

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  2. I hate this site:
    patronize establishments without a license . . . .

    (really, I did proofread it, twice. I think my coffee is defective, it can’t be me)

    1. Your SO secretly switched you to decaff?

  3. 25,000 complaints

    Hopefully the sources of these complaints with detailed contact information was recorded in a database that gets leaked somehow. Nobody likes a narc.

    1. 25,000 just about covers the number of people ignoring social distancing for the George Floyd protests in NYC

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    2. That number (if true). That’s what the state of New York has come to. Too many people enjoy that power.

      1. So at 100 per woodchipper, how many do we need?

  4. OT: Fulton County DA is charging Officer Rolfe with Aggravated Assault and Felony Murder. The other officer is going to be testifying against Rolfe. No idea if they bothered getting an indictment, or just charged the officers without one. https://abc13.com/officer-who-fatally-shot-rayshard-brooks-charged-with-felony-murder/6252206/

    1. Felony murder is going to be a tough sell.
      I wonder if it just to quiet the mobs in hope they will forget by the time the acquittal is handed down.

      1. He’s going to end up burning his town down. Which might be the point. This doesn’t even meet muster for a wrongful death civil suit, and this idiot thinks he’s getting a felony murder case out of it? I guess it’s true that any prosecutor can convict a crook, but it takes a really talented one to convict someone who didn’t commit a crime.

        Who can say what a jury will do? I’m really curious to see if the Grand Jury agrees this is felony murder, or whether the DA is traipsing the familiar path laid by luminaries like Angela Correy, and is just charging the defendant without an indictment.

        If I were a Atlanta or Fulton county area cop, I’d resign today. The cops who stay after something like this, aren’t going to be cops you want around. The public gets what the public wants, but will the public want what they end up getting?

        1. I suspect these charges will drag on until around the first of November, and then be dropped or a jury will find for the defendant. Nothing like riots right before the election to get out the vote.

          1. Ah, but which vote? I have a funny feeling that the people who are thinking “if we encourage people to burn down cities, we’ll guarantee victory” are probably going to be surprised by the result.

        2. Shooting a person in the back while he is running away? Which police do over and over again and you think it is OK execute a person who is running away for a petty violation?
          The guy asked to be let go to walk home. In the old days the cops no only let you walk home, they would sometimes give you a ride home. Police are being trained by idiots who tell them they are at war with the people instead of telling them you are simply making a traffic stop. Police have come unhinged.
          50 to 60 police are killed on the job annually. On average, the police kill about 1200 people a year. More farmers die on the job than police. Farming is a more dangerous job than being a policeman. A farmer gives you life sustaining food, while a policeman will most often give you a traffic ticket or if you are black, shoot you in the back. Police union are so rotten, they protect sadistic, demented, racist bullies who hide behind a gun and badge while exercising their cowardly, sadistic brutality on innocent citizens. All you have to do is go on youtube and you will find many examples of police violence. Even with video evidence, the police union, the DA and judge who are in the same league as the cops, will tell you what you see on the video is not what is happening. In other words, they will tell you it is raining, while they are pissing on your foot.

  5. >>”1961: January, women banned from bartending

    shoulda stayed a thing.

  6. Um. That’s the whole fucking point.

  7. “But the arm-twisting character of licensing.”

    You don’t own any ‘you’ rights. Your rights are owned by the [WE] foundation who will use the “friendly” term coercion. Too bad the dictionary still paints the word pretty bad; “the act of coercing; use of force or intimidation to obtain compliance.”

    Maybe the very idea of pre-emptively protecting people from themselves and their own faulty decisions isn’t such a grand idea. Maybe we should stick to ‘your’ rights also may have consequences like citing known contagious patients who willfully neglect responsibility to distance themselves from others.

  8. Am I missing some detail? How could a bar violate open container laws? Is the drink supposed to teleport itself?

  9. How exactly does Cuomo intend to enforce these open container/social distancing laws when he is also defunding the police?

  10. Let’s start with why you need to go to college, get a 4 year degree, get accepted to Law School, and then take the Bar Exam to become a lawyer. If there is a test to ensure you know what you are doing, then I am little confused why you can’t just show up, take the test, and if you pass get your license to practice law. This business licensing is at the top of the heap. Fix that one then move your way done.

  11. “It can be much easier and cheaper to ignore the rules and paperwork. That’s exactly what I did when I ran a house-painting and home-repair business in Boston, many years ago, and realized what a hassle it would be to do things legally.”

    That’s nothing more than Harry Brownian “Living Free in an Unfree World.” I favor this.

    “What do you do for a living?”
    “I am criminal.”

  12. Gaming should never be inhibited by any politician and Gaming Licensing needs stricter rules. Gamers and Gaming companies should be free from such revenge-seeking politicians that want to get back at an executive they do not like or punish a gaming company that takes a stand against a politician.

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