Wonka Fights the Candy Cronies
When regulators block entrepreneurs, they take away a golden ticket.
The box-office hit Wonka is a wild flight of imagination, but within the glamor and fantasy lies a hard truth: The mighty often manipulate government power to shut out competitors, stifling innovation and individual rights. The regulatory barriers manipulated by Willy Wonka's powerful rivals to stymie entrepreneurs are all too real.
In the film's opening scene, Wonka arrives in the big city, scrappy but determined to fulfill his dreams of building a thriving candy business. In song, Wonka echoes the feelings of many who come to our own country in search of opportunity: "In this city, anyone can be successful if they've talent and work hard—or so they say."
But Wonka is soon confronted by the mighty chocolate cartel. When Wonka begins selling his magical chocolates in an open plaza right outside the cartel storefronts, the cartel boss calls the police, who order Wonka to stop selling in the plaza because he's "disrupting the trade of other businesses."
Wonka faces a Catch-22: He can't legally sell chocolate without a shop to sell it from, but he can't mount the capital to lease property unless he can sell chocolate. His friend laments, "You can't get a shop without selling chocolate, and you can't sell chocolate without a shop." He resorts to selling chocolate from a cart and fleeing whenever the cartel calls the police. Wonka wins in the end by exposing the cartel's corruption.
The bubbly spectacle of Wonka can overshadow its more sober message: that regulatory barriers to economic opportunity crush dreams. The corrupt cartel is an old trope, but we often forget that governments enable such cartels through protectionist regulations. Illegal bribes and sabotage—both of which occur in Wonka—are bad enough. But a more insidious evil arises when corrupt businesses can shut down their competitors and amass power with the government's aid. The cartel in Wonka does just that—manipulating laws, such as the requirement that chocolatiers operate out of a store, to ruin Wonka's dream.
Sadly, there are plenty of real-world Willy Wonkas who don't get a Hollywood ending. Ursula Newell-Davis, for instance, is a New Orleans social worker who dreamed of opening a business that would serve special-needs kids who are home alone while their parents work. Louisiana regulates such "respite services," requiring that new businesses prove that another respite provider in a certain area is necessary. This requirement has nothing to do with Newell-Davis' qualifications; it's just a judgment call made by bureaucrats. Those bureaucrats almost always deny new applications. Newell-Davis, represented by Pacific Legal Foundation, recently petitioned the Supreme Court to vindicate her right to earn a living. The Court turned her down.
And laws just like those in Wonka often waylay unsuspecting entrepreneurs. Just as the chocolate cartel shut down Wonka for "disrupting the trade of other businesses," laws sometimes allow incumbent businesses to protest a business' entry into the market. These protest procedures impose unbearable legal costs on entrepreneurs, putting them in the same Catch-22 as Wonka: They need to earn enough money to open their business, but they can't earn the money because they can't open their business. This happened to Parker Noland, who had to withdraw his application to start a garbage-hauling business in Montana because large garbage companies protested his application and he couldn't afford the legal fees to fight them. (Pacific Legal Foundation, where I work, is representing him.)
The food industry that Wonka operated in is also rife with anti-competitive laws. Like Wonka, who couldn't operate near competitor storefronts, entrepreneur Mark Shirley couldn't park his Ole Time Smokehouse food truck anywhere within 100 feet of a restaurant's property line in Farmville, North Carolina, effectively forcing him out of town. The law existed to protect established restaurants, not the public. Thankfully, Farmville repealed its ordinance after Pacific Legal Foundation sued on Mark's behalf. And Wonka himself couldn't sell his hover chocolates made from his magical suitcase in Wisconsin, which prohibits the sale of candy not made in a commercial-grade kitchen. For non magical chocolatiers, this law bars thousands of entrepreneurs from earning a living from their home kitchens.
Such laws have little to do with safety and everything to do with protecting powerful special interests. And since this institutionalized corruption is legal, real-world Willy Wonkas often can't bring down the bad guys. Thankfully, public interest law firms fight in the courts to strike down laws that burden their clients' right to earn a living. But that's an uphill battle, as courts often see the right to earn a living as a second-class right, one that governments can trample if they have a so-called "rational" reason for doing so.
State legislatures have also made strides toward greater economic freedom. A few years ago, Utah passed a "food truck freedom" bill that swept aside protectionist barriers for entrepreneurs like Mark Shirley. Likewise, a number of states have reformed or repealed bans on "home kitchen" businesses. Such reforms, however, often face powerful resistance from industry lobbyists.
Early in the film, Wonka stands in front of an empty storefront dreaming of his future business. A police officer shakes him from his reverie and points to a sign: "No Daydreaming—Penalty $3." While governments in the real world may not be so direct, they often stifle the dreams of fledgling innovators and entrepreneurs across the country. Willy Wonka's magical chocolates are just a fantasy. But the right to earn a living shouldn't be.
