Stossel: Stop! You Need a License To Do that Job!

"Bottleneckers" use occupational licensing to screw competitors and innovation in the name of keeping us safe.

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Whether you're a doctor, an electrician, a teacher, a cab driver, a hair stylist—even a tour guide!—the government increasingly demands that you get a license before you are allowed to work in your chosen profession. In the 1950s, only about one in 20 workers needed the government's blessing to do their jobs. Today, that figure is more than one in three.

Because of safety issues and concerns about accountability, many people think occupational licensing is a good idea. Yet licensing doesn't prevent fraud and incompetence (in some cases, it even provides protection from such claims). And all over America, people want to work but can't because it's often nearly impossible or too expensive to get the proper government permission.

In their book Bottleneckers: Gaming the Government for Power and Private Profit, the Institute for Justice's William "Chip" Mellor and Dick Carpenter document how established companies use government regulation, especially occupational licensing, to block newcomers and innovation. A "bottlenecker," they write, is "anyone who uses government power to limit competition and thereby reap monopoly profits and other benefits."

In the first of a video series, John Stossel introduces the concept of bottleneckers and shows how they hurt the economy in the name of keeping us safe.

Produced by Naomi Brockwell. Edited by Joshua Swain.

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  1. With a delivery like this, I’d say Madison has a good shot at being the next Stossel.

    1. or streusel…I like streusel better…

  2. It defies common sense to allow somebody who hasn’t demonstrated competency or expertise to install a transformer, design a bridge, or perform surgery on your child.

    I just don’t get the libertarian fixation on allowing any Tom, Dick, or Harry to simply claim that they’re a bridge engineer, or a high voltage electrician.

    1. Reason hasn’t, that I’ve noticed, suggested that we allow any clown who comes rolling down the pike claim to be a member of a highly technical profession. What I HAVE seen them to is call out a State licensing board for denying a man with a degree in engineering from a reputable school describe himself as an engineer.

      I have also seen then assert, with a good deal of reason, that licensing boards for interior decoration, hairdressing, coffin salesmen, and so on are almost certainly more about restricting competition than about safety.

      Unless Larry Correia is right, and his Monster Hunter books are non-fiction, in which case coffin salesmen probably DO need highly technical – and secret – training in the new anti-zombie features….

      1. That’s the key point. You can graduate with an engineering degree from a reputable school, but that does not qualify you to be the same thing as a professional engineer. Just like graduating from med school does not somehow magically make you into a brain surgeon. Or graduating from law school make you into a lawyer.

        1. But getting a piece of paper from some rando bureaucrat does make you a brain surgeon, lawyer or engineer?

          Incidentally, it’s been my experience that people who toss around the phrase “common sense” do so because it’s the only defense they have for their ideas.

          1. Residency/experience, board exams, and demonstration of proficiency to the state’s board of medical examiners, bar, or professional engineers make you a board certified surgeon, or lawyer, or engineer. Not some rando bureaucrat handing out a piece of paper on a whim.

            1. The problem is you assume this bureaucrat is some kind of saint who couldn’t possibly be wrong, or block people he doesn’t like, or let those with power over him slide, etc. Not everyone worships the state and thinks that some unaccountable guy in a government basement is a paragon of virtue and judgement.

        2. If you think the bar exam accurately measures a person’s ability to practice law, then you clearly aren’t an attorney. At any rate, no one is saying anyone should be allowed to do anything. Rather, it’s about how laws of this nature are used to prevent competition. For instance, there was a town in Oregon some years back where, under the guise of “protecting pets”, it was illegal for anyone other than a vet to flea dip a pet. This wasn’t really about protecting pets, it was protecting vet’s incomes. Physicians have opposed allowed nurse practitioners to be able to handle simpler medical issues by claiming it isn’t safe to do so, despite the fact nurse practitioners do the same thing when working for a doctor. Similar things can be found in other professions.

        3. Licensure does not, either, “somehow magically make you into a brain surgeon”. Nor does it ensure even a bare degree of competency. Really, you entire perspective on the matter is question-begging.

          Consider my field: I’m an unlicensed electrical engineer (I do work in the field). I routinely encounter licensed electricians who, while they may have been nominally taught correctly pursuant to licensure, in practice operate based on the received “wisdom” of whatever old timer they learned from. I have on numerous occasions corrected these and other tradesmen on incorrect understanding or bad practice, and more often than not they proceed right on as before, because after all they are the “licensed” professional.

          The longer I’ve lived, the more convinced I’ve become that licensure is, at best, the equivalent of “security theater” (i.e. it exists primarily to give the impression of “doing something”), and at worst is an overt protectionist barrier to entry.

        4. Few people will argue that some professions are best regulated this way (although the tests are doubtless designed so that many competent people will fail). I doubt anyone can adequately explain why a hair braider or a dog walker needs hundreds of hours of classroom time and a license.

    2. What the holy fucking fuck is wrong with your brain?

      There’s a difference between “allow” and “demand”. No one requires hiring the first goofball who shows up; you are free to vet yoru bridge engineer any way you want, with a PhD from Caltech if you want, or a napkin signed by bozo the clown if you want. If you think newspapers wouldn’t sniff out bozo, you’re pretty bozo yourself. If you think investors couldn’t distinguish the two, you’re off your rocker.

      Or maybe you think people just open their mailbox and pull out an IKEA bridge flat pack and start assembling it across the Grand Canyon.

      Where the fuck do you get such common sense ideas as “allow” = “mandate”? What a fucking loser.

      Fuck off, slaver.

      1. The above reply is exactly what I don’t understand. This guy defends the idea that licensing is a misguided practice by saying it should be wholly left to the consumer to do the work of what rigorous training and state competency exams do: weed out the liars and incompetents. That is a world without any basic, uniformly applied, minimum standard of competency or professional care. Sorry if it drives you batty, but that idea is not my bag.

        1. You are even more of a fucking idiot if you think government bureaucrats know squat about what makes a good engineer. Are you one of those fuckheads who thinks a government paychecks transforms an illiterate peasant into a know-all god with pleasant manners and third sight?

          Ooo, this bridge is safe because some peasant with a government paycheck certified the engineer who built it!

          Is that how you get through life, monkey brains? How do you think anything was accomplished before government paychecks began transforming peasants into wise men? All those ships and railroads built before government certification — how the hell did we survive such disasters?

          Krist what an ignorant self-deceived willingly-blind slaver.

          1. Well look who doesn’t know a thing about an engineering board. I should have known straight away by all the childish insults. You are quite wrong, my friend, if you think government bureaucrats populate a state’s board of professional engineers. They are all active PE’s, with real jobs as professional engineers in the private sector, who serve limited terms, not lifetime employment, and don’t get paid a salary.

            1. I ain’t your friend, pal.

              You are doubly a fool if you think those government bureaucrats are fine professional engineers just because they’ve been certified by previous members of the same boards they now inhabit. Can you spell circle, jerk?

              1. Becoming a licensed professional engineer has a lot more checks and balances then you seem to believe even though it’s run by “The state”.

                You must graduate from an accredited university with an accredited engineering program specific to the technical discipline. Then you must pass EIT/FE exam, demonstrate four-six years of work experience under other licensed PE’s to be even allowed to sit for the test. Then the test itself has a low passing percentage because it is truly difficult. Then once you have your PE (which also means you can now be held criminally and civilly liable for any work done under you license) you have to undergo continuing education every year to stay current in the field. And even better anyone can bring any issues of competency or malfeasance to the board for your state which will bring an inquiry which can remove your license.

                Or it is a just burecratic circle jerk according to your esteemed opinion

              2. It’s all a vast conspiracy against you, isn’t it.

                One more time: the engineers on a state board are not state employees. They are not bureaucrats, they don’t draw a salary. They have day jobs. And they are fine professional engineers because they went through the development process: education, engineer-in-training, engineer-in-training exam, working under another PE for 5+ years, and then passing the PE exam. And then they keep their licenses through annual continuing education requirements and maintaining a complaint-free history.

                So again, I don’t understand folks who want to chuck that all out the window, and live in ‘buyer beware, but even if you’re being careful, this guy could still be lying his butt off to you’ society.

                1. No, what you don’t understand is people. People don’t go around pretending to be bridge engineers or brain surgeons. People don’t hire any nut who claims to be a bridge engineer or brain surgeon. People are pretty damned smart for things that they care about, and there is nothing — NOTHING — a government does that people can’t do on their own.

                  Why do you think that people are so ignorant, naive, and stupid? How do you think roads, bridges, dams, ships, canals, and all sorts of things got built before there were government boards to certify engineers and brain surgeons?

                  That’s what makes you so dumb. You simply cannot grasp the concept that most people do a fine job taking care of themselves. You have an incredibly low opinion of normal people. That’s what makes you a statist, a progressive, because you think you are one of the few elites who are capable of running other people’s lives.

                  What a burden you live under. I almost feel sorry for you, except you and your kind are the damn fools that foist government on everybody else and cripple society and the economy.

                  1. “How do you think roads, bridges, dams, ships, canals, and all sorts of things got built before there were government boards to certify engineers and brain surgeons?”

                    That’s easy. A system of apprenticeships, master masons, master shipwrights, and professional or trade guilds.

                    As for the rest of your rant, be careful, your low self esteem is showing.

                    1. That’s easy. A system of apprenticeships, master masons, master shipwrights, and professional or trade guilds.

                      Riiiiight. Because all that was in place before any roads, bridges, dams, or other infrastructure were built. Riiiight.

                      As for self-esteem, that’s irrelevant. What counts is esteem for others, of which you have none because you think you are better than everybody else and better qualified to run their lives than they are. Whereas I have plenty of esteem for my fellow humans and think them better qualified to run their lives than I am.

        2. You’re also an idiot if you think the woods are just crawling with backwoods mental midgets who want nothing more than parade around town as bridge engineers and brain surgeons. You think brain cancer victims ask every homeless “vet” on a corner if he’s an off-duty brain surgeon looking to pick up money for bowling during his break? There’s a reason people go to hospitals first, or talk to big engineering companies to build bridges. Do you ever look at any wall certificates when you go to the dentist or doctor? Do you demand the bona fides of the engineer or construction who designed, built, and maintain every bridge you cross or building you enter?

          Left to the consumer?!? Why you two tone dick, you must have come out the wrong hole if you think consumers deal with bridge engineers or brain surgeons. The only bridge “consumers” buy is the slide that comes with a wading pool.

          You haven;t got the brains you were born with. What’d you do, trade them for a bridge design by a guy with egg custard in his hair? Maybe you ought to crawl back into that government womb you want everyone else surrounded by.

          1. You know why they go to hospitals and big engineering firms? Professional standards of practice. And you’re darned tootin’ I look at everyone’s license certificates of anyone I need to do business with.

            Also, you probably don’t live in a part of the country where private bridges and dams exist, so I’ll let that slide.

            Lastly, be careful, you’re blatantly hiding behind epithets and insult slinging, which is pretty sad.

            1. You can be a professor of chemistry, teaching college-level or post-grad chemistry, for 20 or 30 years…

              Then want to “step down” and teach High School chemistry as you approach retirement, or, “just because”, or, you want a change of pace…

              BUT YOU HAVE TO GET A “TEACHER’S DEGREE” FIRST!!!

              Can you justify that? How?

              1. Cuz they been certified, man. Can’t you get his drift? God he’s so awesome smart.

              2. Actually in my state that scenario doesn’t exist. If I was a professional whatever, and wanted to teach in high school in my field later in my career (math, science, etc), I don’t need a teaching degree to do it. In fact, I can get a teaching certificate and start working as a teacher in less than 4 weeks. But you need to demonstrate your proficiency.

            2. You know why they go to hospitals and big engineering firms? Professional standards of practice.

              Professional standards of practice is not the same thing as licensure, nitwit.

              The majority of EEs are unlicensed, and yet I work for a company which supplies high-reliability components to military and aerospace customers. How could they _possibly_ establish “professional standards of practice” without any of us having pointless licenses? Oh yeah, because licensed are irrelevant, and our engineering speaks for itself.

              1. licenses* are irrelevant

              2. I am in the sandwich business, myself… And… Beef tongue is an EXCELLENT choice, ya know…

                “Our Tongue Sandwiches Speak For Themselves”!!!!

            3. Christ, what assholes you guys are being. While I don’t condone stupid fucking handles that include things
              Iike “commonsense” (seriously, that is so fucking stupid), this commenter is not wrong. PE “licensing” is not a bad thing in that, generally, it is a privately established process. And the standards are high. If I was presented with following the advice of a PE and a engineer without a PE I would probably opt for the PE. It’s not run by government, it’s not run by “bureaucrats”, and it’s not a cronyist system (not yet, anyway). I would like to see competing “PE” certifications, however, but maybe that will happen if/when corruption sets in to the current system…anyway, stop being such close minded asshats. That is all.

        3. CS, I have a PE. The licensing exam was little more than a joke. Yes it was difficult, but only because I was 7 years out of school. It was notably easier than any of my college finals. After taking it, I am no more qualified than any of the many engineers who never got their license (which is actually a good chunk of them, as most engineering jobs don’t actually require a stamp).

      2. Employers wouldn’t hire anyone without a PE to design a bridge, even if it were not a legal requirement. The legal liability would be too great.

        1. If you had a guy with a civil engineering degree and a decade of experience, they would.
          That’s really all that a PE tells you. That they have seven years of experience, a college engineering degree, and could pass a test that (in retrospect) wasn’t all that difficult.

    3. I notice that in every one of your comments you only talk about engineers, surgeons, and lawyers. You still have yet to address our complaints about licensing requirements on hairdressers, florists, and interior decorators. How many lives do you think have been lost in tragic throw pillow disasters? Do you really think that private consumer guides are just incapable of doing for profit what some couldn’t-hack-it-in-the-real-world bureaucrats do for a government check? Well, I guess I see your point. Private businesses can’t use the threat of violence to force people out of business. I suppose I’m just a cynical asshole for thinking that government might misuse that power and prevent innocent, hardworking people from lifting themselves out of poverty.

      1. You seem to be ignoring the fact that there are no such ‘couldn’t hack it in the real world’ bureaucrats staffing these licensing boards. In my state, board members are all active professionals with day jobs. They don’t even get a salary from the state for the work they do overseeing the licensing process. To your questions:

        1. “You still have yet to address our complaints about licensing requirements on hairdressers, florists, and interior decorators.” ANS: Why do I need to address your complaints. The licensing system is in place, and I like it. I initially said I didn’t get the fixation with allowing anybody to hang a shingle by their door and call themselves (fill-in-the-blank occupation). Nobody here has changed my mind.

        2. “How many lives do you think have been lost in tragic throw pillow disasters?” ANS: good one, but I have no idea.

        3. “Do you really think that private consumer guides are just incapable of doing for profit what some couldn’t-hack-it-in-the-real-world bureaucrats do for a government check?” ANS: A consumer guide is not going to let the consumer know definitively if the individual doing work for you has met basic standards of practice, if he is in good professional standing within his industry, if he’s been working complaint free, and if he’s staying sharp.

        1. 4. “Well, I guess I see your point. Private businesses can’t use the threat of violence to force people out of business. I suppose I’m just a cynical asshole for thinking that government might misuse that power and prevent innocent, hardworking people from lifting themselves out of poverty.” ANS: Again, it’s not government sitting on these licensing boards. These are the applicant’s or licensee’s peers. And, at least in my state, there’s a director-level watchdog, and two members of the public on every board and at every meeting making sure no funny business is happening.

          1. So it is the government. The government enforces the decisions of the licensing board. How is that not the government doing it?

    4. You’re right, it does defy common sense, so why are government beurocrats the ones measuring this competency or proficiency?

      You don’t seem to understand the libertarian position. Wouldn’t it be better if there were engineers judging engineers? Our position is that government control is what’s bad, not that there shouldn’t be controls in the industry

      1. Government bureaucrats are not the ones measuring this competency. The boards are staffed by real professionals with active employment in their fields. They are volunteers, receiving no salary. So in fact, engineers are judging engineers.

        1. I should have read way more before I asked whether this is sarcasm or stupidity.
          Stupidity, plain and simple.
          Hint: France didn’t kill any Jews in WWII. They shipped them to Germany and let them do it.
          Screw you and your ‘they’re not government employees!’ bullshit. They are a government agency just the same as the firing squad was.
          As regards your pathetic claims that we are incapable of hiring qualified help, I can only point out that most everyone here spotted an incompetent commenter almost immediately: You.
          Did anyone else yet tell you to fuck off, slaver? If not, please allow me to be the first.
          Fuck off, slaver.

    5. You say, “It defies common sense to allow somebody who hasn’t demonstrated competency or expertise to install a transformer, design a bridge, or perform surgery on your child.”

      So…. If NO-ONE is “allowed” to demonstrate “competency” without first demonstrating “competency”… THE HOW IN THE H*LL is anyone gonna demonstrate anything?????????? You seem to developed a catch-21 system there were NO-ONE is “allowed” to do ANYTHING…. So what now — Just sit at home and collect poverty “benefits?”

      Sorry, there is a little risk involved in allowing anyone to prove “competency” and if business owners cannot determine what risks their business will make properly – they have no right or REASON to be in business. The government just road-blocks that process for your business; which just makes it harder for the business owner to RUN their own business. They end up running the governments business.

      1. Yes… Some ancient humanoid or semi-humanoid, somewhere, was the first to “perform surgery on your child”.

        (Maybe a monkey popping a zit on another monkey… Put up a sign in your yard, “Zits popped here; $5 a crack”, and see how fast the local dermatologists’s board shuts ye down!!!)

        So… First creature to pop a zit, for a banana in return… Or pick any other profession… WHO in the FUCKING HELL gave THEM a degree, and WHERE did it come from; WHAT were the qualifications of the degree-givers?!?!?

        Oh, ya mean it fell out of the clear blue sky?!?!? Then WHY NOT FOR ME!?!??!

      2. In my world, anyone can become a licensed professional if they demonstrate they have a degree in their field, had good grades, worked an apprenticeship under another licensed professional, then passed a licensing exam, and then maintained their license through continuing education and no board actions against them (ie, no complaints).

        1. You officially forfeit your right to ever complain that anything is too expensive.

          Reducing the burden of occupational licensing is so broadly supported even Hillary Clinton supports it (nominally). That’s a special degree of receptiveness to bad ideas you’ve demonstrated.

    6. Or a florist? You do know that florists are licensed in the state of Louisiana. Surely, you must believe that an incompetent florist will put you at risk (arrangements containing poison ivy, perhaps?) Or teaching??? Really???? Those teachers’ licenses don’t prevent a pervert from being hired, they sure don’t guarantee that a kid receives a quality education, and they don’t reflect the expertise of the person holding the license with regard to their subject matter OR their teaching ability.

      Licensing serves a purpose when it is associated with a profession in which poor performance may cause harm or death. But all too often, licensing serves as a “soft” tax and a means by which to legally discriminate against a particular race, gender or in today’s environment, political ideology.

      1. Only a handful of professions should require any type of licensing.

      2. Don’t forget taxi licensing. The Taxi medallion system is so notably ineffective and corrupt that two companies (Lyft and Uber) have made international multi-billion dollar markets for themselves by openly defying the law in every city on two continents.

        And Taxis are one of the licenses that are actually easier to defend, given that they have actual safety standards.

    7. Others have already pointed out that consumers don’t have to accept just anyone who claims to be an expert do work for them. You don’t understand how consumers can ‘vet’ potential experts or why they should have to go to that much effort.
      First of all, it’s relative. The more important the job, the more important it is to vet the worker. Second, the market provides solutions for consumers who don’t want to work that hard at it. It’s called certification, and the best part of it is that it doesn’t restrict competition like licensing does.

    8. CommonSense457|8.1.17 @ 1:35PM|#
      “It defies common sense to allow somebody who hasn’t demonstrated competency or expertise to install a transformer, design a bridge, or perform surgery on your child.
      I just don’t get the libertarian fixation on allowing any Tom, Dick, or Harry to simply claim that they’re a bridge engineer, or a high voltage electrician.”

      Sarc or stupidity?

    9. Watch the video, CommonSense457. It’s a question of compulsion. If a consumer wants to employ an unlicensed, unbonded, or noncertified practitioner, it’s his own decision. He takes whatever risks he decides to take. Nothing in libertarian philosophy prevents the provider from being held responsible (via tort law not statutory law) for any losses or damages caused by his negligence. Mandatory licensing limits the supply of practitioners, increasing the cost of the product or service in question. Demand ? supply = price.

  3. at least in your case you have amply demonstrated that you’re a professional douchebag…here’s your participation certificate…

  4. Confession time. I’m an unlicensed commenter…

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    1. Unlicensed spammer…

  6. In the 1980’s, I started fixing TV’s in my home in New Orleans. After I got a good start and liked it, I decided to rent a storefront and become an official TV Man! The state govt. told me to pay several hundred dollars, take a course, and wait 4 months for my “license” so I instead drove 40 minutes away to the beach town of Waveland, MS. The city-hall there told me to fill out this page, pay a $10 fee, and then gave me a license.
    Guess where we ended up living for the next 2 decades…..and we loved it there!

    1. But… but… but how many people were killed by your badly-repaired TVs blowing up!?!?

      Also, just HOW many degreed-licensed – and-credentialed (and board certified) TV repair humanoids, did you deprive of an extra dollar or two?!? HUNH?!?!? Don’t you feel GUILTY and DIRTY?!?!

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    1. Was the hacker licensed? If not CommonSense has some words for you.

  8. We can see that we don’t need the government control. Just look at all the jobs that could be done by a high school graduate, yet employers require a college degree.

  9. @CommonSense

    Any market regulatory system will have competitors, reducing corruption, while at the same time lacking the ability to actually prevent people from seeking work, thus eliminating the possibility of regulatory capture.

    Any statist regulatory system will both lack competition, enabling incompetence, and furthermore have monopolist power to exclude actors from that market sector unless they pay off the regulators (rent-seeking).

    Oh, and those “watch-dogs” and “members of the public” on the review board, there to “make sure no funny business” is going on?

    Yeah, they’re being paid too. Or, are too lazy to pay attention when the ones who are being paid start sweet-talking them.

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  11. Whats frustrating is how the costs of licensing, however nominally unseen, are actually pretty obvious. Especially now the internet can aggregate customer reviews of shit any excuse for licensing that might have been valid last millennium got obsolesced, ironically, by al gore.

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