Lawmakers in Mississippi this week passed the nation's most significant occupational licensing reforms.
The bill, which is expected to be signed by Gov. Phil Bryant early next month, would require that any new regulations created by Mississippi's licensing boards be approved by a majority of three executive branch officials: the governor, the state attorney general, and the secretary of state.
After years of fighting against onerous occupational licensing laws in a piecemeal way, reformers see the Mississippi proposal as a major step towards comprehensive change in how licensing boards—often controlled by the very industries they are meant to be regulating and frequently used to limit competition in certain professional fields—operate, writes Eric Boehm:
Over the past 15 years, opponents of occupational licensing have repeatedly challenged both the laws themselves and the boards that write and enforce them.
Many of these legal challenges have been successful, overturning hair braiding licensing requirements or inspiring legislation to eliminate them in Louisiana, Iowa, and Nebraska, for example. Similar efforts have taken down licensing rules for florists, cosmetologists, eyebrow threaders, animal caretakers, landscape architects, interior designers, and tour guides, among other professions, in various states. Part of Tennessee's licensing laws for makeup artists have been successfully overturned in court. Mandatory barber licenses have been challenged in a handful of states, as has Washington, D.C.'s requirement that interior designers and tour guides get a government permission slip before matching a resident's furniture with her carpets or explaining the history of the Jefferson Memorial.
Each of those victories tore down unnecessary and restrictive occupational licensing rules, but most cases only resulted in the defeat of a small part of a state licensing regime, or the creation of a narrow exemption. In the 1960s, about 5 percent of all jobs required permission from the government. Today that number is more like 30 percent. Additional rules are added every year.
The fight against needless occupational licensing laws can feel like an elaborate and expensive game of Whac-A-Mole, where there are always more moles than mallets.
Instead of continuing to play the game, then, what if there were a way to unplug the machine?
Licensing reformers hope the key to that paradigm shift might lie in a U.S. Supreme Court decision that turned 2 years old earlier this year. In that ruling, the high court held that some state licensing boards can be held accountable under federal antitrust laws designed to protect consumers from cartels and monopolies—which is exactly what some licensing boards have become, captured by the very industries they're meant to be regulating.
Armed with that ruling, officials at the Federal Trade Commission (FTC) and state lawmakers are reaching for the plug.