Tuesday, August 28, 2007

Frauds and Nuts

Forbes magazine reports on a new Reason Foundation study that concludes, "The real motivation behind most occupational licensing regulations is one of special interest, not the public interest," the report says. "By banding together and convincing governments to impose new or stricter licensing laws, existing practitioners (who typically are exempted from the new laws through grandfather clauses) can raise the cost of doing business for potential competitors."

Capitalism gets a bad name -- justifiably -- when capitalists use the threat of violence via the political system to limit competition and set prices. Unfortunately, all too many business people think it's a great business plan to do just that. That's why so many businesses spend so much time lobbying government at all levels, local, state and federal. There's gold in those licenses!

That would explain why you need a government license to tell fortunes in Maryland, or a government license to be a tribal rainmaker in Arizona. It's not because customers are clamoring for certifiable skill in these dubious occupations. It's because one group of greedy business people wants to protect cosa nostra, "our thing," by getting the police to do their dirty work.

Of course, such schemes are usually promoted as a civic virtue, as a way of assuring the customer he will get a more reliable product or service. But we're talking about fortune tellers and rainmakers here, not brain surgeons. Do we really need a government license to tell the difference between a fraud and a nut?

Gipsies Fortune-telling.--Fac-simile of a Woodcut in the "Cosmographie Universelle" of Munster: in folio, Basle, 1552.

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