Regulate For Public Safety, Not Otherwise

Here’s a righteous rant from Alan Durning at Sightlines about the dreaded occupational licensing problem.

What’s more, even though he says “reasonable people can disagree about exactly where to draw the line” between occupations that need licenses and those that don’t, I think he actually spells out the criterion correctly. “We want to make sure, for example, that midwives, bridge engineers, and pesticide applicators know what they’re doing,” he writes, because “Any of them can cause lasting, far-reaching harm.”

There’s the rub. If there’s some kind of public safety concern, it makes sense to regulate. But if you’re just really bad at cutting hair, there’s no reason to think that you’ll do irrevocable harm. The other point I would add has to do with whether we think there’s reason to worry that people will cut corners. Banks need to be regulated, because shady practices can be a very sound business proposition. But if you owned a barbershop, you wouldn’t go around deliberately hiring inept barbers. An interior decorator is only going to make money if her clients like her work. By contrast, again, a factory really will eagerly cheat on pollution rules if you let it.