The good news is that I am (mostly) the good guys will eventually win, but not before a lot of people get sick and die.
I should also point out that the industry in which I now work – health and fitness – is by no means the first to experience this. There are undoubtedly people who would like to cut hair – and make a little extra money for themselves and their families – but who can’t because in this country, you need a license from the government to cut someone’s hair. This is not a bad joke. In fact, Doug Stanhope has a great routine on this exact subject that is worth watching.
Think about it for a second. You need permission from the United States Government, or one of its “several states,” in order to cut hair. The immediate question is, from what exactly is the populace being protected… the consequence of… a really bad haircut? So, maybe a bad hair week – or weeks – at worst? There it is, however. You have to pay money to a state “certified” barber or cosmetology school (who, of course, have to pay to become state certified schools and teach only the “proper” haircutting techniques) in order to get a license from the state to actually begin cutting hair. Now, here’s where it’s even more absurd, corrupt, and horrible for everyone: typically, the state boards that are set up to regulate a given field are made up of whom, exactly? Why, members of the industry, of course. This is only mete and natural because what in the flying f$%& does some bureaucrat or politician know about cutting hair? “Nothing” is the correct answer. So, inevitably, some “industry leaders” have to be “deputized,” that is, brought on to this government board to decide what schools should and can teach in order to be considered “safe” to instruct barbers in the incredibly important, complicated, difficult, unknowable hygiene aspects of cutting hair, which, so far as I can tell in all of my years of both attending a barber and cutting hair – (I still occasionally cut my own, or let my daughter, because no barber ever gets it quite the way I like it) – consists of cleaning the blades of the scissors and the clippers, usually with a disinfectant spray or a jar into which one drops the implements. Ta-DAH!!
Now, these experts, do you think they come from smaller, upstart businesses who might be developing new techniques as new technology comes along, or do you think they might be in a more traditional and well-established business? The correct answer is “older, usually larger, usually entrenched” business. And all of this results in what exactly? Less innovation, less consumer choice, more barriers to entry, and it always – ALWAYS – hurts the poor. Always. Both coming and going. The consumer looking for a competitive priced, quality haircut, or maybe even something new, like traditional African hair-braiding, for example – gets screwed. And the small, relatively poor person looking to lift themselves up by practicing a much-needed and always necessary trade? They can’t. (Unless they get lucky and the Institute for Justice takes up their cause, which, God Bless those people, they do on a regular basis).
The depressing fact is that all it takes is some asshole – yes, I used that word – to sometimes invent the public safety threat. It doesn’t even need to be real. And the more I dig in on governmental regulation, the more I find either entrenched industry or a government busybody seeking out some new occupation, activity, or trade to regulate with frequently half-imagined justifications for why it should be regulated.
Lest this seem like hyperventilating nonsense, take the cases that the Institute for Justice has recently won and that it has pending on this exact topic.
Savannah had a law regulating tour guides. Yep, you read that right. It was against the law to give people tours and tell them about Savannah without a f&^%ing license from the government. My favorite part about the repeal of that law by the “town fathers” is the line where “Councilman Van Johnson stated that he was ‘disappointed’ by the proposal to repeal the licensing law but that ‘I also realize that when you come up against the U.S. Constitution, you lose.'”
What a revelation! Please help me in giving Councilman Van Johnson the “You’re a Begrudging Statist Asshole” award! I mean, he’s disappointed that he can’t regulate people who want to give others a tour of Savannah for a few piasters and perhaps make a living, earn a few extra bucks. Of course, what if someone gave people tours and…and…and…gave them wrong information?!? Oh. My. Holy. God. People might think something historically inaccurate about Savannah!!!
This is always where the complete idiocy of these regulations becomes manifest: the moment you actually consider what the harm is that they’re supposed to prevent. I have this vision of some homeless guy, half-baked or half-insane, taking people around in a horse drawn carriage and muttering obscenities about different houses, making up facts about different political figures, calling people slave-owners who worked for abolition, you name it. And I think, we really need laws to prohibit this?? As if it wouldn’t be self-regulating.
I think what secretly burns in the heart of every statist, bureaucrat is the fear that people might actually like that. I for one would pay for the homeless guy to make shit up as we toddled along. Hell, I’d pay extra if he was funny and really creative. I suspect a lot of people would – and the guy might actually make a living. “John Farnsworth’s Fake Savannah Historical Tours: Come learn all the fake history you care to about the Low Country!”
The alternative, the one people don’t like to consider, is that it’s simply corruption. Let me provide another example: teeth whitening. In a recent (and now famous) case, the North Carolina Dental Examiners Board sought to make teeth-whitening services by non-dentists illegal. In fact, they did so – but not because there was any claim anyone was harmed, or because there is any special dental technique that must be mastered in teeth-whitening (there isn’t), but rather to protect the dentists’ monopoly on those services, and thus their ability to charge significantly higher rates for what amounts to something you could do in your home for $19.99 if you were willing to shine a UV light into your own mouth.
The Federal Trade Commission (for a change) took the side of consumers and found the Dentists to be in violation of antitrust laws. The case eventually made its way to the Supreme Court. For a change, the Supreme Court ruled in a way that would serve consumers and in favor of more liberty (although if you read the decision, it’s more about siding with the FTC and still ensuring that sovereign immunity – one of the worst Supreme Court created doctrines of all time – is intact, much more than it is some bellwether of a Supreme Court returning to its original charter – to protect the rights of the citizenry against abuses by the other two branches of government).
George Will wrote a brilliant and telling column about the legal and commercial history of these kinds of cartels – and how they got to be so in the first place. It is under this guise that Progressives and the political left constantly demonize “capitalism” and claim that we need government regulation to prevent those greedy profit-seeking companies from working their sinister wiles on the poor, unsuspecting schlubs known as the American electorate. Nothing in any of these case or actions is even a distant relative of capitalism, of course. They are the very essence of the problems with hyper-regulation and why no government should have these kinds of powers in the first instance. The temptation to use economic regulatory powers for their own benefits is simply too much for politicians – and I lump regulators and bureaucrats in with politicians. Lord Acton’s axiom has reached the status of bromide, not because it’s old, but because it is so true it’s become meaningless to do serious thinking about it: power corrupts, and absolute power corrupts absolutely. But if we spend even a little time reflecting on the truth of that bromide, we might start to think much more seriously about exactly how much power we want to give to unelected bureaucrats who are genuinely hired because of who they know, or because of their former positions in industry.
That revolving door works both ways, too. I got a firsthand look at just how corrupt and evil the FDA is – yes, the Food and Drug Administration – when I was defending servicemembers for refusing the mandatory anthrax vaccination – an order which was ultimately found in federal court to be illegal. I know because I worked behind the scenes on the case. I also had access to internal emails that showed the FDA collaborating right along with the Department of Defense to get that program back up and running as soon as possible. In the subsequent years, the military has refused to correct a single record of anyone who was court-martialed for refusing to take the shots. I know because I handled several of those cases, too. In the midst of all of that, I was amazed – and shocked – to learn how often FDA regulators would leave their government regulator job only to walk into a lucrative job the next day at some company that was subject to FDA regulation – and then they would be talking to their former colleagues, who would be inspecting these same companies. It’s as incestuous and dirty as you can imagine.
The same thing happens at the Department of Defense, as well. I had one friend, a pretty conservative fellow before his tour at the Pentagon, who retired in disgust after three years of working in weapons procurement. He once jokingly told me over lunch: “You know we’ve spent six billion dollars – SIX BILLION DOLLARS! And not a single rivet has been popped. Feasibility studies, surveys, powerpoint presentations…yeah, we’ve got plenty of those!” He just stared at me over his plate. We were actually eating in the Pentagon, so he leaned forward. “With SIX BILLION DOLLARS, me, you, and a couple of friends could have built one of these fucking things, broken it, figured out why it broke, built another, fixed that one, and we’d already be on the Mark Four model – with three billion to fucking spare.”
I didn’t see him for a while and then I caught up with him after his retirement. I thought he would be staying in the DC area, but he moved as far away as he could. “Oh, I got offered the Beltway bandit job, alright. Contractors wanted to hire me for my ‘access’ or I could have come right back into my old job as a contractor at double what I made as an O-5. Fuck this place. I quit.”
I told someone recently that it wasn’t that I wanted to find corruption, incompetence, and cronyism as matter of either disposition or desire: I’m an optimist by nature and I like believing the best about people. It’s just that I only find it every time I look closely enough at something, especially if it involves government regulation. I like average, working stiffs, probably mostly because none of them are ever close enough to power to wield it against their neighbors, but if Homeowners Associations are any indication, you give anyone the opportunity to wield power over their neighbors and they’ll do it…Man, will they do it. Lord Acton was not wrong.
In the realm of regulation, as the Institute for Justice points out, it is crippling our economy.
In addition, states interested in eliminating unnecessary licensing requirements should look for guidance to the laws of other states. While some occupations are licensed in all (or nearly all) states, many others are licensed only in a handful—with no apparent ill effects. A study of 102 low- and middle-income occupations subject to licensing requirements found that only 15 were licensed in 40 states or more. On average, the 102 occupations studied were licensed in just 22 states. Where even one state does not regulate an occupation, other states should seriously consider whether licensing that occupation is truly necessary.
The Institute for Justice, in License to Work, identified 92 occupations licensed by less than 50 states. Every one of these is a candidate to eliminate licensing[.]
The article then lists all 92. Some are mind-boggling. Some are funny. All are tragic because they erect barriers to entry that always and everywhere hurts someone for whom the barrier to entry is simply too high to be surmounted. That burden is never too high for someone who is rich; always, always, always do these barriers hurt the poor.
The same is true for the minimum wage, but I’ll save that for the next part in this series and leave it just to piss people off… Yes, minimum wage laws always hurt the poor, eventually, because you can’t artificially make the value of a dishwasher, or a burger-flipper, suddenly turn from six-dollars an hour to fifteen. Anyone who thinks they can has never owned a small business, nor do they understand that labor is a commodity, just like tomatoes or silver. Okay screw it, I’m already started, so I’ll go off on minimum wage while I’m at it.
Labor has a market value and even government fiat can’t magically make it fifteen dollars if it already has a market price of seven. I’ll offer this as one form of proof: guess who filed for the first exemption from Los Angeles’ new citywide minimum wage law, before it was even passed? The City of Los Angeles’ union, of course. The very same people who agitated for that exact f%^ing law. Now, that’s not proof precisely, but it’s funny how the people advocating for a “living wage” for the entire city’s workforce – the Union – don’t want THEIR employees to have that same “living wage.” Hmmmm….I wonder why that is…?? Actually, I don’t wonder, because I already know the answer. It’s because THEY can’t afford to pay their low-level interns and other temps that kind of money and still stay afloat, but they sure as shit want to impose it on other small businesses. Always, “laws for thee, but not for me.” Yet a large part of the public continues to believe this shit.
Let me try spelling it out in a different way. I love just tooling around the small business administration’s website every now and again. The information available there, for anyone who knows where and for what to search, is a treasure trove. For example, according to the 2011 data, there are a total of 5,684,424 “firms” – that is, businesses, in the United States. Of those 5.68 million firms, how many would it seem likely are “big” businesses? Given my own experience as the 13th employee for a startup that has grown considerably, I’m going to define “big” as a business with more than 500 employees. (CrossFit, Inc. isn’t “big” under that definition, by the way). The answer is less than 18,000. 17,671, to be precise.
So, whenever people have this discussion about minimum wage the first (and always stupidest) words out of their mouth are all about how the corporate bigwigs are getting all of this money, and how can they justify paying their CEO that much, and they should pay more to the workers, on and on into inanity. Why do I ridicule those points? For the exact same reason I ridiculed the regulators and politicians cries for more regulation. It’s always the exceptions that are used to justify a rule that winds up being disproportionately born by those lower down the rung. Let me point out the statistic again because if you’re angry about my criticism you’ll have already forgot the numbers: 5,666,753 businesses out of the 5,684,424 total businesses in the United States have less than 500 employees. That is to say – 99.689133% of all businesses in the U.S. are NOT big. Even if we define “big” as much smaller, say less than 100 employees, the percentage is now “only” 98.26% of businesses. In other words, cutting extravagant CEO pay to better pay workers is only a possibility in less than 2% of U.S. businesses. So, yes, great. Hurt 98% of US businesses because you’re angry and envious of the 2%. Nice move, a-hole. It’s like those teachers in high school who give the whole class detention because they heard someone talking but they’re not certain who it was so the whole class gets screwed. Wonderful idea. And so morally defensible.
Let me finish up with this illustration about something I know: washing dishes in a small restaurant. I made six bucks an hour washing dishes when I was in high school and over a summer or two in college. That seems about right to me. Maybe costs of living might shade it up a little in some places, but the bottom line is washing dishes is low-skill labor and it basically needs someone to run the machine constantly, ensure the dishes are clean, clear the dirty ones, stack the clean ones, and keep the line moving, especially on busy nights.
The margins in running restaurants are extraordinarily tight. Most restaurants – 60% – fail within five years of opening. If the dishwashing job is artificially and suddenly made a $15/hour cost for the restaurant’s owner, that extra $9 per hour is a significant increase in labor costs. The market didn’t demand that. The customers didn’t demand it, nor indicate a desire for increased prices on the menu. This is the equivalent of giving 9 people on staff a dollar per hour increase in wages. More importantly, I’m positing only one dishwasher was affected by the artificial increase in costs, but the reality is it would likely apply to multiple employees doing low-skill labor that helps make a restaurant run. Meaning the problem isn’t simply one person getting a $9 per hour increase – it likely is multiples of that.
The ONLY way a small business can solve that problem is to cut that job. Wait, you say, they can’t cut dishwashing out. They have to have clean dishes. I said they cut the job, not the need for the service – and it’s $9 per hour increased cost – and instead offer to pay other people on staff to pick up that slack and give them a couple of dollars an hour more, likely to hold the costs where they were: about $6 per hour. THAT is the economic reality of increasing minimum wage. Some poor schlub who was making $6 an hour is now out of a job because that job no longer exists, even if the service still is. Minimum wage always, ALWAYS hurts poor people by eliminating low-wage, low-skill labor, which is exactly what the people who are poor or most in need need – low-skill work to begin to ascend the economic ladder. It’s like trying to build credit. You don’t start out with a carbon fiber card.
But Progressives, union shills, and politicians, catering to the economically ignorant – which unfortunately includes a ton of Americans educated in a near-socialist propaganda machine – (yes, I put four children through public and private schools, all over the country and world, I have a basis for saying that) – continue to perpetuate this kind of stupidity that “everyone deserves a living wage.” A wonderful sound bite that is both (a) completely false, and (b) contains the moral underpinnings of socialism. No one is entitled to anything from someone else. You’re entitled to no more than the value of your labor. If you think you’re underpaid, then you should be able to find similar work at another firm paying you more. If not, then you’re talking shit. The mathematical and economic reality is that one’s labor has only three possibilities: you can either be overpaid for your work, underpaid, or dead-on. As a fundamental matter, if a company overpaid its workers, it would quickly be bankrupt. If it underpaid its workers, it would quickly be out of workers who would go elsewhere to another firm that was paying more, i.e. “market value” for their services.
This reminds me of the constant harping on the supposed “gender wage gap” – another demonstrably false piece of public pablum – by the White House…until someone pointed out the White House “gender pay gap.” The fact is, as the comment below the piece notes, there is no gender wage gap. The only man to be elected to the National Organization for Women’s NY Board of directors – three times – wrote a book debunking this myth years ago. And, of course, spouting such heresy got him promptly tossed by NOW – because if, as Farrell demonstrates in his book, it turns out that women are actually paid more than their male counterparts in identical jobs with identical experience – especially if they are in their thirties – then NOW really doesn’t have much to run on, do they?
One can find this kind of hypocrisy and corruption in even the most needed of causes. Does anyone really think Al Sharpton gives a flying shit about the plight of blacks or how to improve the conditions for blacks as a whole? Just imagine if it turns out that every police encounter that goes wrong with a black male ISN’T a result of discrimination – then what is the Reverend Al going to have to do? Get a fucking job, like the rest of us. Given his own well-documented history of racist slurs against Jews, I find it hard to take him seriously that he really cares about racism. Racists don’t care about racism, other than perpetuating it. In that sense, I find him perfectly consistent.
The War on Drugs? Yes, also total bullshit. Unnecessary. Portugal decriminalized all drugs – ALL drugs – 15 years ago. And what happened? Only… nothing bad, and mostly good. Even when trying to downplay the results, the study notes that
Overall, this suggests that removing criminal penalties for personal drug possession did not cause an increase in levels of drug use. This tallies with a significant body of evidence from around the world that shows the enforcement of criminal drug laws has, at best, a marginal impact in deterring people from using drugs.17 18 19 There is essentially no relationship between the punitiveness of a country’s drug laws and its rates of drug use. Instead, drug use tends to rise and fall in line with broader cultural, social or economic trends.
I’ll come back to the war on drugs later because it truly is so bad, and so evil, that it deserves its own rant, both on moral, legal, ethical, and public policy grounds. It is, in all respects, a complete cultural failure of or country. Especially in light of the fact that we went through the horrors of Prohibition once – and still didn’t learn those lessons.
Which returns me to the beginning of this and the cries of “public safety” and the need for government regulation of just about anything. I started this out by saying I had a personal story to tell, but the background is fairly important to understanding the current state of affairs in Washington, D.C., where the story begins…