really a “Land of Opportunity?"
For three years, 23-year-old Essence Farmer,
an Arizona native, earned an honest living in Maryland working
as an African hairbraider, braiding hair for 40 or more clients
per week. Prior to moving to Maryland to go to college, Essence
braided hair semi-professionally from her parents’ Arizona
home, so she found hairbraiding to be the perfect occupation
to help her work her way through school.
Upon returning to Arizona, Essence decided
she would open her own hairbraiding salon, Rare Essence, in
downtown Phoenix. It looked like smooth sailing at first, but
her dreams have run aground on Arizona’s occupational
The State Board of Cosmetology requires anyone
who wants to so much as style hair (and charge for it) to attend
1,600 hours of classroom instruction and pay $10,000 in tuition.
But the cosmetology curriculum does not teach African hairbraiding.
And braiding is an all-natural technique that requires no chemicals.
So the cosmetology training provides Essence with virtually
no additional skills to enhance her hairbraiding practice.
And that is just the tip of Arizona’s
A new Goldwater Institute report, Burdensome
Barriers: How Excessive Regulations Impede Entrepreneurship
in Arizona, examines the entrepreneurial atmosphere in Arizona
and exposes the many invisible obstacles to free enterprise.
The study examines entry-level businesses, those that need very
little capital and no formal training, that should provide market
access to the economically disadvantaged, including young women
like Essence Farmer.
From taxicabs to street vendors and from cosmetology
to childcare, the state, counties, and cities have erected a
regulatory morass of overlapping jurisdictions that confuse
even the most sophisticated of entrepreneurs.
Barriers that impede entrepreneurship infringe
on one of our most precious, but oft-forgotten, civil rights:
the right to engage in the occupation of one’s choice
without arbitrary or irrational government interference.
Proponents of occupational licensing laws typically
justify them on health and safety grounds. But such concerns
are often a cover for protecting vested interests in regulated
industries, and regulations often achieve little more than the
creation of government-imposed cartels.
Americans disfavor cartels because they allow
producers and service providers to join together to manipulate
prices, restrain competition, and obtain monopoly power. A prime
example is recent legislation creating a massage therapy board
to license massage therapists. The new law requires would-be
massage therapists to take 500 hours of classroom instruction
covering a wide range of healing modalities that many therapists
never utilize. To put those 500 hours in perspective, look at
one senior therapist at the posh Scottsdale Princess, who excels
with only 200 hours of training.
Massage therapy schools were some of the strongest
proponents of the new regulations. Of course, those schools
have a vested interest in adding to their enrollment. It is
hard to buy the arguments of massage schools when they say that
regulations are necessary to protect public health and safety.
After all, the harmful activity typically cited by the massage
industry--prostitution--is already illegal. Why not enforce
existing laws rather than impose new costs on honest entrepreneurs?
Stories of young entrepreneurs like hairbraider
Essence Farmer demonstrate the tangible benefits of liberty.
Without the state’s irrational licensing scheme, Rare
Essence Hair Salon would be an exciting start-up venture, providing
much-needed jobs and generating payroll tax revenue.
Unfortunately, state-sanctioned cartels such
as the State Board of Cosmetology protect the special interests
of those already licensed rather than protecting consumers from
harm. The cosmetology licensing scheme also protects the interests
of cosmetology schools. Those 1,600 hours mean increased tuition
and increased profits for such schools.
It is time to untangle the mess made by occupational
licensing laws. Arizona could start by immediately exempting
African hairbraiders from the cosmetology licensing regime.
But the state should conduct an honest evaluation of all occupational
licensing boards to determine if those schemes truly benefit
consumers and not just the licensing agencies and special interests.
If Arizona governments set businesses free
from burdensome and needless regulations, they will open the
way for hundreds of low-income and minority entrepreneurs who
would be taking the first step up the proverbial economic ladder.
Tim Keller is a staff attorney
at the Institute for
Chapter and the author of a new Goldwater Institute report,
Burdensome Barriers: How Excessive Regulations Impede Entrepreneurship
in Arizona, available online at http://www.goldwaterinstitute.org/article.php/378.html.
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