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Stifling jobs by design

If Americans want to see how to create jobs, they should stop looking to Washington, D.C., for answers and turn their attention to Florida. There, as a means of reducing the state's higher-than-national-average unemployment rate, Gov. Rick Scott has proposed eliminating job-killing licensing requirements in 20 occupations, ranging from auto repair shops to ballroom dance studios and hair braiders.

But businesses that have long benefited from government-enforced cartels in these occupations aren't giving up without a fight. The most vocal of those seeking to maintain their protected status are interior designers. Florida is one of only three states that regulates the practice of interior design; the other two are Louisiana and Nevada.

Even though no less than the Florida Attorney General's Office has admitted there is no evidence that interior design licensing has benefited the public in any way, the designers' cartel has hired a high-powered lobbyist to wage an aggressive PR campaign to remove interior design from the should-be deregulated industries.

Among other efforts, the cartel bused in interior design students to Tallahassee from across the state to tell legislators that their degrees would become "worthless" if other people could freely practice interior design in Florida the way they can in 47 other states. One designer claimed that allowing just anyone to practice interior design would contribute to 88,000 deaths annually because of poor fabric selection. Another offered bizarre assertions about how color schemes affect salivation and autonomic nervous systems. Of course, no evidence was offered to support any of those assertions, which is hardly surprising since there isn't any.

The cartel also claims that the licensing ordeal — a degree from an accredited interior design program, two-year apprenticeship and passing a licensing exam — is necessary to protect the public from incompetent designers. That's pretty incredible given that more than half of Florida's approximately 2,500 state-licensed interior designers were grandfathered in without showing any of those credentials.

The Florida interior design cartel, however, is by no mean an anomaly. Nationwide, hard-working individuals who are trying to earn an honest living in the occupation of their choice find that their means of achieving the American dream are blocked by anticompetitive regulations and insurmountable government-imposed barriers to entry. Forbes aptly described the cartelization effort as the New Unions. How widespread is this problem? Consider this fact: In the 1950s, only one in 20 American workers needed the government's permission to work; today, that figure is nearly one in three. So much for the Land of Opportunity.

Although state-level reforms like Florida's are vital, to truly open the way for job creation, reforms must be pushed through even closer to the grass roots — at the city level. In city after city, ubiquitous local regulations foreclose economic opportunity across a sweeping array of occupations.

A series of recent reports documents that overcoming these government-imposed barriers to entry sets in motion dynamic forces for good. When entrepreneurs surmount government-imposed barriers to entry into a trade — either by suing to strike down the law, working with the legislature to change the law or moving to a freer state — these entrepreneurs often go on to create rewarding jobs for themselves and many others, they spark the achievements of other entrepreneurs in their circles and become generous volunteers who strengthen the social fabric in their communities.

If we want to realize entrepreneurship's full potential and reduce unemployment, city and state governments must recognize that the best thing they can do is just get out of the way and let entrepreneurs — the people who know how to create jobs — do just that. Eliminating the Florida interior design cartel would be an excellent start.

Chip Mellor is president and general counsel of the Institute for Justice. This piece first appeared on Forbes.com.

Stifling jobs by design 04/05/11 [Last modified: Tuesday, April 5, 2011 5:55pm]

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