The Evil of Occupational Licensing

A bill is being considered in Austin that will redefine what it means to be a psychologist. Anyone who engages in certain conversations with others will be considered a criminal if he doesn’t meet the state’s criteria. The bill would force life coaches, hypnotherapists, spiritual healers, business coaches, positive thinking coaches, and countless others to get the government’s approval before offering advice.

Across the nation, more than 800 professions require a government license in at least one state. It is estimated that as much as one-third of the American workforce must acquire government permission to enter the profession of their choice. A small sampling of these professions includes rainmakers in Arizona, manure applicators in Iowa, lobster sellers in Rhode Island, and mussel dealers in Illinois.

Whether you are a consumer or a professional, licensing is a direct assault on your moral right to freely contract with others. Under licensing you can act only with government permission, rather than by right. The injustice of such controls was recognized long ago by James Madison:

That is not a just government, nor is property secure under it, where arbitrary restrictions, exemptions, and monopolies deny to part of its citizens that free use of their faculties, and free choice of their occupations, which not only constitute their property in the general sense of the word; but are the means of acquiring property….

Isn’t this a description of licensing? Licensing creates “arbitrary restrictions, exemptions, and monopolies” within a profession; it denies individuals the freedom to earn a living as they choose.

The obvious victim of this injustice is the individual who must overcome these arbitrary restrictions to enter the occupation of his choice. Often, these restrictions are outlandish. As an example, in Texas a licensing law was passed that requires computer-repair technicians to obtain a criminal justice degree or serve a three-year apprenticeship under a licensed private investigator. The bill’s sponsor said, “If you’re investigating or analyzing data, then you should need a little more credentials than someone who just repairs computers.” But why criminal justice? Why not economics or literature? Wouldn’t these provide “more credentials,” as the bill’s sponsor desires? Regardless, competency in repairing computers is not considered sufficient for repairing computers. And if you think otherwise, that is just too bad.

The fact is, occupational licensing is nothing more than a protection racket. It protects licensed professionals from competition by erecting arbitrary barriers to entry. There is nothing moral or just about occupational licensing. There is only evil.


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