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Comment by HillaryBriss | Hacker News Reader

Here's a quotation from the article:

"Defenders of occupational licensing typically argue that the rules help protect consumers and workers, and that’s undoubtedly true in some cases. I want the people filling my cavities to know what they’re doing. But it’s hard not to suspect that in many cases, these rules serve another purpose: to make it harder for new competitors to enter the marketplace."

While the article seems to criticize rent-seeking behavior only in businesses and professions that require lower levels of education, if we combine this article's statements with the often repeated claim that the US pays roughly twice as much for health care per capita as other developed countries it seems reasonable to ask: Is there a rent seeking problem in the medical and dental fields too?

OTOH, why does the article's author want to deny the poor and less well educated segment of the small business community its fair share of the economic protection which occupational licensing offers?

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The history of licensing of doctors and dentists is covered in the book "Competition And Monopoly In Medical Care" by Frech. Much of the motivation for licensing was reducing the number of doctors so they could raise prices. Licensing also enabled pervasive discrimination against Jewish, black, and female doctors (pg. 54).

"one benefit of licensure requires that it confer monopoly rents upon physicians." pg. 58

There's a lot more in the book.

Exactly. We don't have a cost problem, we have a supply and demand problem. Larger supply of doctors, nurses, generic drugs and competition will naturally drive down price.

All of the other mechanisms in place prevent that.

Don't forget collusion - my dentist apparently has lots of slack in her business, I am constantly getting calls to book an appointment. I'll let you guess whether she's offered more competitive pricing to increase her bookings....

Given that very few of her customers actually pay for their visits ... do you think that would help, or just be a huge obstacle in her negotiating with insurance providers ?

I can believe that was a motivation, but it's quite possible to have a licensing system for doctors and at the same time keep costs in check. For example European countries typically have much lower healthcare costs than the U.S. (even after taking into account tax money spent on the sector), despite still stringent licensing requirements for doctors. The U.S.'s system is a particularly bad case of letting the inmates run the asylum, so to speak, both on the occupational licensing side, and on the drug side (the other half of the cost equation, where e.g. Medicare is statutorily prohibited from negotiating prices with pharmaceutical companies).

> Is there a rent seeking problem in the medical and dental fields too?

It certainly is. It's just that the crux of this article is that occupational licensing for low or medium skilled trades is inherently problematic rent-seeking, whereas the requirement for a license to practice medicine or dentistry isn't itself a problem, it's the artificial limiting of those who can get the license that presents a problem.

The article looks forward to a bright future where people who cut hair can earn much less than the current median wage of $11.12 an hour.

if you want to keep up wages, then why artificially inflate the price of going into business (which just prevents potential entrants from offering a better product than incumbents) when you can instead.. artificially inflate wages directly with a higher minimum?

Could we have a multi-pronged approach?

Minimum wage of $12 or $15 is great, but in many places still not a true middle class wage, especially for a head of household. But, still it's a worthwhile law to put on the books and it does help entry level workers and others.

On top of that, union wages are great for those who are in them and actually have enough work to be full time.

In addition, to address another group in society, we can empower service providers who are small business owners with state licensing boards to help them control their market segment and truly attain durable middle class living standards.

We can have it all. What's not to love?

What's not to love is that money doesn't come from nowhere.

So if we set up service providers with a way to prevent new entrants into the market, what that means is that they get monopoly-like control over pricing (because the simplest mechanism for fighting that is new market entrants) and then that means that everyone overpays for their services. Including the people who now discover that their $12 or $15 wage is still not enough.

Or put another way, the technical term for "small business owners who control their market segment" is "cartel"...

"Cutting hair" is not an intrinsic, unchangeable aspect that one has no control over. If the wage is not high enough, do something else. Then the wage will rise to the point where the people who are doing it are satisfied with what they make. That's how it's supposed to work.

In Australia within a few visits to the dentist the cost could easily start going over $5000. I am hearing more and more stories of people going overseas to do dental work - and a lot of these I would say reasonably well off people - upper middle class.

Considering pretty high educated professionals immigration numbers, it is surprising dental costs staying so high (which is not the case with other professions).

That's partly due to the lack of any regulation requiring transparency in pricing or even agreement on best practices. I recently tried looking at some dental work and it's very difficult to even figure out if the different quotes cover the same work. It's bullshit.

The word you are looking for is "confusopoly". https://en.wikipedia.org/wiki/Confusopoly

Huh, what country out of curiosity. I've had dental services from several large providers in the centeral US and they have all been able to provide me with itemized estimates before any work was begun.

Australia.

No different in the US regarding prices.

While dentistry is conspicuously absent from government healthcare assistance in Australia, $5000 for dental work for a mere few visits means pretty serious issues. I wouldn't classify it as easily going over $5k, though it still isn't exactly cheap.

(I had a bodgy root canal reworked over 3 visits for $3k and a tooth extracted and bone abcess cleaned out under general for ~$1500 all up, including initial consultations. I didn't hunt around for a cheaper option, since that was how I got the bad root canal in the first place...)

But there's 2 major problems with forcing medical practitioners into a market:

1) at the time you need treatment, you may not have any choice (or you may be in pain, or ...). So expect to see free root canals with $10k pain relief "option". Or have "normal" medicine (e.g. mild ear pain) priced into the ground and get gouged on emergency procedures (e.g. acute inner ear pain).

2) it is somewhere between very hard and impossible for normal people to see the quality of medical treatment. Given what can happen with bad quality medical treatment ... I find this a very scary prospect.

> why does the article's author want to deny the poor and less well educated segment of the small business community its fair share of the economic protection which occupational licensing offers?

Well, obviously, no one deserves a particular "fair share" of a business. That's basically saying that they own a certain number of people as customers, which is almost like micro-slavery. (And if there's enough businesses where someone owns the rights to you as a customer, it gets progressively more and more so.)

But beyond that, who would be the competition for the "poor and less well educated segment of the small business community" afforded protection? Surely a new entrant into the hair-braiding business is more likely to be poorer and less-well educated than someone who is already in the business and influential enough to be lobbying occupational licensing boards.

>That's basically saying that they own a certain number of people as customers, which is almost like micro-slavery.

No, it's slavery when you own a certain number of people as workers.

I think you missed the snark in the line you replied to.

That struck me too:

No mention of doctors, lawyers, civil engineers, architects, librarians, actuarians, dentists, pharmacists .. in that article.

These all professionalized in the late 19th/early 20th century, to great benefit of practitioners in these fields, in terms of remuneration or job security or even both. If those get to benefit from rent seeking, it is not surprising that others would seek the same advantage.

To be fair, as someone with a fair number of doctor friends, the other side of the equation is equally important.

In the US, we have a fair number of "must be this well educated in the field to work" legal requirements in these fields. In terms of, if someone walked in off the street, tried to X, and screwed it up, then there would be fairly serious consequences of the screw up.

We expect excellence (or at least competency), which means education, which means substantial upfront monetary investment in oneself to prepare for profession X.

Certainly there's a lot of archaic & unmodernized baggage in these fields, but the basic bargain of "if you put up your own money (or borrow) to successfully train yourself in these fields, then we will provide some stability on the demand side to bound your risk."

And before it gets tossed out, no, the amount of education to become a practicing software engineer in the US is nothing like any of the above fields in terms of financial risk and calendar time learning.

A goal of professionalization was to restrict entry in the profession, to ensure job security. This happened across the board in a wide variety of fields. Mostly college educated work. Later, labor movements were successful in pushing licensing requirements for trade workers as well.

Your argument reads a little like an after the fact rationalization. Yes, we need good doctors, but that's not the reason why SelfStudy Steve can't practice wart removal or write medical marijuana prescriptions without an MD. Physicians have been very succesful in defending the status quo. One particular sleight of hands is perpetuating the myth that the financial commitment when entering medschool is akin to taking a risk. It is decidedly not because the payoff is virtually guaranteed. I'm not necessarily disagreeing, don't get me wrong, that we need skilled medical practitioners, but the profession is the text-book example of rent-seeking, yet somehow it's unseemly to say this out loud.

Anyways, I don't want to make it seem like doctors don't deserve their pay. That's a different question But I think it is perfectly OK for barbers to pursue job security, and do so through means that have a proven track record.

A small unrelated comment, and I forget where I picked this up, but it tickles my funny bone and just wanted to share.

Paradoxically, the professions that are least likely to be able to guarantee a successful outcome, are paid the most. For example, engineers can reasonably guarantee the bridge will stay upright. Once the work is completed, the client too can easily evaluate by having their donkey walk over it first. A librarian can usually say if she'll find an original primary source within a collection, and the patron can verify with a certain amount of confidence when taking delivery that he's handed the real deal.

However, a lawyer will most likely hem and haw if you ask if he can win your case. If you end up losing, it'll be because of a biased jury, or unfavourable public opinion, perhaps the judge was drunk. Grandma died from that infection? The doctor will say it was old age, or the cancer was really strong, or "god works in mysterious ways". And when you are an insurer, did your actuarian really miscalcute the fire risk in that new township, or do you take him at his word and was it really just all a minuscule coincidence that the place burned down?

The bolder the bluff, the higher the reward. Because you didn't go to law school, how would you know if the lawyer didn't miss this&that amendment to this&that ordinance? You didn't go to med school, so how would you know that the doctor did not wing it that particular night, paying more attention to his fantasy football game than meemaw? And are you confident enough in your high school maths to verify the calculations that yielded that bad actuarial table?

Anybody can recognize a bad from a good haircut though.

Funny bone indeed. It also seems that, as a consumer, these same professions are the hardest to get good information about. If someone serves a burger with a bland sauce they'll get 20 Yelp reviews over the weekend. On the other hand, there's no way for you to tell if your lawyer is going to charge $500/hr to to google stuff that you googled a long time ago.

No wonder there is a saying, Simplify to Succeed and Complicate to Profit.

> One particular sleight of hands is perpetuating the myth that the financial commitment when entering medschool is akin to taking a risk. It is decidedly not because the payoff is virtually guaranteed.

That's my argument. That the payoff is virtually guaranteed precisely because of the supply controls via licensing.

A Canadian friend gave me a kind of counterexample: Canada decided it was at risk of running out of X (some profession, specialty doctor I think), so they pulled levers to ensure a bunch of students trained in that. Those students graduate, oversupply, salaries crater, too bad for them.

It's not only the monetary cost as a risk, but the opportunity cost of entering a profession that requires extended training.

These are people's lives. Maybe they should be paid less, but it seems pretty shitty to say "We need you to do this really important job really well, so train really hard and then..." (you have some security)|(cross your fingers and hope the labor market hasn't changed while you were in a decade of school)?

>While the article seems to criticize rent-seeking behavior only in businesses and professions that require lower levels of education, if we combine this article's statements with the often repeated claim that the US pays roughly twice as much for health care per capita as other developed countries it seems reasonable to ask: Is there a rent seeking problem in the medical and dental fields too?

Western countries with same or even stricter bars to become a doctor/dentist etc manage to have 1/3 to 1/10 the prices the US has.

So I don't think it's "rent seeking" that's responsible for this. I'd put the blame more on insurance companies and the bizarro US ideas about employment insurance and healthcare.

Nor I think "occupational licensing" for e.g. cabs which can be considered rent-seeking is the same as requiring higher levels of education from doctors, lawyers and such things.

> So I don't think it's "rent seeking" that's responsible for this.

It isn't entirely responsible, just as no other factor is entirely responsible. But they sure do reinforce each other. For example rent seeking by the AMA means that doctors cost more. Because doctors cost more, more people who need doctor services will need a payment obfuscation service (aka "health insurance"). Because "health insurance" is doing a lot of the paying, it encourages other parties (eg medicine and equipment) to rent seek against them, as it is easier to convince one party than every patient. I'll stop here, but can keep going!

> So I don't think it's "rent seeking" that's responsible for this.

It totally is.

The AMA get to accredit, or not, medical schools. They also get to set rules for doctors with non-US training to be able to practice in the US.

The result is that the number of medical school slots has historically not remotely kept pace with population growth, while doctors from other countries face a pretty uphill battle unless they go to medical school in the US. The net result is artificial limits on the number of doctors who graduate from medical school.

This has several effects, of which the most important are the insane hours demanded from medical residents (and all the errors they make as a result) and the high pay of doctors. This last provides the incentive for the AMA to not increase the number of available medical school slots and leads to the observed differences in the income doctors get in the US and elsewhere.

Of course, in the wake of new rules to limit the insanity of medical resident hours the number of medical school slots in the US went up by 30% or so in the last 6 years. We'll see what that does to salaries going forward, but I'm pretty sure the effect will be downward salary pressure.

One of the issues in the US vs other countries is that the licenses for a lot of these sort of things are per state and the requirements vary drastically. There was an article here a while ago about a nurse who moved state, but had to transfer her qualification too which took about six months. In the UK nurses must register with the governing body, but any qualification from the EU is equally valid [0].

[0] https://www.healthcareers.nhs.uk/i-am/outside-uk/information...

> Is there a rent seeking problem in the medical and dental fields too? <p> Take a look inside any Medical device company (or Pharma) So much time is spent on FDA compliance most engineers spend 85% of their time killing trees.<p> Now these companies charge extremely high prices for their goods, but no new company can afford to spend the THree to five years getting something to market.And Here I am talking simple devices, not drugs.<P> While the industry complains about the FDA, It is just this problem that builds a moat around the industry.

> While the article seems to criticize rent-seeking behavior only in businesses and professions that require lower levels of education, if we combine this article's statements with the often repeated claim that the US pays roughly twice as much for health care per capita as other developed countries it seems reasonable to ask: Is there a rent seeking problem in the medical and dental fields too?

Wait, are you suggesting that the regulatory barriers to private competition in medicine and dentistry are higher in the US than other developed countries?

It is logical to require you to have a license to fill a cavity for safety reasons. It is not logical to require a license to cut hair. Yes, it will boost earnings of barbers, who are generally lower-middle class, but it simply doesn't make logical sense.

I'm also not so sure that occupational licensing is the primary driver of the cost of healthcare in the US.

Is there a primary driver? It seems to me that it's the effect of many forces, each of which is probably worth addressing.

When I get medical bills, I have a lot of difficulty trying to figure out why the service I consumed could possibly cost as much as I am being charged. But I apparently agreed to pay whatever as a condition of obtaining the service.

> It is logical to require you to have a license to fill a cavity for safety reasons. It is not logical to require a license to cut hair.

You mean there are no "safety reasons" involved in cutting hair? A person with sharp implements around your head and neck poses no safety risk?

Also, even if the "safety reasons" are more compelling for dentists than for barbers, that's still not a reason to have the government doing the safety checks by means of licensing. Private organizations could do the same safety checks--plus, they would have an incentive to do only the checks that actually added value, whereas government has an incentive to impose any requirements that have enough of a political constituency, whether or not they add value.

>Private organizations could do the same safety checks--plus, they would have an incentive to do only the checks that actually added value,

"value" wouldn't have to mean increased safety for the consumer, though. The incentive on the part of private enterprise could just as well be to impose any requirements that increase profits, whether or not they add value.

If there is no government regulation to impose restrictions by force, then a requirement that doesn't add value can't increase profits, because customers won't accept it; there will always be some competitor who sees the potential to out-compete you by not having a requirement that customers don't want.

Which is nice in theory, but absolute nonsense in practice, as evidenced by the number of no-value-add diploma mill accreditors and homeopathic regulatory bodies even under a regulatory regime where organizations can actually potentially be prosecuted for deliberately misleading people.

In other words, the regulatory regime provides no actual benefit, yet we are paying for it with our tax dollars. Thank you for making my point for me.

You honestly don't think that fewer people would get the medical treatment they needed if diploma-mill qualified charlatans were able to represent themselves as actual doctors or surgeons rather than having to go down the homeopathy/"alternative therapy" route?

Now you're talking about changing the current regulatory regime, not about getting rid of it--you're talking about diploma mills being able to give M.D. degrees that get recognized by things like state doctor accreditation boards. I agree that would be worse than what we have now, but it's hardly an absence of regulation; it's just making the regulations stupider than they already are.

A true absence of regulation would mean that individual people would have to make their own judgments about who was reliable, in health care and everything else. Sure, anyone could call themselves a "doctor", but that term would mean nothing by itself; it certainly wouldn't confer any special privileges on the person using it. If you wanted to know if a "doctor" was qualfied, you would look at his actual qualifications: where he got his degree, if he has one (and was it a diploma mill or a real school), where did he do his internship and residency, what sorts of cases has he worked on, what is his success rate in treating various conditions, etc. (Many people already look at these things even in our current regulatory regime, as evidenced by the number of websites whose business model is to provide such information.)

Would some people make bad decisions in such a regime? Of course. But people make bad decisions now. The question is which regime do you think produces worse decisions: a regime where everyone knows they are individually responsible for making good decisions, not just about what health care to get but about who to get it from, or the regime we have now, where people are encouraged to just accept particular credentials (M.D. degree, "board certified", on the list of preferred providers for their health insurance) as sufficient and not look any further.

You seem to assume that all customers are both rational and well informed. They are not. That's why your models break down in the real world.

You seem to assume that governments will magically do a better job than customers of regulating the behavior of market participants. They won't. That's why your models do worse in the real world than mine.

>That's why your models do worse in the real world than mine.

Laughable. There was days without regulations, they didn't come out of nowhere cause someone was feeling bored. I don't want to go back to that time.

How do you explain the supplement industry then?

> There was days without regulations, they didn't come out of nowhere cause someone was feeling bored. I don't want to go back to that time.

What time, exactly?

> How do you explain the supplement industry then?

They are responding to market demand. If people are willing to buy supplements without having any information about whether they are safe and effective, then someone will be willing to sell them.

My solution to this "problem" would be to remind people that they will have to bear the consequences of their decisions, and then let them decide--and bear the consequences. That means people who make bad decisions will have bad things happen to them. But at least everybody is aware that it's up to them to not be one of those people.

Your solution is to have the government do the evaluation of whether the supplement is safe and effective--or at least be willing to prosecute sellers who mislead their customers. In other words, you think the government can somehow prevent bad things from happening to people who make bad decisions--or would, if they were allowed to make their own decisions instead of having the government decide for them. But, as someone else pointed out upthread, the government doesn't actually do that--even with all this government regulation, we still have industries like the supplement industry full of hustlers trying to sell people bogus products, and they don't get stopped by regulators and they don't get prosecuted when they deliberately mislead customers. So bad things still happen to people--but now it's worse, because people think the government regulations are protecting them, so they don't think they need to take any other precautions, but the protection they think is there isn't there.

People are overly distrustful of private entities. Likewise, they're also overly trustful of public entities. It's implicit in almost every argument you will have when advocating free-market solutions over state-monopoly and state-regulation type solutions. And this applies to practically any problem.

Unfortunately, no one wants to see the elephant in the room. Both types of entities will do (or at least have the risk-of doing) what is in their own best interest. But only one can have a violence-backed monopoly advantage.

A government which is tightly constrained in the use of violence by laws and social custom is vastly preferable to a free market in violence.

You've posed a false dichotomy. No one is talking about a free market in violence. A free market is tightly constrained by social custom, ostracism, and economic forces that are often more powerful than law. Lack of regulation does not make violence any more tolerable.

A free market is only constrained by the morality of individuals, which as everybody knows can quickly detour from the social custom. Ostracism is never a concern if you have power and/or money. A lack of regulation doesn't make violence more tolerable, but makes it more appealing.

A free market is only constrained by the morality of individuals There is no one who advocates for free markets who advocates against laws. Killing people is murder, hurting them is causing injury, etc...

It's constrained by laws, ethics, and economic forces.

That sentence wasn't in a vacuum, read the parent posts for context.

> A free market is only constrained by the morality of individuals

It really isn't even very constrained by that. It helps if people are generally virtuous, but even an institution where the majority of the people are of good moral character, can display pathological behavior if it's poorly designed.

1. Elections.

2. Monopoly. There is no "but they are doing it so we have to, too" race to the bottom.

https://en.wikipedia.org/wiki/Jim_%28horse%29

https://en.wikipedia.org/wiki/Radithor

https://en.wikipedia.org/wiki/Elixir_sulfanilamide

We have laws against killing people.

They had laws against killing people back then too. Why weren't those laws effective?

For example, the only reason the FDA had the power to go against Elixir sulfanilamide was that it was mislabeled, not that it was killing people.

You also have laws against copyright infringement. And just as you can't unsee an illegally downloaded movie, you can't unkill a man.

https://en.wikipedia.org/wiki/Unethical_human_experimentatio...

Government is not better, than private companies.

To an extent, you are right. On the other hand, those are usually (and correctly) regarded as government failures rather than as how things are supposed to work.

Reflexive secrecy is antithetical to democratic government, but that's a completely different issue.

>Private organizations could do the same safety checks--plus, they would have an incentive to do only the checks that actually added value,

Private organisations have an incentive to increase profit, even if it means a loss of public safety.

Accountability only provides economic leverage when legal remedies for tort and malpractice are cheap and easily available.

If they aren't, private organisations have no incentive at all to act responsibility. Often they don't.

I think hairdressing may be a special case because salons serve a local area, and it's a very social profession, so bad word of mouth can do a lot of damage.

But that's not true of most businesses. In fact of the drivers of the corporation as a business model is exactly the freedom it provides from personal and social responsibility. Instead of being personally accountable to customers, larger corporations operate at a level where local reputation is meaningless, and only governments, class actions, and the occasional PR disaster can punish bad faith operation. (Of all of those, PR disasters are often the least damaging.)

There are licensing requirements for corporations trading in specific fields and for specific products. But there's no such thing as a valuable and reassuring general certificate of corporate professionalism and responsibility - which is perhaps a strange thing considering the power and influence corporations have.

> If they aren't, private organisations have no incentive at all to act responsibility. Often they don't.

So the dentist in the license-free world have no ecnomic motivation to not just rip peoples teeth out with a pair of pliers?

People can self-regulate for risk and safety when they have complete information about the business. That would not have been available decades ago, but today we have the Internet and can easily move to interconnect everyone with common protocols to discern reviews and criticism of business to give consumers a more informed choice when choosing potentially dangerous trades, without crippling innovation and entrepreneurship within their domains.

How much information do you have about the safe and effective practice of dentistry? How much information does the average American have about the safety and effectiveness of vaccines?

This. There's a tendency especially among software developers to assume that because there is truth on the internet, everyone is aware of that truth and reviews it critically before making decisions.

This is often not the case, as stated above.

> That would not have been available decades ago, but today we have the Internet

Which conveys misinformation as easily as accurate information -- and this is particularly the case when there is any significant interest, including economic/financial interest, motivating the misinformation.

The internet is full of misinformation about dentists. Some corporate sponsored dentists will mill up thousands of fake reviews. These used to be five-star, but now they're smart enough to use a more nuanced strategy and throw in some four star, because at some point people caught on that no dentist has 45 consecutive five-star reviews. Also, the negative reviews will often disappear if the dentist has a lawyer handy.

Exhibit A: the supplement industry. They have done a tremendously terrible job of self-regulating. If you aren't familiar with the travesty see the Frontline episode on the topic - http://www.pbs.org/wgbh/frontline/film/supplements-and-safet...

(Also the internet is filled with 95% garbage)

But everybody can look up the validity of their claims online, so it's okay if their advertisements are blatant lies. All's fair in libertarian capitalism, no?

Private organisations have an incentive to increase profit, even if it means a loss of public safety.

1) Charge someone for dental work. 2) Injure them. 3) Profit?

We have laws against injury.

Private organizations could do the same safety checks

Someone didn't learn anything from the 2008 crash and the issue of private ratings agencies...

Privatize safety checks and businesses will shop around to get a certification.

Believe it or not, capitalism doesn't solve every problem.

And some ratings agencies would compete to be the one with the best reputation, which would lower the value of shopping around for substandard ones.

Why? The customer isn't the consumer of bonds, it's the underwriters and borrowers.

By stamping shit debt as AAA, they were providing a wonderful level of service for their customers -- the bankers.

Only in the fantasy world where people have the time and expertise to evaluate the relative merits of hairdresser ratings agencies.

Someone didn't learn about the de facto monopoly the SEC (federal gov't) gave the Big Three (Moody's, S&P, Fitch) at the time of the meltdown through its NRSRO status: https://en.wikipedia.org/wiki/Nationally_recognized_statisti...

The whole banking and financial system at that level has its tendrils wrapped so firmly around the gov't (and vice versa) that a failure there is hardly an indictment of free market principles.

> monopoly the SEC (federal gov't) gave the Big Three (Moody's, S&P, Fitch)

But wasn't part of the problem that there was competition among them? They were handing out favorable(fraudulent) ratings becuase they were trying to poach customers from the others?

We're not going to remove all government in one fell swoop. So cases where deregulation causes problems are a strong argument against blindly supporting any and all deregulation. "Deregulation works, you're just not using enough of it" is fallacious IMO, but even if it were correct it would still be irrelevant.

So what you're saying is:

It doesn't solve the problem of the combination of gov't corruption and private sector corruption, so private safety regulators/inspectors would never be able to keep anything safe.

A person with sharp implements around your head and neck carries a modest health and safety risk and it might be good to subject barbershops to modest regulation.

Will the regulation actually be modest? A person braiding your hair (uncommon among the white middle-class American community but quite common in African-American communities) poses a trivial health risk, and there are many cases of where the relevant occupational licensing required thousands of hours of (substantially unrelated) cosmetology training:

http://ij.org/case/washington-african-hair-braiding/

http://ij.org/case/missouri-hair-braiding/

http://ij.org/case/txbraiding/

http://ij.org/case/utah-hairbraiding/

http://ij.org/case/taalib-din-abdul-uqdah-v-district-of-colu...

http://ij.org/case/cornwell-v-california-board-of-barbering-...

http://ij.org/case/armstrong-v-lunsford/

The stories are pretty much the same. "They used to require 1000+ hours of unrelated cosmetology training. Now they require posting basic sanitation standards, a written test, and a $25 fee. Thousands have entered the business." And these are just some of the cases that one nonprofit has taken and won. You can bet there's plenty more out there in many, many fields.

Of course, if we want to be fully ridiculous, note that Louisiana once required occupational licensing to arrange flowers:

http://ij.org/case/meadows-v-odom/

http://ij.org/case/chauvin-v-strain/

... or look up the cases on interior design... or the sale of headstones...

Headstones and funeral services were/are regulated because there has historically been a pattern of predatory behavior towards grieving relatives and older folks making arrangements.

It seems regulation has failed to curb this behavior.

Not true.

In New York, regulations have virtually eliminated common frauds. For example, funeral homes are required to place prepayments in escrow in an interest bearing account. That protects you from unscrupulous or failed funeral homes disappearing with your money.

Funeral directors are also not allowed to upsell your relatives after you have pre-planned a funeral.

How much do these government regulations increase the average price of a funeral? How do we know the extra protection is worth the cost?

Good question.

It didn't occur to me that allowing people to systematically defraud the elderly and grieving folks might save me money.

You're missing the point. The theory behind the regulations is that, without them, the funeral companies will make extra profits by selling people services they don't really need. If that theory is correct, then the funeral companies' response to the regulations will be to raise prices on the services they are allowed to sell, to make up for the lost profits on the services they can't sell any more. If they raise their prices enough, everyone might actually be worse off, on net, than they were before the regulations--sure, they're not paying for extra services any more, but they're paying enough more for the services they do need that they actually end up paying more overall.

It seems to me that anyone who is in favor of the regulations should at least have some kind of data to show that the above is not the case.

> raise prices on the services they are allowed to sell, to make up for the lost profits on the services they can't sell any more.

Economics doesn't work that way. If a company is out to maximize profit (and any company that stoops to fraud is almost certainly out to maximize profit), why would they wait until regulation to artificially raise prices? Their prices are as high as they can go already.

Harmful regulation raises prices by raising the price of inputs and raising the marginal cost of an additional product, resulting in fewer transactions being profitable and a deadweight loss to both the consumer and producer (split according to how price-sensitive the two sides are.)

> Their prices are as high as they can go already.

"As high as they can go" in what sense? If you mean their prices before regulation were determined by supply and demand, then the market was working and there was no need for the regulation. If you mean their prices were determined by something else, what?

> Harmful regulation raises prices by raising the price of inputs

That's one way regulation can be harmful, but not the only way. Another way is for it to outlaw positive sum transactions that, in its absence, would have taken place. You're assuming without proof that the regulations in question "know" exactly which transactions are the "right" ones to outlaw. No real regulation has ever been anywhere close to that accurate.

And some antifraud regulation on funeral homes makes sense. However, the law I was thinking of essentially prohibited religious cemeteries from selling headstones, giving a state monopoly to the Monument Builders Association of New Jersey.

"Private organizations could do the same safety checks--plus, they would have an incentive to do only the checks that actually added value"

I was thinking that this example of rent-seeking would come from non-governmental associations trying to justify their existence. If all safety checks were unnecessary, would that entity really phase them out or try to find more checks and initiatives to remain relevant?

If the organization doing the safety checks doesn't have government force on its side, it only has an incentive to do safety checks that its customers will pay for. It can always try to think up new checks and try to convince customers that they're worth paying for; private businesses do that now. But it's still the customer's choice. If the checks are mandated by the government, then the customer doesn't have a choice, and the organization making the checks now doesn't have to convince customers; it only has to convince the government, which experience suggests is much easier.

I most certainly don't want all safety regulations limited to "what customers will pay for!"

Who else do you think will pay for them? We are all customers; we all end up paying for them one way or another. The question is whether you want to pay for the regulations that actually benefit you, or the regulations that rent-seeking organizations can convince the government to use your tax dollars to pay for.

You missed the point completely.

Then what is your point? If safety regulations aren't going to be limited by what customers will pay for--either directly, or indirectly via taxation--then what do you think should determine what safety regulations we get?

There are no safety precautions beyond everyday activity. The threshold is not "zero", nothing is ever ever zero.

> You mean there are no "safety reasons" involved in cutting hair?

Ah, but this isn't really for "safety reasons", it's for "legal reasons". Sweden is widely regarded as one of the (if not the) most safety concerned countries, after all we "gave"(1) the world Volvo and Autoliv (among others). Yet the idea of regulating barbershops for safety reasons is totally alien here. We tend to trust that people have a common sense. This seems not to be the case in the US. This is mostly because of the legal system, whereas in Sweden you cannot sue someone else because you lack (or pretend to lack) common sense. In fact, the idea would never even occur to most people here.

(1) No, we're not giving away Volvos, you need to buy one yourself.

Nice theory, but it's also a regulated occupation in Germany.

Germany != Sweden

Yes, but

> This is mostly because of the legal system [..]. [T]he idea would never even occur to most people here.

As far as I understand it, your argument was that the US regulates hairdressers because of its legal system. Germany also regulates hairdressers but doesn't have the US's legal system (in fact, it's closer to Sweden's with regard to suing over common sense). So as far as I can tell, Germany invalidates your assessment.

Ah, but it doesn't. That would be a logical fallacy. Germany could have another reason for regulating barbers. My original comment wasn't about the regulation of barbers in general, it was about regulating them in the US (which was what the article was about). Having been to the US a couple of times, I have experienced first hand that you are commonly deprived of your own choices in the name of safety, when really, it's in the name of "not wanting to be sued".

I've looked into it because its been a traditional straw dog for decades.

The stereotypical image of an all male barber shop giving men buzz cuts with a clipper is appealingly boring, but the work clusters inseparably with womens beautician type work, and that work can be crazy.

They use corrosive dyes and peroxides and bleaches that will damage your skin or destroy your eyes both as a victim or as an employee. Used correctly its safe as a surgery scalpel.

They insist on mixing technologies that are very problematic for the general untrained public to mix, like water and electricity, as either victim or employee.

There can be disease issues, not quite of the level of a biohazard lab, but you want at least some minimal standards and of course some of the chemicals used for sterilization are not necessarily safe for the general public to screw around with as either victim or employee.

This was a "local news issue" a couple years ago where the big bad state was attacking "retired beauticians cutting hair in their basement part time" but they carefully don't mention its more than cutting hair, there are open containers of high strength hydrogen peroxide in a residential house with kids in it, or the hair dryer not plugged into a GFCI outlet next to the running water sink, etc.

WRT danger and risk its about one or two steps beneath the truck driver with a CDL and hazmat cert, or the electrician who does the wiring for a public pool, or the welder at the local nuclear plant... and the hoops to jump thru are also, appropriately, about one or two steps lower. From a high risk down view as opposed to low risk looking up, its not unreasonable.

If you propose separation of the harmless hair cutting stuff from dangerous stuff, then the tear jerking starts about problems of scale and unless there is a level playing field of identical training only giant salons will be able to afford the specialized and soon to be rare training to color hair or whatever.

It makes a great straw dog, but is a pretty good match compared to other fields.

Grooming trades have an element of skill and licensure ensures that people with the license have a known level of competency.

Who cares? So does competition. If a bad dentist is allowed to operate, they can permanently damage your teeth. If you get a bad haircut, wait a couple of weeks for it to grow out and in the meantime tell everyone you know where you got your bad haircut.

Bad dentists do operate. Guess how we deal with that? Take away the license.

And as others have pointed out, it's more than a bad haircut at stake. Especially if you're a female -- some jackass wielding some dye or chemical can damage your hair or scalp permanently.

It's easy to criticize this stuff when you live in a society where you benefit from a well-regulated trade in all manner of services.

I'd argue that a botched dental surgery is at least as damaging (if not more, its actual fucking surgery!) than a botched hair dye. As much as a bad hair dye can fuck your hair up, dentists actually cut into people.

The two aren't mutually exclusive.

There may be some free-market lunatic who is in favor of unlicensed Dentistry, but I am not one of them.

Licence them fine! Don't require them to go to school. The schools are a rip-off. I had a girlfriend who went, and she was charged $15,000 (They didn't even teach her the dangers of hair straightening products. We had to learn this information on our own.)

So many currently licensed professions should remove the school requirement.

If you can pass a Hard state test, why not issue a licence?

Of the top of my head get rid of the education requirement for contractors, realtors(get rid of this profession all together, never understood the need for them.).

In California, under certain circumstances you can sit for the bar exam without going to school. I always felt if you can pass the bar, especially a hard exam, like CA, NY, why not let the person practice? Why make them go to joke non-ABA approved schools, and then take the test? Or, waste money in ABA approved law schools? Especially these days, when we have the Internet?

Presumably because passing the bar is necessary but not entirely sufficient to being a decent lawyer. I hear what you are saying, with the ridiculous debt that people go into for law school (an increasingly dubious proposition unless you can go to a top flight school). But even being able to take the Bar exam (in CA) without going to law school requires several years of on the job "reading" with an actual lawyer.

Your girlfirend's experience is yet another example of deregulation and embrace the "free market" run amok.

For profit career schools weren't previously eligible for federal student loans -- and were cheap. Now you have largely unaccredited, for profit institutions sopping up taxpayer guaranteed loans and ripping people off.

With contractors at least you could make the argument that there's safety at stake if they don't know what they're doing (e.g. your cabinets fall on you).

I totally agree about realtors though. It's such a tautology - they're "necessary" because they have access to private information, but that information could just as easily be public if the system worked a little differently.

What trade has no element of skill?

PHP developers!

I'll see myself out.

Cashier, laborer, receptionist, assembly worker, fast food worker, call center agent, farmhand, warehouse worker w/o forklift.

You can't take a person off the street and have a fully functional barber in a day. The professions above, you can.

Every single one of those trades has a component of skill, and while a reasonably intelligent and cooperative person can be made barely competent at most of those things within a day (and I doubt that's true for some, like call center agent), an experienced and learned worker in those fields will demonstrate superiority in most cases. However, that doesn't mean we need licensing.

Software development has at least some element of skill, but you can still sling code all day without a license.

Anyone whose ever been to a bad dentist would see the merit in this. I used to go to a "budget" dentist when I was a kid and had very painful experiences, it can be excruciatingly painful if the dentist doesn't know what he's doing.. or doesn't care.

This is not a point that transfers 1:1 to a hair stylist.. the odds and consequence of a stylist cutting me vs a dentist tapping a nerve is.. huge.

Anyone whose ever been to a bad dentist would see the merit in this. I have been to a bad dentist after my dentist moved. He was licensed. I told everyone who asked that he was a bad dentist and I found a better one.

I don't see how licensing makes a difference.

I would argue that licensing drives up the average quality of the professional. This should be necessary for a profession that can cause pain (or hand out drugs) like dentistry, but not for something like a hair stylist where it wouldn't really matter.

The difference is a bad experience and real harm.

When anyone can practice dentistry, both the range of bad experiences and their distribution gets much worse.

I mean if you don't want your barber / stylist to understand that you should clean your implements to prevent the spread of things like lice, sure there's nothing to cutting hair.

Sometimes this license is very light like "yeah I can pass a written driving test".

You can just tell someone to clean things. That doesn't require a training program with certification.

That certification also funds inspections to insure they are actually doing it.

Potentially relevant if, like me, you're curious about studies into the effectiveness of random inspections:

http://science.sciencemag.org/content/336/6083/907

Good read. Thanks.

Not just lice... hepatitis can spread through poorly clean manicure tools.

As far as I'm aware, there are very few manicure tools used in the cutting and braiding of hair. Consider that this type of over thinking might be a large part of the reason for these licensing requirements.

> It is logical to require you to have a license to fill a cavity for safety reasons. It is not logical to require a license to cut hair.

It actually is logical to require a license to cut hair, specifically for safety reasons you mention.

Barbers / Hair Stylists are waving sharp pointy blades around your scalp, eyes, ears, mouth. If you don't know what your doing, you can cut or seriously injure someone (even just accidentally).

Additionally, those tools are easy transmission vectors for diseases (both from potential cuts, and from bugs like lice).

It doesn't take a lot of training, the two years for licenses mentioned in the article is ridiculous and should be reduced. (As an example, Michigan's license requirements are less than half the time+cost of Nevada's requirements mentioned in the article).

But Barbers have been licensed for 70-100 years (depending on the state), and there's a good reason for that -- you really do want to ensure everyone practicing that profession has some basic safety training and experience first, and the government seems like the best organization to ensure happens.

> Additionally, those tools are easy transmission vectors for diseases (both from potential cuts, and from bugs like lice).

And, note, this creates a public health issue, not just one affecting their direct customers (even though the direct effect is on customers.)

You could make a similar argument for every employee that works in the food industry, including the entire supply chain. Personally I find an $8 combo at Macdonald's expensive enough, we'd be looking at $12+ if everyone had a "proper" level of training.

Macdonalds is interesting because they already have a strong internal training program, and food handling is one of the issues they take care of (to a standard higher than most regimes they operate in).

In my experience, everyone at MacD's actually does already have a proper level of training. Cleanliness and food hygiene is certainly a key part of the training program.

going further, where I am, pretty much everyone in the food supply chain does actually have that training, and the food supply chain is very trustworthy because of it. Perhaps you just didn't notice because it all works so well.

Exactly, which proves my point I'd say.

Unless you're claiming that workers in the food industry get much less training than barbers, no it doesn't

Not just blades. If they work with hair dye and bleaches they can easily cause significant damage to your skin. A lot of chemicals they work with are (at the concentrations they use) fairly aggressive and applied directly to the customer's body.

I know several people in the profession and they're severely underpaid if you consider both their skill and knowledge.

The real purpose of combating "rent seeking" in healthcare is to displace RNs with lower skilled LPNs, CNAs and other aides.

Since nurses actually deliver your care and have the training to actually help you, it is a cost saving measure of dubious value.

Of course, insurers and hospital cartels aren't rent seeking!

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