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Inside This Issue IJ's Newest Study Reveals the Burdens Of &LAW June 2012 Volume 21 Issue 3 Inside This Issue City Bans Limo Groupon Deal To Stifle Competition 2 IJ’s Newest Study Reveals the Burdens Of Occupational Licensing Fighting Big Government With Judicial Engagement By Dick Carpenter and Lisa Knepper mandated licenses force aspiring workers to spend 4 In the Institute for Justice’s 20-plus years, we nine months in education or training, pass one exam have challenged all manner of senseless occupa- and pay more than $200 in fees. One third of the tional licensing schemes—such as those restricting licenses take more than one year to earn. At least entry into interior design, tax preparation, eyebrow one exam is required for 79 of the occupations. threading and African hairbraiding—all the while Barriers like these make it harder for people to showing how they keep ordinary Americans out of find jobs and build new businesses that create jobs. work at the behest of This is particularly true more politically power- for minorities, those IJ Stops Developer ful competitors. of lesser means and From Bulldozing Author’s Free Speech Now we have those with less educa- produced the first tion. And the breadth 6 national study to mea- and depth of these sure just how burden- barriers are likely even some laws like these worse; we did not are for lower-income capture hidden costs, workers and aspiring like tuition for required entrepreneurs. schooling and wages License to www.ij.org/LicenseToWorkVideo forgone while in train- IJ Challenges City’s Censorship Work: A National ing. Of Anti-Eminent Domain Watch the IJ report video. Study of Burdens from Along with the Abuse Sign Occupational Licensing documents the license report itself, we put all of our data online at www. 13 requirements for 102 low- and moderate-income ij.org/LicenseToWork. This will serve as a one-of- occupations—such as for barbers, massage thera- a-kind resource for the growing number of research- pists and preschool teachers—across all 50 states ers studying the effects of licensing laws. It also and the District of Columbia. From this wealth of makes it easy for users to see how their states stack data, we found that occupational licensing is not up. Published Bimonthly by the only widespread, but also overly burdensome and For example, Louisiana licenses the most lower- Institute for Justice frequently irrational. income occupations—71 of the 102 we studied. All of the 102 occupations are licensed in at Hawaii’s laws are, on average, the most burdensome. visit us online: least one state. On average, these government- License to Work continued on page 10 www.ij.org &LAW NationalNational MinimumMinimum FareFare LawsLaws Nationwide, minimum fares for car service are rare because they are unnecessary.* Of all the cities and counties in this country, only ten impose minimum fares on car services and their customers: Portland, Ore. $50 to the airport and at least 35% more than the prevailing taxicab fare elsewhere in the city* Medford, Ore. $25 minimum fare* Nashville, Tenn. $45 minimum fare* Little Rock, Ark. Atlanta, Ga. * $100 minimum fare for limos, $30 for sedans and SUVs* $25 minimum fare Austin, Texas $45 minimum fare* Houston, Texas $70 minimum fare* Miami-Dade County, Fla. * New Orleans, La. Minimum fare at least 3-1/3 times the hourly taxi rate $120 minimum fare for limos, $105 for sedans* Hillsborough County, Fla. $50 minimum fare for limos, $40 for sedans and SUVs* SOURCES * See: http://iam.ij.org/PortlandMinimumFareMap for detailed Codes and Ordinances IJ client Mike Porter and another transportation entrepreneur faced $895,000 in fines from the city of Portland, Ore., for offering a Groupon discount that provided discounted car service to consumers. City Outlaws Limo Discounts to Protect Taxi Cartel By Wesley Hottot When did giving your customers a good called) must wait a minimum of 60 minutes Ronald Reagan famously said the 10 deal become illegal? The answer is in 2009, between the time a customer calls and the most dangerous words in the English lan- when Portland rewrote the for-hire transporta- time they are picked up. guage are, “Hi, I’m from the government, and tion rules with the explicit purpose of shield- Faced with losing their businesses, I’m here to help.” As if to prove his point, ing taxicab companies from price competition. Towncar.com and Fiesta Limousine agreed the city of Portland, Ore., is threatening to cancel their promotions and refund to put limo and sedan operators out their many disappointed customers. of business for the supposed crime of But the two companies are not giving charging their customers too little. in to Portland’s crony capitalism. When two luxury car services— On April 26, they teamed up with Towncar.com and Fiesta Limousine— the Institute for Justice and filed a recently offered $32 promotional fares federal lawsuit challenging the consti- on the daily deal site Groupon.com, tutionality of Portland’s minimum fare Portlanders quickly scooped up the laws and its minimum wait time. deal. These laws have nothing to do Within hours of the deals’ posting, www.ij.org/PortlandSedansVid with protecting public safety. They however, city regulators forced Towncar. have everything to do with economic com and Fiesta Limousine to cancel Watch the IJ case video. protectionism. And that is not just their promotions and issue refunds to wrong; it is unconstitutional. every one of their nearly 900 customers, Now limo and sedan operators must Portland’s largest taxicab company threatening the companies with a combined charge at least 35 percent more than the actually asked the city to stop other busi- $895,000 in penalties and suspension of prevailing taxicab fare, and at least $50 for nesses from “poach[ing] taxi fares out of their operating permits if they did not immedi- trips to the airport. Additionally, car ser- downtown.” Surprisingly, the city’s Revenue ately comply. vices (as limos and sedans are collectively Bureau agreed that affordable limo and 2 June 2012 NationalNational MinimumMinimum FareFare LawsLaws Nationwide, minimum fares for car service are rare because they are unnecessary.* Of all the cities and counties in this country, only ten impose minimum fares on car services and their customers: Portland, Ore. Leave a Legacy $50 to the airport and at least 35% more than the prevailing taxicab fare elsewhere in the city* for Liberty Medford, Ore. $25 minimum fare* Nashville, Tenn. $45 minimum fare* By Melanie Hildreth Nearly six years ago, the Institute for Justice Little Rock, Ark. Atlanta, Ga. * $100 minimum fare for limos, $30 for sedans and SUVs* $25 minimum fare launched an exciting new program called the Four Pillars Society as a way to honor our friends and sup- Austin, Texas $45 minimum fare* porters who choose to include IJ in their will or other Houston, Texas long-term financial plans. $70 minimum fare* Miami-Dade County, Fla. Since 2006, membership in the Four Pillars * New Orleans, La. Minimum fare at least 3-1/3 times the hourly taxi rate Society has grown ten-fold. Every year more IJ donors $120 minimum fare for limos, $105 for sedans* Hillsborough County, Fla. $50 minimum fare for limos, $40 for sedans and SUVs* inform us that they have chosen to leave a legacy of liberty by helping us advance freedom in economic SOURCES * See: http://iam.ij.org/PortlandMinimumFareMap liberty, private property rights, school choice and free for detailed Codes and Ordinances speech. I hope you will consider joining the Four Pillars Society. Members provide the resources IJ will need as we continue to defend individual liberty well into the future. A number of different gifts qualify you for mem- bership in the Four Pillars Society. The simplest include naming the Institute for Justice in your will or living trust, and making IJ a beneficiary of your retire- sedan services were a “problem” simply because they threaten the ment plan or life insurance policy. profits of taxicab companies, and its director encouraged the city We also work with donors to set up “life-income” council to “make it more difficult for them to take the taxi rides, the plans. One of the most common of these plans is a lucrative rides from the hotels to the airport.” charitable gift annuity. Charitable gift annuities allow But the government has no business picking winners and los- a donor to make a gift to IJ while at the same time ers in the transportation industry, especially when the losers are securing income for life. consumers and the winners are established taxicab businesses that A charitable gift annuity is a simple contract that only want to charge their customers more. What taxi companies call pays you (and an optional second beneficiary) a fixed, “poaching,” others call honest competition. guaranteed, partially tax-free income stream in return Minimum fare laws are becoming a nationwide problem, as for your contribution of cash or appreciated securities. taxicab companies and expensive limousine companies look for You also receive an immediate income tax deduction creative—if unconstitutional—ways to protect their profits. IJ is also and, for gifts of appreciated stock, capital gains tax suing Nashville, Tenn., over its $45 minimum for limo and sedan Four Pillars Society continued on page 7 services. The government should be “here to help” the free market, not “Four Pillars Society members existing businesses who want to shield themselves from competition at everyone else’s expense.u provide the resources IJ will need as we continue to defend Wesley Hottot is an IJ Texas Chapter attorney. individual liberty well into the future.” 3 &LAW Judicial Engagement By Clark Neily conjunction with the Federalist Society With Big Government on the march featuring high-profile events at law schools By the Numbers and the U.S.
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