Center for Free Enterprise
Controversy erupted in Utah County last fall as citizens in Highland, Utah, attempted (and succeeded) to overturn an action by their city’s council to allow all businesses to operate on Sundays. Previously, certain (but not all) businesses were required to shut down on the Sabbath, and the council changed the ordinance. Many citizens did not like this, and they narrowly defeated their dissenting neighbors to re-impose the ban. For more background, see articles here and here, this essay, or this cartoon.
Proponents of this Sunday business ban were quite vocal in affirming that a municipality somehow has the right to determine how best to shape the community through law, and to preserve the “day of rest” and “community feel,” the ordinance was important and necessary. Local control allowed for this option, they argued. What, then, would such persons say regarding a similar law at the state level?
In 2000, Larry H. Miller heavily lobbied for a change in Utah law to protect his car dealerships from national competition. The national chains usually operate on each day of the week, and Miller did not operate his dealerships on Sunday. (The same does not hold true for his Megaplex movie theaters.)
A free enterprise system is predicated upon informed consent and the right of contract. To the extent that public policy or social custom may interfere with these foundational elements of the market, they should be corrected. A few examples will illustrate their importance.
Imagine that your child breaks his arm while playing with friends. He is in need of medical services, and so you take him to the nearby hospital. Doctors perform the work they think is necessary, you’re sent home with your child in a cast, and you later find out what the cost is. In what other industry do consumers tolerate having zero information about the price of services prior to agreeing to the work?
When you buy over the counter medicine, for example, you contrast and compare between available options. Perhaps you wish to pay a premium for a name brand, or you’re willing to choose a less ideal option to save money. You analyze the products based upon their price, their reputation, their ingredients, their claims of what they can help you with, and other factors. But the important thing is that you are provided all of the relevant data to make an informed choice.
When doctors and medical administrators uphold a system that hides prices from consumers, because of precedent or preference, individuals are unable to sufficiently compare and contrast and make an informed choice.
Utah has a long tradition of enjoying the theatrical arts. From the early days of the Salt Lake Theatre—the crown jewel of Western theaters—to the world famous Utah Shakespearean Festival, Utahns have valued wholesome entertainment for generations.
Within a few years after their arrival in the Salt Lake Valley, a devout pioneer populace eager to begin building their church’s temple were hungry for a little of the sweet life too. So, 31 years before completing a temple carved out of a mountainside, many hundreds of volunteers set to work on the red pine beams of the Salt Lake Theatre. At the time it was the grandest building in the territory and was considered by one outside observer to be “one of the Seven Wonders of the theatrical world.”
It attracted the likes of P.T. Barnum, Wild Bill, Al Jolson and scores of acting royalty. At a cost of $100,000 (a little over $2 million in today’s dollars) it required thousands of volunteer man hours to construct and primarily used reclaimed building supplies from the disbanded Camp Floyd and wagon wreckage from the trails around the territory. The Pioneer Theater was built in 1962 (at a smaller scale) to resemble the Salt Lake Theater (which was demolished in 1928) and cost about $1.5 million to construct (over $11 million in today’s dollars). It’s sobering to think what a comparable 1,500 seat venue would cost today.
“In levying taxes and in shearing sheep it is well to stop when you get down to the skin.” —Austin O’Malley, Keystones of Thought
Over the decades, Americans have been programmed to believe that they all must “pay their fair share” for the multitude of infrastructural provisions, assumed by lawmakers over the last century to be the responsibility of the state. “Fair share” means different things to different people; for some it’s a flat rate, for others it’s a dollar amount. Most tacitly agree that taxes are legal, necessary, and just. For this reason, it is difficult for principled arguments against taxation to gain solid footing, because we repeatedly and without much protest have allowed so many “reasonable” taxes. Precedent for taxation is further strengthened every day with the expansion of leviathan government into new market frontiers.
For the last 20 years one frontier to largely escape the pervasive reach of the tax man has been e-commerce. However, politicians have been foaming at the mouth in recent months at the idea of an internet sales tax. The last legislative session here in Utah saw SB 226, a sales tax on out-of-state internet transactions (sponsored by Republican Wayne Harper), advanced in the Senate despite concerns from legal counsel that the bill would likely not pass constitutional muster. It was later defeated in the House despite heavy lobbying from brick-and-mortar retailers like Schubach and RC Willey.
Why are legislators elected? For what purpose do they wield their power? Perhaps more fundamentally, what is the proper role of government?
These questions were all implied in a simple question I asked a few Senators last month during public comment on a controversial bill. The question I asked to each Senator on the committee was, simply, “Who are you?”
I further asked if they were lawmakers or economic developers. The reason for my clarifying question was to draw a sharp contrast between the two; too many legislators abandon the rule of law and focus on economic development, giving tax revenue, job creation, and related economic benefits far greater consideration in their analysis than more important things like whether they have the authority to do what they intend to at all.
And that’s the point I further emphasized, in relation to the bill in question—one which would have provided taxpayer dollars and tax-based incentives to help fund the creation of a mega hotel and convention center in Salt Lake City. “I understand there are compelling incentives and reasons to do so,” I said to the committee. “But I propose that you do not have the authority to do so.”
This may be a difficult article for many to read. We like our news spoon-fed and interpreted for us, broken down to the “nitty gritty” of what we think really matters. Rather than take the time to understand the causes of our present state, most simply want to know where we are heading and how to fix this mess we’re in. Those skilled in the art of statistical, economic, and political distillery are well aware of this general malaise and use it frequently to promote a particular agenda. In the spirit of full disclosure, I am trying to do the same. My motive, however, is to increase understanding and to encourage individuals to more stridently defend those rights that are naturally theirs.
When I was first introduced to what some call the “dismal science” in a university economics course, I was a bit confused by the jargon, equations, and the mental gymnastics necessary to arrive at (what can only ever be) an approximation of outcomes, based completely on the quality of the inputs. I say approximation because modern economics is concerned with mathematical models that attempt to quantify the aggregate effect of billions of interactions; any one of these interactions not performing as predicted could conceivably throw a wrench in the whole model. In other words, economic modeling has not arrived at a point where the random preferences of billions of people interacting can be mathematically predicted, so we’re stuck with a choice to:
- force the imperfect conclusions of a model on people who do not always act according to the desires of central planners; or
- allow individuals to make decisions freely in a marketplace of competing ideas, products, and services.
Undercover agents from the state liquor-control agency are busy conducting sting operations throughout the Wasatch Front. It reminds me of the days of prohibition when the FBI battled it out with gangsters like the infamous Al Capone. What is the current crime they are focusing on? Selling alcohol to minors? Nope. Selling illegal “moonshine”? Nope. Selling alcoholic beverages without a license? Nope. Selling alcoholic beverages with an alcohol content above the legal limit? Nope.
What could it be? Shockingly enough, there are restaurants with the audacity to commit the insidious crime of allowing patrons to sip an alcoholic beverage before they have ordered their food. Oh, the humanity! How unthinkable that this could be going on in our state right under our noses.
In all seriousness though, the state is taxing its citizens to pay to have undercover officers patrolling restaurants before and during the Sundance Film Festival, which begins on January 17. All this to prevent restaurant patrons from ordering drinks while they wait for their table or while they peruse the menu and decide what they will eat.
When will Utahns say enough is enough?
A recent dust up in Utah courts pitted African hair braiding specialist, Jestina Clayton, against the State of Utah, over a current statute that requires 2000 hours of cosmetology coursework to become a licensed hair braider. Clayton, 30, who learned how to braid at age five and has been practicing longer than most cosmetology students have been alive, won the case on the basis of her constitutional right to earn a living. The judge cited the lack of evidence for any threats to public safety as grounds for his decision.
Libertas Institute applauds U.S District Judge David Sam for this common sense and correct opinion. In doing so we recognize that while many can see the restrictive absurdity in making a hair braider take 2000 hours of coursework, there are many who still believe that some licensure is necessary for hair braiders and other common service providers. Enter Republican Rep. Jim Dunnigan, who wants to “reduce” the licensure requirement to 300 hours despite a judge’s opinion stating no credible threat to public safety exists. This all sounds well and good if all you’re trying to do is move the needle on bureaucratic overreach. However, we interpret the judge’s decision as a mandate for the legislature to remove this particular licensure provision completely or supply evidence that there is a threat to public safety—something no lobbyist or special interest has been able to do. We therefore support legislation, which we expect to be introduced in the 2013 general session, that will require state officials to demonstrate a clear public safety threat prior to imposing such burdensome regulations.
Just two months ago, a federal judge ruled in favor of a small businesswoman wishing to braid the hair of consenting customers without having to apply for a license and receive state-approved training with hundreds of hours of class instruction.
Today, the cosmetology industry began its push back against the ruling.
A Salt Lake Tribune article on the metamorphosis offers the reason given by those in charge. Director Patty Conner stated: ”For many people the word ‘exchange’ connotes government, and we want to remind Utah’s small business owners and their employees that we are built on free-market ideals.”
“Built on free-market ideals?” Who wielded the hammer, paid for the construction supplies, and poured the foundation? The government. Even the paragraph directly after Conner’s quote in the article obliterates her claim: