“One of the penalties of not participating in politics is that you will be governed by your inferiors.” Plato

John Stossel
Entrepreneurs Under Attack
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Sign-Up  Every day, federal, state and local governments stifle small businesses to privilege well-connected incumbent companies. It’s a system of protectionism for influential insiders who don’t want competition. Every locality has its share of business moguls who are cozy with politicians. Together, they use the power of government to keep competition down and prices high.

The Institute for Justice, a libertarian public-interest law firm, works to free entrepreneurs from such opportunity-killing regulations. Here are four cases from IJ’s files.

Case No. 1. The monks at St. Joseph Abbey had to take the state of Louisiana to federal court to defend their right to make money selling handmade caskets. That’s right: empty wooden boxes. But as soon as the monks started selling them, they were shocked to receive a cease-and-desist order from something called the Louisiana State Board of Funeral Directors. The funeral directors had managed to get their state to pass a law decreeing that only “licensed funeral directors” may sell “funeral merchandise” like caskets. To sell caskets legally, the monks would have to obtain a funeral director’s license. That required a year-long apprenticeship, passing a funeral industry test and converting their monastery into a “funeral establishment” by installing embalming equipment, among other things.

The state board and the Louisiana Funeral Directors Association — the profession’s lobbyist — say the law is designed to protect consumers. But that’s what established businesses always say about absurd regulations they demand. An unusually candid funeral director told The Wall Street Journal, “They’re cutting into our profit.” Well, yes, free competition does do that. That’s the point.

Another funeral director said that the law must remain unchanged because casket-making is a complicated business: “A quarter of America is oversized. I don’t even know if the monks know how to make an oversized casket.” Does that even deserve a comment?

Case No. 2. Hector Ricketts wants to offer New York City residents an alternative to New York’s slow and clumsy public transportation. He employs drivers who offer commuters rides in minivans. The vans serve mostly low-income neighborhoods and typically charge $2 a head. People like the vans. They’re more convenient than unionized government-run public transit — and cheaper, too. The subways and buses charge $2.25.

So the city’s public transit union used its political connections to regulate the vans to death: The politicians have decreed that vans may not drive routes used by city buses or provide service to a passenger unless it is prearranged by phone; and the vans must keep a passenger manifest on board and enter the name of everyone to be picked up.

“Government makes it easier to get on welfare than to grow my business,” Ricketts says.

The fight continues.

Case No. 3. Melony Armstrong of Tupelo, Miss., wanted to expand her African hair-braiding business. But Mississippi bureaucrats told her that to teach workers how to braid she needed a full cosmetology license. That required 1,200 hours of classes. Next, she needed a cosmetology instructor’s license — 2,000 more hours.

The courses and license had little to do with her profession. They were simply barriers to entry favored by her competition. Fortunately, IJ won that case.

Case No. 4. Dennis Ballen has a bagel shop located far off the main roads in Redmond, Wash. He couldn’t afford to advertise on radio or TV, so he paid someone (typically unemployable people with quirky personalities) to stand on the road with a sign directing traffic to his store. It worked. The sign brought him two or three new customers a day.

Then Redmond police slapped him with a cease-and-desist order, warning he could face a year in jail or up to $5,000 in fines if he didn’t stop displaying the sign. Ballen estimates that he would lose at least $200 a day in business if he complied. He and IJ sued the city and won the right to employ the sign-holder.

It’s great that IJ and some determined entrepreneurs win a few victories for free enterprise. But in a country with a real free market, such lawsuits would be unnecessary.

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Michelle Malkin
Obama’s $50 Billion Union Infrastructure BoondogglePresident Obama calls his latest attempt to revive the economy a “Plan to Renew and Expand America’s Roads, Railways and Runways.” I’m calling it “The Mother of all Big Dig Boondoggles.” Like the infamous “Big Dig” highway spending project in Boston, this latest White House infrastructure spending binge guarantees only two results: Taxpayers lose; unions win.

The plan would add at least $50 billion more to the nearly $230 billion already allocated in the original trillion-dollar stimulus law for infrastructure. Less than one-third of that infrastructure stimulus money has been spent, but the urgency to pile on has increased exponentially as the midterm elections approach and unemployment hovers near 10 percent. So, the president says he wants to “put people back to work” through a new “upfront investment” in surface transportation, airports and the air-traffic control system paid for by repealing tax incentives for the oil and gas industries — followed by massive, unpaid-for expenditures on pie-in-the-sky high-speed rail, “environmental sustainability” and “livability,” whatever that means.

Obama spoke emotionally at an AFL-CIO rally on Labor Day about unemployed construction workers. A “lot of those folks, they had lost their jobs in manufacturing and went into construction; now they’ve lost their jobs again,” he said. “It doesn’t do anybody any good when so many hardworking Americans have been idled for months, even years, at a time when there is so much of America that needs rebuilding.”

But here’s the rub: Not all workers are equal in Obama’s eyes. And most of them will remain “idled” by the Democrats’ own design. The key is E.O. 13502, a union-friendly executive order signed by Obama in his first weeks in office, which essentially forces contractors who bid on large-scale public construction projects worth $25 million or more to submit to union representation for its employees.

The blunt instrument used to give unions a leg up is the “project labor agreement (PLA),” which in theory sets reasonable pre-work terms and conditions — but in practice, requires contractors to hand over exclusive bargaining control; to pay inflated, above-market wages and benefits; and to fork over dues money and pension funding to corrupt, cash-starved labor organizations. These anti-competitive agreements undermine a fair bidding process on projects that locked-out, nonunion laborers are funding with their own tax dollars. And these PLAs benefit the privileged few at the expense of the vast majority: In the construction industry, 85 percent of the workforce is nonunion by choice.

We don’t need to theorize about how this shakedown works in the real world. Boston’s notorious Big Dig was a union-only construction project thanks to a Massachusetts government-mandated PLA. The original $2.8 billion price tag for the project skyrocketed to $22 billion in state and federal taxpayer subsidies thanks in no small part to ballooning labor costs. In February, the Bay State’s Beacon Hill Institute found that PLAs added 12 percent to 18 percent to school construction costs in Massachusetts and Connecticut. In Washington, D.C., the Department of Veterans Affairs commissioned an independent study showing that PLAs would increase hospital construction costs by as much as 9 percent in some markets.

In short, Obama’s new Union Infrastructure Rescue Plan is a political favoritism scheme that raises the cost of doing business and bars tens of thousands of skilled, nonunion laborers who choose to run open shops from securing work. In the name of patching up America’s highways and byways, Mr. Fix It would create another gaping fiscal sinkhole to appease his special interest donors. Recovery Summer turns to Union Payback Fall.

Boehner Statement on President Obama’s Latest ‘Stimulus’ Spending Proposal

 

Washington, Sep 6 -
House Republican Leader John Boehner (R-OH) issued the following statement on the latest ’stimulus’ spending plan President Obama will outline later today with remarks in Milwaukee, WI:

 

“As the American people, facing near double-digit unemployment, mark Labor Day by asking, where are the jobs, the White House has chosen to double-down on more of the same failed ’stimulus’ spending. Eighteen months ago, the Administration promised that if we passed their trillion-dollar ’stimulus’ it would create jobs ‘immediately’ and keep unemployment below eight percent. Instead, millions of Americans have lost their jobs, and unemployment is approaching 10 percent. If we’ve learned anything from the past 18 months, it’s that we can’t spend our way to prosperity.  We don’t need more government ’stimulus’ spending - we need to end Washington Democrats’ out-of-control spending spree, stop their tax hikes, and create jobs by eliminating the job-killing uncertainty that is hampering our small businesses.”