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Who Can We Trust To Shut-Down Honest Work?

Over-enforcement has become all too common when it comes to youthful attempts at entrepreneurship.  Take for example an for The Telegraph, where a man named Andre Spicer wrote about the experience of his five-year-old daughter who tried to open a small lemonade stand in the family’s East London neighborhood.

After about 30 minutes, four local council enforcement officers stormed up to her little table,” he wrote. “‘Excuse me,’ one officer said as he switched on a portable camera attached to his vest. He then read a lengthy legal statement – the gist of which was that because my daughter didn’t have a trading permit, she would be fined [$195]. ‘But don’t worry, it is only [$117] if it’s paid quickly,’ the officer added.”
Spicer later wrote: “My daughter burst into tears, repeating again and again ‘have I done a bad thing’?”

Before one becomes tempted to think such things only happen in Europe, I’ll point to Mowing the lawn for a neighbor, watching a friend’s pet, helping a deaf person communicate, and many other simple tasks can result in sharp fines in many states if one accepts monetary compensation without the appropriate permit (which is often quite expensive).

Who Are These Laws For?

As Adam Smith wrote in The Wealth of Nations:

The interest of the dealers, however, in any particular branch of trade or manufactures, is always in some respects different from, and even opposite to, that of the public. To widen the market and to narrow the competition, is always the interest of the dealers.”

Worse yet, such regulations impede entrepreneurship and teach the wrong lessons to people seeking to make their way in life.

Ronald Reagan once observed that, “Entrepreneurs and their small enterprises are responsible for almost all the economic growth in the United States.”

Last week, I had to be in Washington DC and all tourists taking a stroll around the national monuments on the Mall saw hundreds of venders selling drinks out of coolers.  In the 100 degree weather it was welcomed – but not by everyone.   A group of teenagers sitting handcuffed and detained on the sidewalk for the offense of selling bottled water without first asking the government for a permit (permission).

Just a week prior to this situation, a similar instance occurred in the neighboring city of Baltimore, Maryland. A group of young children, still donning their school uniforms from earlier in the day, were selling snow cones in their community, until police shut them down for not obtaining the proper permits. While these young children were fortunate enough to not have been placed in handcuffs, this national crackdown on child-run businesses is having a far worse impact on the communities where the self-sustaining entrepreneurial spirit is needed the most.

Whether it’s selling lemonade on a neighborhood street corner or, like the young men detained in DC this weekend, selling cold bottles of water to overheated tourists, local law enforcement has cracked down and penalized minors who would dare start a business without first obtaining a government license. City officials and police officers claim that this measure is taken to ensure of public safety and to make sure that society only receives quality products.  The truth is that not only are these licensing laws not doing anything substantial to actually protect consumers, they are disproportionately impacting the ability of all people not just the young to create a living or of innovating and cultivating a spirit entrepreneurship.

Industry, free exchange, and entrepreneurship seem like virtues an aspiring society would wish to foster in their young. Alas, more often those with money and power aim to shut down competition by others in society to protect the control that they currently retain.  Thus the explosion of unnecessary regulation and laws.  As Benjamin Franklin explained, “Those that choose security over liberty, deserve neither.”

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