Economic FreedomEconomic Policy

“Right To An Honest Living” Bill Clears Committee, Heads to House

Rep. Richard Womack succeeded yesterday at getting his “Right To An Honest Living” bill out of the House Public Health, Welfare and Labor committee.
The bill, which would allow Arkansans to contest over-burdensome government regulations they feel harms their ability to work, escaped committee with the minimum 11 votes needed. It received bipartisan support.
The 11 votes in favor came from Reps. Wardlaw, Branscum, Meeks, Richey, Miller, Womack, Fite, Payton, Bentley, Sullivan and Linck.
The bill will now head to the House floor for a vote Monday afternoon.
This bill has attracted the attention of armies of special interest groups across the state.
Under Arkansas’s current system, industry boards made up of industry professionals get to regulate their own industry. Unsurprisingly, industry lobbyists like this system, because it keeps out competition via regulation.
This bill would allow average Arkansans to contest the ill-founded regulations that abound in Arkansas. As we’ve previously noted, Arkansas has the second most burdensome licensing laws and is the fifth most extensively and onerously licensed state, according to the Institute for Justice.
From the Institute for Justice:

The high ranking is driven mainly by the five years of education and experience required for many of the construction trades. Workers in other states are required to undergo only between 507 days (sheet metal workers) and 390 days (insulation contractors) of training to get a job in the same occupations, on average. Many states either do not have training requirements or do not require a license at all.
Arkansas licenses a number of occupations that few other states do, such as funeral attendants, psychiatric technicians and residential dry wall installers. Moreover, many occupations are subject to entry restrictions that exceed national averages. Opticians in Arkansas, for instance, must train for more than three years, about a year more than the national average. Fire alarm installers lose 1,095 days to education and experience requirements versus a national average of 486 days.
Thirty occupations take longer to break into in Arkansas than emergency medical technician, most by a considerable margin. The state allows EMTs to work in ambulances after 28 days of training. Massage therapists, on the other hand, are required to complete 117 days of training. Barbers and cosmetologists must obtain 350 days of training.

David “Mitch” Mitchell, an assistant professor of economics at the University of Central Arkansas, told the committee yesterday about the harm of overregulation to Arkansas’ economy:

We say that Arkansas is a “Right To Work” State, but it’s not a “Right To Work” state. Arkansas has more occupation licensing than any of our neighbors and any of our Southern states. Arkansas requires that 128 occupations be licensed…compared to Missouri at 41. Kansas (with) 56 and New York (with) 77.
If Arkansas reduced its low-wage licensing just to the rate of Missouri, we could add 8, 668 more jobs in the state of Arkansas. That’s alot of jobs. That would reduce our unemployment rate from 5.7 percent to 5.1 percent. Further, our research shows that if we reduce our occupation licensing to that of Missouri that African-American poverty rates would fall by 5.3 percent. Also, 22,773 people would be raised out of poverty. That’s exciting stuff so passing this bill will empower Arkansans, because it will help reduce unnecessary and inappropriate licensing.

The main objection from this bill’s critics is that it will lead to the state having to defend tons of frivolous lawsuits.This objection isn’t based in reality.
Frivolous lawsuits, as Womack said at the hearing last week, shouldn’t be caused by this bill, because the only reward for a successful court challenge of an occupational regulation is the right to perform a job free of unreasonable regulations. The defendant wouldn’t receive any monetary damages from state taxpayers because of a successful challenge.
Furthermore, as a technical matter, the number of lawsuits that would be produced by this bill is zero. This bill only creates a defense to a regulatory enforcement action, so its real force is to make regulators pull back, check themselves, take a second look at their actions, and/or ensure that their regulatory enforcement remains inside reasonable boundaries.
As I said earlier, this bill will likely be up for a vote in the House next week. Lots of legislators in the House talked during the campaign about creating jobs and making it easier for average Arkansans to earn a living. The vote on this bill will give voters a chance to see if they were serious or not.

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