Freedom, Society, and State - Ludwig von Mises Institute

to ···enter a lIcensed field without government permission,
libertarians see it as violating natural law by
employing violence to prevent nonaggressive actions of
other individuals. In fact, occupational licensing is
seen as a return to a type of guild system similar to
that of the feudal period,(37) and libertarians call
for the removal of all forms of government regulations,
from the licensing of occupations to the prohibition of
private drug use.(38)
The moral issue aside, the practical problem with
go v ernmen t lieens i ng i s t hat wh e the r i t wa s 0 rig ina I I Y
implemented to regulate industry for the benefit of the
consumer or was established to benefit entrepreneurs by
shielding them from competition is irrelevant. Since
the interest of "the public" is diverse and diffuse it
is unable to focus its interests on any particular
pro b I emf 0 r a sus t a i ned per i 0 d 0 f time • On the 0 the r
hand, the interest of an industry is "direct and focused."
The automobile industry, for example, has a dir
e etand i mme d iate in t eres tin the dec i s ion S 0 f the Environmental
Protection Agency. But individual members
of the pUblic are affected only minimally. Hence, the
automobile industry would be willing to devote much
time and energy to influence the agency's decisions
while the "public" will not. Moreover, since an agency
cannot make decisions concerning the industry it regulates
unless it possesses knOWledge about that industry,
the agency officials must either be drawn from the
very industries they regulate or develop close contacts
with those in the industry. It is hardly surprising,
notes economist Milton Friedman, that the regulatory
" 0 r g ani z a t ion s h a v e beeom e the s e r van t s 0 f thosethey
were supposed to protect the public from."(39) Walter
Gellhorn, in fact, estimates that
Seventy-five percent of the occupational
licensing boards at work in this country
today are composed exclusively of licensed
practitioners in the respective occupations.
The s e men and worn en, m0 S t 0 f wh am are 0 n I y
part-time officials, may have a direct economic
interest in many of the decisions they
make concerning admiSSIon requirements and
the defInition of standards to be observed by
licensees. More importantly they are as a
rule directly representative of organized
groups WIthin the occupations.(40)
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