Posted 8:21 pm Friday, November 16, 2012
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Licensing trades hurts competition
Chances are, if you’re reading this, you’re not a resident of many parts of New York City, Long Island, and New Jersey. It’s not just about the Tyler Paper’s circulation area; it’s about electrical power.
More than two weeks after Hurricane Sandy blew ashore, thousands and thousands of people are still without power. There’s a reason for that. Beyond the reports of non-union power crews from other states being turned away, the main culprits in the sluggish restoration of power are a government-run, politicized and inefficient Long Island Power Authority — and occupational licensing.
“As the power outages on Long Island drag on, New Yorkers railed Sunday against the utility that has lagged behind others in restoring power, criticizing its slow pace as well as a dearth of information,” CBS News reports. “Perhaps none of the utilities has drawn criticism as widespread, or as harsh, as the Long Island Power Authority.”
As of mid-week, more than 75,000 LIPA customers were without power.
“By comparison, Con Edison reports 1,469 customers without power in New York City and Westchester County,” CBS adds. “In New Jersey, PSE&G reports 99.9 percent of the 1.7 million customers impacted by Sandy have had their power restored.”
What makes LIPA special? One incident reported by the New York Post illustrates the situation as succinctly as any statistic.
“A Long Island Power Authority official told a crowd of 300 Rockaway residents that they would need to hire a licensed city electrician to inspect their homes before LIPA could restore power, and suggested the homeowners print out inspection forms — from the Internet,” the Post reported.
The crowd then shouted back, “But we don’t have power!”
More than two weeks after Hurricane Sandy blew ashore, thousands and thousands of people are still without power. There’s a reason for that. Beyond the reports of non-union power crews from other states being turned away, the main culprits in the sluggish restoration of power are a government-run, politicized and inefficient Long Island Power Authority — and occupational licensing.
“As the power outages on Long Island drag on, New Yorkers railed Sunday against the utility that has lagged behind others in restoring power, criticizing its slow pace as well as a dearth of information,” CBS News reports. “Perhaps none of the utilities has drawn criticism as widespread, or as harsh, as the Long Island Power Authority.”
As of mid-week, more than 75,000 LIPA customers were without power.
“By comparison, Con Edison reports 1,469 customers without power in New York City and Westchester County,” CBS adds. “In New Jersey, PSE&G reports 99.9 percent of the 1.7 million customers impacted by Sandy have had their power restored.”
What makes LIPA special? One incident reported by the New York Post illustrates the situation as succinctly as any statistic.
“A Long Island Power Authority official told a crowd of 300 Rockaway residents that they would need to hire a licensed city electrician to inspect their homes before LIPA could restore power, and suggested the homeowners print out inspection forms — from the Internet,” the Post reported.
The crowd then shouted back, “But we don’t have power!”
According to the Post, there aren’t “enough licensed electricians in the city of New York to take care of this.”
At that same meeting, residents asked if they could use electricians from adjoining counties to inspect their homes.
They were told no. The reason is local occupational licensing. There are two things wrong with that sentence: local, and occupational licensing.
First, cities such as New York that establish their own licensing systems, with requirements over and above (or simply different than) state licensing laws aren’t ensuring the safety of their residents. They’re protecting the monopolies within their city limits. They drive up prices and reduce the quality — or even availability — of services.
As Walter Olson of the Cato Institute observes, “In a sane world, if occupational licensure existed at all, it would be automatically relaxed at a time of extremity like this, with lives as well as gigantic economic damage at risk. But this is New York, where apparently even the protectionist exclusion of qualified electricians who hold licenses in the next county over can’t be waived.”
But licensing laws themselves are suspect; they make sense for some trades (doctors, for example). But many New York homeowners are waiting for downed trees to be cut up and hauled off, for example. And that requires a licensed contractor.
When the debris and devastation of Sandy are cleared away, Olson says, so should obsolete occupational licensing rules.
At that same meeting, residents asked if they could use electricians from adjoining counties to inspect their homes.
They were told no. The reason is local occupational licensing. There are two things wrong with that sentence: local, and occupational licensing.
First, cities such as New York that establish their own licensing systems, with requirements over and above (or simply different than) state licensing laws aren’t ensuring the safety of their residents. They’re protecting the monopolies within their city limits. They drive up prices and reduce the quality — or even availability — of services.
As Walter Olson of the Cato Institute observes, “In a sane world, if occupational licensure existed at all, it would be automatically relaxed at a time of extremity like this, with lives as well as gigantic economic damage at risk. But this is New York, where apparently even the protectionist exclusion of qualified electricians who hold licenses in the next county over can’t be waived.”
But licensing laws themselves are suspect; they make sense for some trades (doctors, for example). But many New York homeowners are waiting for downed trees to be cut up and hauled off, for example. And that requires a licensed contractor.
When the debris and devastation of Sandy are cleared away, Olson says, so should obsolete occupational licensing rules.
