Don’t Create Red Tape When Markets Will Suffice

The ultimate question applying to a host of professions discussed in the Legislature this session is: “What level of regulation is needed?”

In the ongoing debate over regulatory reform, lawmakers in Nebraska have often forgotten that not having any formal government oversight is often a viable option.  Sen. John Kuehn summed it up perfectly when he said during debate on a bill related to horse massagers, “Let’s not create red tape for the sake of creating more red tape.”

There are three main categories of occupational regulation.  First are private governance options, which means the private market will self-regulate through market competition or consumer service rating organizations. Second would be public regulation, which includes government inspections, mandatory bonding or insurance, and trade practice laws.  The last is government control including registration, certification and the most restrictive, licensing.

Three pieces of legislation come to mind immediately for which getting the state out of the profession entirely was the original goal.  One bill was introduced to exempt reflexology, a type of relaxation care where the practitioner only touches and moves the feet and hands, from the state’s massage law.  Another bill was filed to eliminate the Farm Labor Contractors license which was implemented decades ago before the federal government had its own registry for this profession.  And most recently, the Legislature held first round debate on LB596, which would exempt horse massagers from an excessive licensing law.
 

In each case, convincing lawmakers that getting out of the way was the right option has been a tough row to hoe. 

Reflexology is a particularly great example.  It has been exempted from regulation in over 30 states. But in Nebraska, due to pressure from the massage therapy board, the reflexology profession has gone through a grueling credentialing review process at the Department of Health and Human Services in an effort to lower their regulatory burden.
 

Farm Labor Contractors currently comply with an expensive and outdated license because their bill was never voted out of committee.  And horse massage might end up with a new state registry, which while less than their current burden, is a policy many senators agree is not needed to protect the public.

Of course, some occupations require government oversight.  Nobody wants an unqualified surgeon performing an operation on them or a family member. But in the case of reflexology, horse massage or a farm labor contractor there isn’t a public safety concern.  If someone is bad at performing these trades, their work will speak for itself and that person’s work opportunities will shrink until they are pushed out of the market.  In the internet age there are multiple third-party consumer organizations such as the Better Business Bureau, Good Housekeeping, and the Consumers Union that have provided consumers with information on the quality of occupational practitioners for over a century.

By always following the impulse to “do something,” lawmakers can create red tape that is of no real value to the public.  Instead, legislators need a constant reminder that “doing nothing” often enables consumers and entrepreneurs to do the real work of providing tools for assuring quality services.