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During the hot summer months, it’s practically an American tradition for children to set up lemonade stands in their neighborhood. The children learn valuable skills on how to run a business while earning some extra summer cash. A few years ago, the image of bureaucrats forcibly shutting down innocent lemonade stands may have been satire. Not anymore. The out of control nanny state has targeted all business owners—even if the entrepreneur happens to be a 7 year-old girl selling lemonade.
On July 29, Julie Murphy committed the “heinous crime” of selling lemonade for 50 cents a cup at an arts fair in Portland. Since the young entrepreneur did not have a temporary restaurant license costing $120, the county health inspectors threatened to fine her $500 if she did not leave. Even after offering the lemonade for free and for donation only, the county officials shut down her lemonade stand. While Julie left the fair in tears, hopefully her entrepreneurial spirit was not broken by these harsh government regulations.
According to environmental health supervisor John Kawaguchi,
I understand the reason behind what they're doing and it's a neighborhood event, and they're trying to generate revenue. But we still need to put the public's health first.
the fact that you’re small-scale I don’t think is relevant.
This is just one of countless examples of how needless fees and regulations have stifled entrepreneurship. Due to media attention and public outrage, the county health department has since backed away from the issue and apologized to Julie Murphy. However, stories similar to the government shutting down Julie Murphy’s lemonade stand are far too common.
Over the years, the Institute for Justice has done excellent work defending business owners whose economic liberties have been infringed by overreaching government regulations. For centuries, individuals have immigrated to America to pursue their entrepreneurial dreams. All too often, these dreams have been crushed by strict licensing requirements.
Here are just a few ridiculous licensing requirements that entrepreneurs face around the country: In Florida, it is illegal to work as an interior designer without proper government licensing. Even if the designer has a college degree in the field, performing interior design services without a license is punishable by up to a year in jail or $1,000 in fines. In Texas, it is prohibited to thread eyebrows—an alternative to eyebrow waxing—without obtaining an irrelevant state license. In order to legally perform this ancient Indian art, eyebrow threaders are now required to spend 1,500 hours in a government-approved cosmetology school costing $20,000 that does not even teach the skill. Furthermore, in Texas, every computer repair technician must obtain a degree in criminal justice or have a three-year apprenticeship under a licensed private investigator to legally fix computers. Computer repair technicians face $4,000 in fines, a $10,000 civil penalty and up to one year in jail if they do not have an extraneous criminal justice degree.
Simply, compulsory licensing is used to restrict competition in a marketplace. Well-funded industry cartels lobby for strict licensing requirements that make it difficult for newcomers to sell their competing product or service. These harsh licensing laws are harmful to both entrepreneurs and consumers. Would-be entrepreneurs who cannot afford the high cost of licensing will not have the opportunity to operate their business. As a result, there will be fewer employment opportunities and consumers will be forced to pay higher prices for goods and services with less variety. If the government is willing to shut down a little girl’s lemonade stand, how far are they willing to go to infringe on our economic liberties?