Wednesday, September 08, 2010

Why Does Government Stifle Competition?

The monks at St. Joseph Abbey had to take the state of Louisiana to federal court to defend their right to make money selling handmade caskets. That's right: empty wooden boxes. But as soon as the monks started selling them, they were shocked to receive a cease-and-desist order from something called the Louisiana State Board of Funeral Directors. The funeral directors had managed to get their state to pass a law decreeing that only "licensed funeral directors" may sell "funeral merchandise" like caskets. To sell caskets legally, the monks would have to obtain a funeral director's license. That required a year-long apprenticeship, passing a funeral industry test and converting their monastery into a "funeral establishment" by installing embalming equipment, among other things.

The state board and the Louisiana Funeral Directors Association -- the profession's lobbyist -- say the law is designed to protect consumers. But that's what established businesses always say about absurd regulations they demand. An unusually candid funeral director told The Wall Street Journal, "They're cutting into our profit." Well, yes, free competition does do that. That's the point...


John Stossel has a few more choice examples of how government serves their well-entrenched, deep-pocket business pals by forcing new entrepreneurs out of the arena altogether. As he says, "It's a system of protectionism for influential insiders who don't want competition. Every locality has its share of business moguls who are cozy with politicians. Together, they use the power of government to keep competition down and prices high."

It's yet another case of government dis-serving the people.