Sandy, LIPA and the Occupational Licensure Blues

Hurricane Sandy, an enormous disaster from the outset, has become a much worse one due to the painfully slow restoration of power and supplies to storm-ravaged New York City, Long Island, New Jersey, and neighboring areas. Per CBS,

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.

That utility is LIPA, the Long Island Power Authority, and as its name implies LIPA is not a private company but an agency of New York State with a long history of being used by New York politicians to pursue their goals. I will leave to other critics the question of how LIPA’s history as a public-sector entity has influenced its capabilities for disaster response but per a New York Post account, local residents don’t seem impressed with its performance:

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.

“But we don’t have power!” the crowd shouted back at LIPA’s vice president of operations, Nicholas Lizanich. …

“On a scale of zero to 100, I give [LIPA] a zero,” grumbled homeowner Jim Silvestri, who asked whether he could use a Nassau County-certified electrician and was told no.

“There’s not enough licensed electricians in the City of New York to take care of this,” he added.

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.

It’s at a time of disaster that the irrationality of so many market-blocking rules, licensure among them, becomes most obvious. In a splendid report issued by the Institute for Justice in May, License To Work: A National Study of Burdens from Occupational Licensing, by Dick M. Carpenter II, Lisa Knepper, Angela Erickson (formerly of Cato) and John K. Ross examine what should be the most dispensable tranche of occupational licensure laws, those for occupations like bartender, shampooer and animal trainer, typically lower-income and often somewhat entrepreneurial that are licensed in some but not all of the fifty states. Usually, the result is a controlled real-world demonstration that without the legal restriction of a given trade, life just goes on normally.

Of the 102 low-income occupations they examine, one with an obvious nexus to disaster recovery is tree trimmer, an occupation licensed in just 7 states. My own state of Maryland, I’m sorry to report, not only demands a license for such work but is quite burdensome about it, requiring “three years of training – two years of education and one year working in the field – for a ‘tree expert’ license.” Without such a license it is unlawful to accept compensation for “trimming, pruning, thinning, cabling, shaping, removing, or reducing the crown of” a tree 20 feet or higher. Three states that suffered extensive tree downage from Sandy – Maryland, Connecticut and Rhode Island – forbid unlicensed tree trimming, although many a property owner would probably have appreciated the legal right to hire someone from a neighboring state to clear a blocked driveway.

After the Sandy cleanup, we could use a cleanup of some of the deadweight laws that block the path of liberty and self-organizing economic prosperity.