Category: Regulations

Washington, D.C. Regulators Protect Citizens from Goat Yoga

GoatYogaInGlendaleCalifornia2017-10-09.jpg“Goat yoga has spread nationwide since last year. Practitioners in Glendale, Calif., in May.” Source of caption and photo: online version of the WSJ article quoted and cited below.

(p. A1) WASHINGTON–Young goats have on occasion grazed in the Historic Congressional Cemetery, deployed to keep down brush. A yoga instructor has been holding weekly classes in the chapel.

Goats and yoga go together, as any modern yogi knows. So, cemetery staff proposed this spring, why not combine them and bring inner peace to all on the grounds?
“I asked the farmer if there’s any harm to the goats doing yoga,” says Kelly Carnes, who teaches the discipline on the cemetery grounds. “She said quite the opposite–the baby goats just love to interact with humans.”
Gruff was the response from District of Columbia officials. District policy, they decreed, prohibited the human-animal contact goat yoga presented: “At this time the request for the event with the inclusion of baby goats has been denied.”
. . .
(p. A12) This spring at the Congressional Cemetery, Ms. Carnes read about goat yoga and raised the idea with participants in her “yoga mortis” classes at the cemetery. They were “crazy to try it,” she says.
She spoke with Paul Williams, president of the nonprofit that manages the cemetery, about trying it with the goats they had twice hired over the past several years to eat down unwanted plants.
The cemetery planned to hold goat classes in a pen in a grassy area. In June, Mr. Williams sought permission from the health department.
The “no” came that month. The capital’s health code, says Dr. Vito DelVento, manager of the District of Columbia Department of Health’s animal-services program, bans animals beyond common household pets from within district limits.
. . .
Then there’s Washington’s “no touch” policy barring direct contact between humans and animals beyond household pets.
“Baby goats are probably one of the most fun animal species–they are a blast,” says Dr. DelVento, who has farm animals outside the District and has raised goats. “But the fact that we have baby goats jumping on people and interacting with people obviously violates our ‘no touch’ policy.”
Mr. Williams says he will try again next year when Mrs. Bowen has a fresh herd of kids. He will seek a no-touch-policy exemption.
“We’re really trying to offer a service,” says Mrs. Bowen, “that is good for people’s mental health and physical health.”

For the full story, see:
Daniel Nasaw. “The Kids Are Not Alright: Bureaucrats Buck Goat Yoga.” The Wall Street Jounal (Sat., OCT. 2, 2017): A1 & A12.
(Note: ellipses added.)
(Note: the online version of the story has the date OCT. 1, 2017, and has the title “Goat Yoga, Meet the Zoning Board.”)

Wisconsin Regulators Protect Consumers from Delicious Imported Kerrygold Butter

(p. A3) Attorneys with the Wisconsin Institute for Law and Liberty are taking the state to court over a 1953 law that mandates all butter sold in Wisconsin be graded and labeled on factors such as flavor, texture and color by state-licensed tasters.
Those convicted of selling unlabeled butter in the state more than once could pay up to $5,000 in fines and spend a year in county jail.
The statute has enraged devotees of the popular Kerrygold brand of butter, which is produced in Ireland and hasn’t been tested by the state. Local retailers say their inability to sell the grass-fed, gold-packaged spread has affected their bottom line. WILL is representing four consumers in counties across Southeast Wisconsin in the suit, as well as a health-food store in Grafton.
“I think the issue is important because it’s a specific instance of a larger problem,” Rick Esenberg, WILL President and lead counsel, said of the obscure, 64-year-old ordinance. “The government should not restrict our liberties–particularly our ability to engage in a legitimate business and make a living.”
. . .
Wisconsin laws have shielded the dairy industry from out-of-state competition for decades, but have often crumbled under judicial scrutiny.
The Wisconsin Supreme Court in 1927 ruled unconstitutional a law prohibiting the sale of oleomargarine and other butter substitutes in the state, and in 1952 turned back an attempt to ban the sale of Dairy Queen soft-serve.
In 1895, Wisconsin forbade the sale of artificially colored margarine, forcing neighbors to pool funds and make “oleo runs” to the Illinois border to buy yellow-hued margarine in bulk. That law wasn’t repealed until 1967.
A half-century later, Wisconsin residents are now embarking on similar Midwestern voyages to stock up on Kerrygold.
“It has a richness to it and a taste to it that’s uncomparable to the other butters,” said Jean Smith, an avid consumer of Kerrygold and one of the plaintiffs in the Wisconsin suit.
Ms. Smith especially enjoys adding the Irish butter to her tea on mornings when she doesn’t have time for a full breakfast, and is a member of a Facebook group where neighbors keep each other abreast of the few Wisconsin stores supplying Kerrygold.
She buys the product whenever she travels out of state, picking up roughly a dozen bricks of butter on two trips to Nebraska this summer and then again when visiting Montana in May for her nephew’s graduation.
“The fact that I have to do that is absolutely ridiculous,” Ms. Smith said. “If it’s not related to safety, it’s not the government’s decision whether they should offer a product or not.”

For the full story, see:
Quint Forgey. “Wisconsin Lawsuit Aims to Whip Butter Statute.” The Wall Street Journal (Sat., Aug. 31, 2017): A3.
(Note: ellipsis added.)
(Note: the online version of the story has the date Aug. 30, 2017, and has the title “Wisconsin Lawsuit Aims to Cut Through Butter Laws.” Of the last eight short paragraphs quoted above, the first and third appear in both the online and the print version of the article. The rest only appear in the online version.)

“We Grow at Night, While the Government Sleeps”

HarareNightStreetMarket2017-09-10.jpg“In Harare, unauthorized street vendors wait until dark to avoid the police. The government says 95 percent of the work force is involved in the informal economy.” Source of caption and photo: online version of the NYT article quoted and cited below.

I remember my Wabash College economics professor, Ben Rogge, telling us that during one of his visits to Brazil, many decades ago, he asked an entrepreneur how the Brazilian economy managed to grow in spite of the heavy government regulations. With a smile, the entrepreneur told Ben: “We grow at night, while the government sleeps.”

(p. 6) HARARE, Zimbabwe — Dusk falls and thousands of vendors fan out across central Harare. Through the night, they hawk their wares — vegetables, clothes, kitchen utensils, cellphones — from carts, wheelbarrows or even the pavement, transforming the city’s staid business district into a giant, freewheeling village market.

On Robert Mugabe Road, around the corner from the city’s remaining colonial-era luxury hotel, the Meikles, Victor Chitiyo has sold dress shirts since losing his job as a machine operator at a textile factory several years ago.
“Since then, I’ve never been employed,” Mr. Chitiyo, 38, said under the dim light of a street lamp. “If the economy improves, I’d want to be employed at a company again. But I don’t think that will happen. It’s been a long time since we were optimistic in Zimbabwe.”
Harare’s night market is the most visible evidence of Zimbabwe’s swelling informal economy, which the government estimates now employs all but a small share of the country’s work force.
Even as Zimbabwe’s government, banks, listed companies and other members of the formal economy lurch from one crisis to another, the thriving informal economy of street vendors, traders and others unrepresented in official statistics helps keep the country afloat. For the government of President Robert Mugabe, that parallel economy is both a source of stability — and a potential challenge.
Once one of Africa’s most advanced economies, Zimbabwe has rapidly deindustrialized and shed formal wage-paying jobs, forcing millions like Mr. Chitiyo to hustle on the streets in cities and towns.
From 2011 to 2014, the percentage of Zimbabweans scrambling to make a living in the informal economy shot up to an astonishing 95 percent of the work force from 84 percent, according to the government. And of that small number of salaried workers, about half are employed by the government, including patronage beneficiaries with few real duties.
. . .
The government has occasionally cracked down — sometimes violently — on the street vendors, who are not licensed, describing their activities, near the seat of government and businesses, as an eyesore. Some of the vendors have also staged protests against Mr. Mugabe’s rule.
But the government mostly turns a blind eye, clearly calculating that a permanent crackdown on the livelihoods of an increasing number of its citizens would result in greater political instability. According to an unspoken rule, the street vendors are allowed to operate only after dark on weekdays and starting in late afternoon on weekends.
“If I come too early, the police will take my wares away and I’ll be broke,” said Norest Muza, 28, who sold popcorn and chips while carrying her 2-year-old son on her back. “Evenings, the police don’t come.”
Many of the street vendors arrive in Harare’s business district at dusk and spend the night on the streets before going home at dawn with the morning’s first taxis and buses.
. . .
Mr. Mugabe’s violent seizure of white-owned farms starting in 2000 precipitated a decline in manufacturing and a process of deindustrialization. Manufacturing peaked in 1992, accounting for about 30 percent of the gross domestic product. Now it is 11 percent and declining.
. . .
With the government now strictly controlling the transfer of dollars outside Zimbabwe, companies dependent on trade are finding it increasingly difficult to import critical goods.
“We have companies scaling down or discontinuing certain lines that are heavy on import requirements,” said Busisa Moyo, president of the Confederation of Zimbabwe Industries.
. . .
As the formal economy keeps shrinking, more and more people have been crowding the area where Mr. Chitiyo sells shirts on Robert Mugabe Road.
Across the street, a girl’s voice was crying, “Twenty-five cents for a cob!” It belonged to Tariro Dongo, 13, on her first evening working as a street vendor. It was past 9 p.m. Tariro said she was good in school and wanted to become a teacher.
She had bought 20 corn cobs for $2 near her home in Epworth, a poor township outside Harare. If she sold everything, her profit, after transportation, would amount to a couple of dollars. Sitting on a black bucket and fanning the coals in a small charcoal burner with a piece of cardboard, Tariro roasted the cobs.
She was happy with the money she had made on her first day, Tariro said.
“Twenty-five cents,” she cried. “One cob left!”

For the full story, see:
NORIMITSU ONISHI and JEFFREY MOYO. “Trade on the Streets, and Off the Books, Keeps Zimbabwe Afloat.” The New York Times, First Section (Sun., MARCH 5, 2017): 6.
(Note: ellipses added.)
(Note: the online version of the story has the date MARCH 4, 2017, and has the title “Trade on Streets, and Off Books, Keeps Zimbabwe Afloat.”)

Connecticut Upholds Car Dealerships’ “Lucrative Stranglehold” on New Car Market

(p. A23) Connecticut and Tesla should be a perfect fit. But lawmakers failed to act on a bill in this year’s regular legislative session (for the third straight year) that would have legalized direct sales by Tesla, whose business model is rooted in selling directly to consumers.
The culprit? Heavy lobbying by the state’s car dealerships.
Thanks to Connecticut’s decades-old franchise laws, new cars can be sold only through licensed franchises independent of carmakers. Even though only about 5,500 zero-emission cars have sold in Connecticut since 2011, Tesla’s effort to cut out the middlemen would undermine the lucrative stranglehold that car dealerships have on the new car market.
. . .
. . . , the National Automobile Dealers Association claimed franchise laws “keep prices competitive and low.” However, a 2009 paper by an economist at the Justice Department’s Antitrust Division instead concluded that “car customers would benefit from elimination of state bans on auto manufacturers’ making direct sales to consumers.” The paper pointed to a study by a Goldman Sachs analyst in 2000 that found that direct manufacturer sales could lower costs by 8.6 percent, with most of the savings resulting from more efficient matching between consumer demand and supply, and a subsequent reduction in inventory.
No wonder the Federal Trade Commission has criticized franchise laws as a “special protection” for these dealers — “a protection that is likely harming both competition and consumers.”

For the full commentary, see:
NICK SIBILLA. “‘Connecticut Should Be Tesla Turf.” The New York Times (Fri., JULY 7, 2017): A23.
(Note: ellipses added.)
(Note: the online version of the commentary has the title “Connecticut Should Be Tesla Country.”)

The Department of Justice research paper, mentioned above, is:

Bodisch, Gerald R. “Economic Effects of State Bans on Direct Manufacturer Sales to Car Buyers.” U.S. Department of Justice, Economic Analysis Group, Competition Advocacy Paper # EAG 09-1 CA. May 2009.

Boys Town Closes California Sites Due to Intrusive Regulations

(p. 1A) It’s been a century since a young Irish priest named Father Edward Flanagan welcomed homeless boys into a run-down Victorian mansion in downtown Omaha.
But as Boys Town celebrates its centennial, the organization is lessening its focus on the kind of residential care model that made it famous.
The latest wave came in June, as Boys Town announced the shuttering of sites in New York, Texas and California, including one residential care site in Orange County.
. . .
In 2000 under the Rev. Val Peter, then its executive director, the organization had 16 sites — though some were shelters without residential care.
The Rev. Steven Boes, current president and national executive director, insists the Flanagan mission of caring for American families and children remains, despite what he called some tough decisions to close sites.
. . .
(p. 2A) Boys Town decided to shutter its 80-acre residential site in Trabuco Canyon and two family homes in Tustin, California, after years of advocating for regulatory changes in that state. At the time of the June announcement, those homes housed 28 children.
The Trabuco Canyon site was one of 14 Boys Town residential care facilities opened in the 1980s and ’90s as Peter worked to spread the model to larger metro areas around the nation.
Since then, changing state regulations have made it more difficult to implement the Boys Town model in many of those areas, said Bob Pick, executive vice president of youth care.
“We opened those sites 20 or 30 years ago, and it was an exciting time,” Pick said. “But times change, contracts change and we have to serve kids with the highest quality. We just couldn’t do that in some locations.”
When the Trabuco Canyon facility opened, youths stayed for up to two years, Pick said, adding that Boys Town’s own research shows that the minimum stay should be about six months and a yearlong stay is ideal.
Because of contractual rules including mandated length of stays in California, “we couldn’t get kids to stay longer than two or three months,” Pick said. “That’s just not quality care.”
. . .
The changes at Boys Town haven’t come without criticism.
The Rev. Peter worries that the closing of Boys Town sites and focus on research runs afoul of Flanagan’s mission. “I gave my whole life to this — to Flanagan’s dream,” Peter, 83, said. “This is called God’s dream. Times change, but God’s dream doesn’t.”

For the full story, see:
Klecker, Mara. “Renowned care model no longer main focus; Overall trend is toward in-home family consulting, fewer residential sites.” Omaha World-Herald (Sun., Aug. 27, 2017): 1A-2A.
(Note: ellipses added..)

California Elite Regulates to Reduce Affordable Housing

(p. A11) In Silicon Valley the median home costs $1.2 million, about 2.5 times as much as in Seattle. Houses are less expensive inland–about $350,000 in Riverside and Sacramento–but living there often means a long commute. The weather also isn’t much better than in Phoenix or Dallas, so why not move to another state? A net 800,000 people did just that between 2005 and 2015, and many of them earned less than $30,000.
. . .
The state Legislative Analyst Office notes that in California’s coastal metros more than two-thirds of cities and counties have policies explicitly aimed at restricting housing growth, such as limits on density. When a developer wants to break ground, local governments impose multilayered reviews that can mean getting approval from the municipal building department, health department, fire department and planning commission as well as elected officials.
Neighbors can delay or block projects using the state’s 1970 Environmental Quality Act. It isn’t coincidental that California’s housing prices soared during the 1970s. Getting a building permit in San Francisco takes about three times as long as in the typical American metro.
There are more-direct costs, too: Local governments tack on hefty development fees, which run about three to four times as high in California as in the rest of the country. Politicians often attach conditions to projects requiring developers to pay workers “prevailing wages,” determined by local unions. This is one reason the cost of construction labor in California is about 20% higher than nationwide. Stringent building codes and energy-efficiency standards can add tens of thousands to the price of a house–even though low-flow appliances often cause people to use more water.
All told, it costs between $50,000 and $75,000 more to build a home in California than in the rest of the country. Building a low-income housing unit costs $332,000–about $80,000 more than the median home in Dallas or Phoenix.
. . .
Zoning is generally the biggest obstacle to development in coastal areas.
. . .
California’s housing policies are intrinsically regressive. Limiting the supply drives up home values in well-to-do coastal communities, while pricing everyone else out of the market.

For the full commentary, see:
Allysia Finley. “Why Housing Is Unaffordable in California; What could really help is deregulation, but residents aren’t likely to get it from Democratic lawmakers.” The Wall Street Journal (Sat., Sept. 30, 2017): A11.
(Note: ellipses added.)
(Note: the online version of the commentary has the date Sept. 29, 2017.)

Regulations Reduce Health Care Quality and Increase Health Care Cost

(p. A15) There are two million home health aides in the U.S. They spend more time with the elderly and disabled than anyone else, and their skills are essential to their clients’ quality of life. Yet these aides are poorly trained, and their national median wage is only a smidgen more than $10 an hour.
The reason? State regulations–in particular, Nurse Practice Acts–require registered nurses to perform even routine home-care tasks like administering eyedrops. That duty might not require a nursing degree, but defenders of the current system say aides lack the proper training. “What if they put in the cat’s eyedrops instead?” a health-care consultant asked me. In another conversation, the CEO of a managed-care insurance company wrote off home-care aides as “minimum wage people.”
But aides could do more. With less regulation and better training, they could become as integral to health-care teams as doctors and nurses. That could improve the quality of care while saving buckets of money for everyone involved.
. . .
. . . the potential cost savings are considerable. There are 2.3 million Medicaid patients receiving long-term care at home. Imagine if even half of them replaced one hourlong nurse’s visit a month with a stop by a trained aide. Assuming the nurse makes $35 an hour and the aide $15, that’s an immediate savings of roughly $275 million a year.

For the full commentary, see:
Paul Osterman. “Why Home Care Costs Too Much; Regulations often require that nurses do simple tasks like administer eyedrops.” The Wall Street Journal (Weds., Sept. 13, 2017): A15.
(Note: ellipses added.)
(Note: the online version of the commentary has the date Sept. 12, 2017.)

The commentary, quoted above, is related to the author’s book:
Osterman, Paul. Who Will Care for Us? Long-Term Care and the Long-Term Workforce. New York: Russell Sage Foundation, 2017.

“We Need an Economy That Is Much More Flexible, Much Faster Moving”

(p. A9) France has stagnated for years under chronically elevated unemployment and slow growth. The country’s strong worker protections and expensive benefits have been blamed by some for being at least partly at the root of the problem.
. . .
Mr. Macron’s chan ges make it easier to hire and fire workers and allow some workplace issues to be negotiated directly at the company level, rather than through industrywide agreements, in hopes of stimulating both growth and job creation. The government focused especially on smaller businesses with fewer than 50 employees — the majority of French businesses — which have complained bitterly about excessive red tape and regulations.
. . .
“We are entering into an economy built on innovation, skills, digitalization,” said Mr. Macron in an interview Thursday with the weekly newsmagazine Le Point.
“To succeed in this world we need an economy that is much more flexible, much faster moving.”
Employees will no longer have jobs that last for a lifetime, but periods of unemployment are more likely to be temporary and go in hand-in-hand with more frequent job changes and retraining, he said.
Among the changes in the decrees published Thursday is license for employers to directly negotiate with their workers over certain workplace issues rather than having to follow industrywide agreements. That will allow a car parts factory in one region to have a different agreement with its workers than a similar company elsewhere.
Small companies especially are being given more leeway to bargain directly with workers or their representatives, without the mediation of unions.

For the full story, see:
ALISSA J. RUBIN. “Economy Idle, France Relaxes Its Labor Law.” The New York Times (Fri., SEPT. 1, 2017): A1 & A9.
(Note: ellipses added.)
(Note: the online version of the story has the date AUG. 31, 2017, and has the title “France Unveils Contentious Labor Overhaul in Big Test for Macron.”)

“I Believe in Free Markets and Open Skies”

(p. B1) DELHI — When the fast-growing Malaysian carrier AirAsia wanted to expand, India looked like the ideal frontier.
. . .
Then, AirAsia discovered the difficulties of doing business in India.
While it benefited from a recent loosening of restrictions on foreign investment in airlines, AirAsia India has contended with a web of red tape and regulations for new entrants that have added significant cost and complexity to its operations.
. . .
(p. B7) . . . Mr. Chandilya acknowledges that he misjudged India’s regulatory environment, which is uniquely stringent for airlines.
Taxes on aviation turbines are higher than almost anywhere else in the world. Every airline, even those with just a few planes, is also required to fly regularly to remote regions, where flights often run half full. And new entrants like AirAsia India are prohibited from flying lucrative international routes until they are five years old and have at least 20 aircraft, the so-called 5/20 rule.
“I believe in free markets and open skies, but if you look at the policies we have in place, I don’t think we have that at all,” Mr. Chandilya said.
. . .
Each Indian state controls its own taxes on aviation turbine fuel, and in many places it is kept as high as 30 percent. More than half of AirAsia India’s operating costs are fuel-related.
High taxes also extend to maintenance and Indian airlines often choose to take their aircraft to nearby countries for that work. AirAsia India plans to send its planes to Malaysia or Singapore for servicing once they’ve been operational for two years.
“I talk to ministers and policy makers about how they can help the industry and promote growth, but it is very difficult to get them to understand that reducing these taxes will probably boost their states’ economies,” Mr. Chandilya said.

For the full story, see:
MAX BEARAK. “India’s Restricted Airspace.” The New York Times (Tues., JUNE 23, 2015): B1 & B7.
(Note: eilipses added.)
(Note: the online version of the story has the date JUNE 22, 2015, and has the title “AirAsia Faces Red Tape and Tough Competition in India.”)

Regulatory “Pain in Spain”

(p. A1) Gerard Vidal formed a data-encryption firm, Enigmedia, when he couldn’t find an employer looking for a Ph.D. in physics. But even a physicist was perplexed by the paperwork involved in starting a company in Spain, and the launch was delayed months by a process he calls “illogical, inefficient and totally frustrating.”
For many in the eurozone, where government budget cuts and corporate layoffs have left more than 18 million people out of work, the only way to find work is to create their own jobs. But these inexperienced entrepreneurs are flying into harsh headwinds.
Scarce capital, dense bureaucracy, a culture deeply averse to risk and a cratered consumer market all suppress startups in Europe.
. . .
(p. A12) In 2013, the OECD ranked Spain second worst in a survey on barriers to entrepreneurship in 29 nations. Spanish entrepreneurs have found that one of their big business challenges is simply getting incorporated. In the six months that Diana and Arantxa Fernández needed to obtain the multitude of permits required to open up a nursery school last year, the sisters burned through most of the capital they had husbanded from taking lump-sum unemployment. Now they are on the financial ropes.
. . .
When David Fito tried to open a gluten-free bakery after getting laid off by a bank a few years ago, he said 30 banks refused to lend him the €100,000 he needed. He got the credit only after his parents pledged their apartment as collateral and seven other wage earners agreed to co-sign. He said his business is now growing.
. . .
In Spain, young people with an entrepreneurial DNA long felt like fish out of water. María Alegre started selling homemade jewelry in Barcelona at age 13 and still remembers her profit–13,000 pesetas, worth about $90 at the time. But she said she never heard the word “entrepreneurship” until her fifth year at a Spanish business school and didn’t get encouragement until she was studying at the University of Michigan. Today, the 29-year old Ms. Alegre is CEO and co-founder of Chartboost Inc., a 130-employee San Francisco company that helps mobile-game developers find new users and monetize games. Ms. Alegre bemoans what she calls a Spanish “culture of being against risk and not dreaming big enough.”

For the full story, see:

Matt Moffett. “New Entrepreneurs Find Pain in Spain.” The Wall Street Journal (Fri., Nov. 28, 2014): A1 & A12.
(Note: ellipses added.)
(Note: the online version of the story has the date Nov. 27, 2014.”)