Lisencing eBay Sellers

I wrote before of the cost that licensing imposes on the economy.  I love Milton Friedman's take on licensing and certification:

The justification offered is always the same: to protect the consumer. However, the reason
is demonstrated by observing who lobbies at the state legislature for
the imposition or strengthening of licensure. The lobbyists are
invariably representatives of the occupation in question rather than of
the customers. True enough, plumbers presumably know better than anyone
else what their customers need to be protected against. However, it is
hard to regard altruistic concern for their customers as the primary
motive behind their determined efforts to get legal power to decide who
may be a plumber.

Now, from Ohio (and via Cafe Hayek) comes this attempt to regulate auctioneers:

Besides costing $200 and posting a $50,000 bond,
the license requires a one-year apprenticeship to a licensed auctioneer, acting
as a bid-caller in 12 auctions, attending an approved auction school, passing a
written and oral exam. Failure to get a license could result in the seller being
fined up to $1,000 and jailed for a maximum of 90 days.

Keep Friedman's quote in mind.  Note that under this system, auctioneers have an automatic veto over new competition, since all potential competitors must find an existing auctioneer to take them on as an apprentice.  Imagine the consumer electronics business - "I'm sorry, you can't make or sell any DVD players until Sony or Toshiba have agreed to take you on as an intern for a year".  Yeah, I bet we'd see a lot of new electronics firms in that system - not.

It gets better, though.  The law is written in a way that it applies to Ohio residents trying to sell on eBay:

Here's the response offered by state Senator Larry
Mumper, author of the legislation: "It certainly will not apply to the casual
seller on eBay, but might apply to anyone who sells a lot," he said. "If someone buys and sells on eBay on a
regular basis as a type of business, then there is a need for
regulation."

This is the kind of regulation mentality that is killing us.  eBay has a great rating system, and while the system sometimes trips for small sellers (since they can just start a new account) but big volume competitors ruthlessly protect their reputation on eBay because it is so visible.

 

  • http://www.theglitteringeye.com Dave Schuler

    I think there's a pretty good argument that the sellers on eBay are the consigners and that eBay is the auctioneer. Forcing eBay to comply with 50 differing sets of laws governing auctioneers would be interesting, though.

  • http://pundix.com Ron

    I don't think any legislation coming out of Ohio could surprise me. I moved here (the Cleveland area) about seven years ago and am still constantly amazed at how much things are over-regulated here. We have more taxes than anyone I know of and the regulations for doing anything are just insane. I had to have an inspection when I put in a new water heater. I'm guessing that next year I will have to apply for a permit to cut my grass...

    Ron

  • http://enviropundit.blogspot.com Jacqui

    From being in the building industry, I can definitely see the need for any kind of builders, designers or engineers to be licensed. If you do bad enough work, you lose your licence. It's not perfect, but it's something at least. If I'm not mistaken, I believe that licenses for building professionals started with government, not with the professionals themselves.

    Having said that, trying to regulate sellers on eBay is just ridiculous! It's a truly bad idea and a bad precedent. Hopefully, it won't get very far.

    Good blog too!