Occupational licensing is supposed to protect consumers against people who would practice a trade without the proper qualifications. In the first Supreme Court case on the question, Dent v. West Virginia (1883), the Court held that government may require people to be trained and educated before taking up the medical profession, because “such regulations” help “secure” the public “against the consequences of ignorance and incapacity as well as of deception and fraud.” But, the Court warned, if states impose licensing requirements that are not aimed at protecting “the general welfare of [the] people,” those restrictions “can operate to deprive one of his right to pursue a lawful vocation.”
But Dent was decided before the advent of “rational-basis scrutiny,” the rule under which courts today typically ignore violations of the right to earn a living. Under today’s law, state governments are given extremely broad power to limit economic freedom in whatever way lawmakers or unelected bureaucrats think best. That raises a crucial question—one on which the federal Courts of Appeals are now divided: may government restrict economic freedom, not to protect the public, but solely to protect the private benefits of a preferred group of people? Does such “mere protectionism” qualify as a “legitimate state interest” under the lenient “rational basis” rule?
Read more at http://www.cato.org/blog/government-people-or-cronies
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