Fighting for economic liberty in Montana

January 29, 2015 | By TIMOTHY SANDEFUR

Most people define the American dream in terms of economic opportunity. Yet sadly, in many states, licensing laws deprive would-be entrepreneurs of their right to earn a living, not to protect the public, but to stifle competition for the benefit of existing companies.

Take Tracie Pabst. Tracie has operated successful transportation companies in New Mexico and Texas, and now she’d like to open one in her home town of Big Sky, Montana. But before she can, she has to permission from her competitor’s first. Under Montana law, any new transportation business has to apply for a Certificate of Public Convenience and Necessity (CPCN). Once a person applies, “any interested party” can protest–which subjects the applicant to an expensive and burdensome hearing in which she must prove to government bureaucrats that there’s a “need” for the business. Like many such laws, Montana’s CPCN law doesn’t define what a “public convenience and necessity” is, and doesn’t explain how to prove it. But it does instruct the state’s Public Service Commission to deny a CPCN in most cases if the new business would compete against existing companies.

That’s unconstitutional. Last year, PLF won an important legal victory in Kentucky, striking down that state’s Competitor’s Veto law because it violated the Constitution’s protections for the right to earn a living. And in another PLF victory, the Ninth Circuit–which governs Montana–declared that states may not use licensing laws simply to protect established businesses against legitimate competition. Now we’ve taken up Tracie Pabst’s case, to vindicate her right to start a new business without this absurd and unjust interference.

Montana lawmakers are currently considering a bill to change Montana’s Competitor’s Veto law. As Tracie’s case makes clear, the present law is an unjust intrusion on the right of all Montanans to economic freedom. You can learn more about her case here.