December 16, 2010

PLF takes on the Missouri Mover Monopoly

By PLF takes on the Missouri Mover Monopoly

Author: Timothy Sandefur

Michael Munie is a St. Louis entrepreneur who runs ABC Quality Moving. Unfortunately, although he has a federal license allowing him to move people across state lines, and a state license that allows him to operate in a section of St. Louis, he’s not allowed to move people elsewhere in the state of Missouri. That’s due to a state law that requires him to first get permission from existing moving businesses.

When Munie applied for a license to operate throughout the state, four moving companies were given the chance to object, and when that happens, the state’s Department of Transportation must hold a hearing to determine whether Munie’s business is “consistent with the public convenience and necessity.” What does that mean? Nobody knows—the law provides no standards or rules or definitions. And not only does this law allow existing companies to veto their own competition—it only allows existing companies this privilege.  The general public isn’t even allowed to participate in the scheme.  And this law is supposed to protect the general public?  From what?  From low prices?

Of course, the law doesn’t protect the public—it protects established businesses against fair competition. It creates a cartel that doesn’t have to compete fairly by improving service and lowering prices. In fact, here is an example of an objection. When Mr. Munie applied for a license, United Van Lines and several other companies filed “interventions” like this one. As you can see in paragraph 5, the whole basis for the objection is that his business would “permit substantial diversion of traffic from [United’s] motor carrier operations”—meaning that customers would hire Mr. Munie instead of United Van Lines.  United didn’t even try to claim that a new company would be dangerous to the public or anything like that. They just took advantage of the law to bar their own competition. And you can’t blame them; that really is the law.

PLF filed a civil rights lawsuit in defense of Michael Munie’s right to earn an honest living—a right guaranteed by the Fourteenth Amendment to the Constitution.  The state has filed a motion asking the court to throw the case out, and on Tuesday morning, I’ll be arguing in opposition to that motion. 

You might remember that early last year, in response to a PLF lawsuit, the state of Oregon repealed an almost identical law.

Sadly, this is just one of the many ways government interferes with our economic liberty, not to protect the public, but to protect established industries. This is a consequence of the “public choice” phenomenon that exists whenever we allow government to redistribute wealth or opportunities. The only protection against this sort of private interest lawmaking is a Constitution with strong protections for economic liberty, private property, and all of our other inherent human rights.

Note: the hearing on the motion to dismiss is set for 10 a.m. Missouri time, at the federal courthouse on 111 South 10th Street, but I will be making the argument by telephone from California.

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