State and local licensing requirement for jobs such as cosmetology. Labor secretary Alexander Acosta said lawmakers should work to get rid of unnecessary state licenses. This event just getting underway. Live coverage on cspan2. This project launched in 2016. To foster a conversation around regulatory excess and the harm it causes. They consist of 12 working groups, each composed of experts in specific fields of regulatory law and policy ranging from environmental and energy to race and trade in june of this year from each of the working groups started to release their papers, podcast and videos which among other things can be found on our website, which is a great project. Org. I invite you all to visit the website. Todays panel is the first of these conversations for the antitrust Consumer Protection working group and is devoted to occupational licensing and other restraints on competition. I am now going to turn it over to my comoderator and our hosts were today, lisa kimmel. Thank you very much, koren. My name is lisa kimmel and im senior account with your in the antitrust group. Like everyone else that you hear from on the panel today, before joining the law firm i spent some time at the federal trade commission where was the antitrust advisor to former chairwoman edith ramirez. I worked very focused on antitrust and competition matters in that particular sector in the intersection of intellectual property. We really want to welcome everybody to the firm and thank you for the opportunity to host this program. With that, ill introduce our very Strategic Group of panelists. First of all, we have a full house and. Policy planning which i believe is in charge of liberties now. Also an attorney advised former ftc commissioner Orson Swindle and she began her ftc career in the general counsels office. Let me also add before joining the ftc for that first stent, she has spent five years at the u. S. Courts of appeal for the d. C. Circuit serving as a law clerk and staff attorney. She graduated with distinction from the Antonin Scalia law school at George Mason University and with honors from university of virginia. Thank you for joining us and well, to the program. To my immediate right we have Professor James cooper, professor cooper is an associate professor of law at Antonin Scalia law school at George Mason University. James brings over a decade of public and private sector expensed as research and teaching work. James also spent time at the federal trade commission where he served as the deputy and acting director of the office of policy planning and is an attorney advisor to the federal trade commission or bill. I wanted note james also spent some time here with the antitrust group, a fairly fine firm Crowell Moring in his earlier career. We are happy to welcome james back. His research at the law school focuses on competition and Consumer Protection issues including privacy, data security, state restraints on competition, behavioral economics and antitrust treatment and prices commission. James has a ba from university of South Carolina and a phd in economics from emory university. James holds a law degree magna cum laude from the Antonin Scalia law school at George Mason University. And last but not least we have sarah allen, a Senior Assistant attorney general in unit manager the antitrust unit in the Virginia AttorneyGenerals Office. She currently cochairs the National Association of attorneys generals state action working group, so the right person to be on this panel. She successfully argued the Summary Judgment motion and Fourth Circuit appeal on behalf of of the virginia board of medicine in six of his individual Board Members against an antitrust claim that a chiropractor who was sanctioned by the board for practicing outside the statutory scope of practice. Most recently she represented the commonwealth of virginia in the federal and multistate challenges to the aetna humana and anthem Cigna Mergers and has worked with federal enforcer to challenge and settle other mergers. Before coming to the Virginia AttorneyGenerals Office sarah has spent time eight years at the federal trade commission. So thank you very much and with that i will turn it back over. Great. The format is will try to do interactive discussion led by the moderators and then will observe about ten to 50 minutes at the and for questions from the audience. By way of background occupational licensing and state restraints on trade, competition have received significant bipartisan attention in recent years. For example, in 2015 the Obama Administration released a report outlining the growth of such restraints, its cost and benefits, the impact on workers and work arrangements. Earlier this year acting chairman ohlhausen through the ftc launched the Economic Liberty Task force which im sure she will tell us some about. So chairman ohlhausen, if you could start us off to just give us a little overview of what the main concerns are in issues with respect to restraint. Thank you everyone and for you froze yesterday picked as one of my favorite topics come something into to my heart. I spent all of my career focusing on it. Its no accident that it something the ftc has focused quite a bit on. We are in agency that this Consumer Protection and antitrust. The occupational licensing kind of is at the intersection of those two issues. Where very often these restraints on entry to a profession are put forth and necessary for Consumer Protection reasons. I think were particularly well place as an agency to think about that and to say does that make sense to us. So the issue is occupational licensing i think has come to the forefront because occupational licensing has exploded. So when back to 1950s, Study Suggests about fewer than 5 of occupations required a license. Today that number is approaching 30 . So what changed in that time. And the number of occupations in the types of occupations that licensing has expanded to has gotten i think beyond what we can say of course you want your jobs to be license, you want someone whos doing a health and safety related thing to be licensed but we have cases where florists are license, where interior designers are licensed, or hair breakers are licensed. And so you start to say what is the rational for that, why is it happening . That is where the antitrust side of the analysis comes into play. One way i have characterized this is as the antitrust enforcers we need to be alert to private anticompetitive conduct but the actions of the government can also be anticompetitive. In a way that is a lot less likely to be eroded by market dynamics. I often called what i call the brother may i problem, and its where you need your competitors permission to enter the market. Thats one of the issues weve seen when we have boards of active Market Participants saying well, you need this license or the practice of our North Carolina dental case that we won in the Supreme Court they said the practice of dentistry now includes tooth whitening in the state of North Carolina. What are some of the problems . I think the problems are manifold. One of them certainly is anticompetitive problem where you say consumers may be paying more for a service or have fewer choices or there may be less innovation happening because of these owners licensing requirements. Theres also an impact on workers where workers have lost the ability to enter a field more freely. I see clark neeley back there. Clark has paid wonderful attention to this issue and destined fantastic work in this area. But i think thats what of the issues here is what about the individual worker and their ability, even if they have a skill that we all agree requires a license, if they are moving from state to state, they have to undergo that licensing all over again. Certainly that isnt necessarily an ftc antitrust issue. We have focused more on where you have an active Market Participants saying you cant compete with me, but, on our advocacy role at the ftc thats what weve tried to talk to states and really even other parts of the federal government about some of these issues. They are hitting certain populations quite a bit more onerous leave than others. One is believe it or not military spouses, members of the military move a lot, get deployed to different places around the country and the trailing spouse has a license, a job requires a license. They have to get relicensed, recertified, undergo time to train even if they been active in the field already. It has led to i think its one of the contributors to the fact that youve got an appointment rate of almost 20 in that population. So thats why ive launched my Economic Liberty Task force at the ftc. I see it as an attempt to shine a real spotlight on this issue. Certainly we can continue to bring Enforcement Actions where appropriate but it is mine and advocacy role. I talked often about being a coalition of the willing because i think a lot of groups, consumer organizations, you mentioned bipartisan appeal of this has extended to a lot of the interest in this topic to a lot of different areas and i worked with states, Governor Scott walker and i get a joint oped on this issue. I think were in a particularly good time to make progress on this issue, but the problem is the lack of competition, the higher prices, lower innovation but also the effects on the workers. Thank you, acting chairman. Sarah, we are really interested your from the states perspective on the occupational licensing issues the acting chairman take you to the Federalist Society and koren wongervin and george mason for inviting me to be on the panel today to be the spoiler on the panel. Id like to start with a disclaimer that the opinions express today are only mine. They dont reflect necessarily the opinions of virginia ags office or any other participant in the National Association of attorneys in general. And it is a little odd for me because at 95 of the time i am the antitrust counterparts are or enforcers like the federal agencies that we work with quite often, the ftc and dha. But in this one little area with flip and would become Defense Attorneys for state boards and state agency that arches up at a competitive behavior the antitrust experts. So being the state apologist on this panel is a little backwards to me, but so is the position of otherwise staunch state rights advocates like senator mike lee and senator ted cruz, but we will talk about it occupational licensing bill in a minute. So my personal perspective from the stateside is that i see a lot of value to this wider philosophical discussion about whether to many occupations required licenses. I also basically agree with the Supreme Courts decision in in c versus dental pick but at the end of the day it should be left up to the states to decide how to structure their economies, how to structure their government and how to provide for the health and safety and welfare of their citizens. I applaud the ftcs efforts to educate state legislatures and others about the dangers to the National Economy of too much licensing. I support their enforcement efforts. However, i do not support the federal government attempts to preempt states abilities to decide these issues for themselves or to dangle state action immunity as a carrot in order to coerce states into provide active supervision and the merit it sees fit or to adopting its glossy about the appropriate professions to license. Under current case law principles of federalism allow states to decide which occupations they will license as opposed to professions that only require certification, registration or have no restrictions at all. Once a state legislature has authorized a licensing scheme with a board of active Market Participants as Board Members, the only question that remains in order for the board and its members receive state action immunity are whether they meet the two prongs, which is one of them was the board following a clearly articulated and affirmatively expressed state policy to displace competition, and whether the board was actively supervised by a disinterested state official to ensure the boards actions were consistent with that policy. There is some ambiguity in the nc dental opinion about whether the active supervisor only had to determine that the boards actions were consistent with state policy or whether there to go beyond that to look to see whether it was unduly burdensome. But there is no requirement that the active supervisor inquiry into whether the board used the least restrictive alternatives to achieve the legislatures goal. There is no ability for the active supervisor or the state courts to disregard the state legislatures intent to displace competition in favor of a licensing scheme. Moreover, states could easily decide to give it all of their state boards and switch to the oversight of license occupations from the boards to traditional state agencies with fulltime salaried state employees. That gets rid of the need for active supervision but has many disadvantages, the most obvious being it would add millions to the budget to employ all those people because state Board Members currently serve with no pay in most cases. It would also not necessarily change the state legislatures philosophy about which occupations to license. While making it harder to actually maintain an antitrust challenge against the state. While it would take care of the problem of Board Members acting in their individual selfinterest, it would not address a different problem which is regulatory capture of the state employees who start sympathizing with the people and industries that they regulate. Rather than the state one of my favorite phrases is casting a dicey cloak, a state authority on what is essentially private economic context i think thats kind of the other factor, is it truly the states of action rather than devolving that to a private actors who will often act in the own private interest. I know you wanted to wait in. Quickly respond that Board Members, if you talk to them they are really trying to do their best and the most instances. Maybe theyre acting in their self interest. Sometimes its pretty blatant like the North Carolina dentist case. I think a lot of these cases are really on the margins where they really think theyre doing the right thing. It seems a little paternal for the federal government to say should you be making these decisions . We dont think you should and we will make it so you dont get state action immaturity and lets you do it the way we think you should do it. That was my point on that. I think sarah and chairman ohlhausen covered both of the ground, but building want to add is i didnt want to make sure we are talked about occupational licensing regimes that i think sarah alluded to this that we talking more broadly not just limiting, in fact, setting up credentials and seeing if you dont get score x on your marks and you can be an attorney, or thats the quintessential case you cant be a hair braiders is done x number of hours. Thats one level that a lot of the work i did when i started at the ftc in the office of policy planning was looking at the toast of state restrictions on competition that maybe you can put them in the occupational licensing category but attorney, limits on attorney advertising. We that several Supreme Court cases on first and then issue surrounding but there still to this day state bars that try to limit the ability of attorneys to advertise. Does that fit into occupational licensing . You can maybe put in that but its a different animal, minimum service requirements. There was an issue with that when the internet was burgeoning and online real estate providers, and the traditional real estate providers didnt like that. What did they do . A try to increase state set up minimum requirements that sit if youre going to be Real Estate Agent, youve got to do house showings injected all these sort of things, why . To prevent this intermediation. Again, in several occupational licensing . And wasnt about when you can be a Real Estate Agent or not. It was regulations that are promulgated by these boards. North carolina dental wasnt so much of it who could be a dentist and who couldnt be. It was in some ways about scope of practice but had a lot to, so the only thing i want to emphasize, i think we touched on it, in my view most of the mischief of these boards do, i think all the points that chairman ohlhausen brought out as far as limiting economic mobility or Labor Mobility really, really important has to do with the regime itself to say youve got to have this qualification to be in this profession. Those are bad and have their own anticompetitive effects but i think to meet the core mischief here is the regulations these self and rest divorce often promulgate. Not so much the restrictions in the profession