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SCOTUS smacks down cronyistic state regulatory boards
Posted: Tue Apr 21, 2015 5:05 pm
by Pointedstick
http://www.latimes.com/business/hiltzik ... tml#page=1
These are just two of countless ways that members of a business or occupation can close the doors to others by using their authority on a state regulatory board. This smacks of "restraint of trade," a fundamental no-no in antitrust law. Until a few weeks ago, such state regulatory boards thought they had an exemption from the law. The U.S. Supreme Court has now set them straight, ruling 6-3 on Feb. 25 that if a "controlling number" of a board's members are active participants in the business it regulates, they could be sued as antitrust violators.
Very impactful ruling! The libertarian in me is celebrating, because these boards are cronyistic, regulatorily-captured, competition-squashing disasters. But on the other hand, it's clear that this isn't the end of these boards. As a result, I sort of worry that something worse will be the result: having these powerful licensure and regulatory boards but requiring that they include a majority of non-experts and industry outsiders almost seems worse; there's a heightened potential for stupid and irrational decisions that help nobody, because the people making decisions simply don't understand the industry, or for the remaining experts to simply dominate the discourse and have everyone else rubber-stamp their decisions.
I have not read the actual opinion yet but look forward to doing so. The dissenters were Alito, Scalia, and Thomas.
Re: SCOTUS smacks down cronyistic state regulatory boards
Posted: Tue Apr 21, 2015 8:17 pm
by Libertarian666
Pointedstick wrote:
http://www.latimes.com/business/hiltzik ... tml#page=1
These are just two of countless ways that members of a business or occupation can close the doors to others by using their authority on a state regulatory board. This smacks of "restraint of trade," a fundamental no-no in antitrust law. Until a few weeks ago, such state regulatory boards thought they had an exemption from the law. The U.S. Supreme Court has now set them straight, ruling 6-3 on Feb. 25 that if a "controlling number" of a board's members are active participants in the business it regulates, they could be sued as antitrust violators.
Very impactful ruling! The libertarian in me is celebrating, because these boards are cronyistic, regulatorily-captured, competition-squashing disasters. But on the other hand, it's clear that this isn't the end of these boards. As a result, I sort of worry that something worse will be the result: having these powerful licensure and regulatory boards but requiring that they include a majority of non-experts and industry outsiders almost seems worse; there's a heightened potential for stupid and irrational decisions that help nobody, because the people making decisions simply don't understand the industry, or for the remaining experts to simply dominate the discourse and have everyone else rubber-stamp their decisions.
I have not read the actual opinion yet but look forward to doing so. The dissenters were Alito, Scalia, and Thomas.
I guess it's possible to have worse outcomes than the present system, but I'm more optimistic about it than you are. As far as I've been able to tell, "experts" from the industry being regulated are expert primarily in rent-seeking for their cronies.