Can you define “art therapy?” More specifically, can you define it well enough to criminalize the unauthorized practice of it?

The state Senate thinks it can.

This coming Wednesday, the House Executive Departments and Administration Committee continues its hearing on Senate Bill 535, to establish state licensure of art therapists. (The bill passed the Senate on March 15.)

If SB 535 becomes law, it will be a misdemeanor for any individual to practice art therapy for pay without a state license. For corporations, it would be a felony.

What is art therapy? According to Art Therapy Journal, the practice originated in the 1940s when artist Adrian Hill, being treated for tuberculosis, thought to teach art to his fellow sanitarium patients as a means of therapy. Early practitioners were not therapists, but artists who realized that the artistic process had various therapeutic uses. Only much later did art become adopted as a treatment method by therapists, as the journal recounted.

SB 535 assumes, contrary to the history of art as therapy, that highly specialized training is an essential foundation for blending art and therapy. To get a license under the bill, one would have to obtain a master’s or doctorate in art therapy and accumulate “not less than 2 years, with a minimum of 2,000 hours, of supervised experience in art therapy.”

One need not try to practice unlicensed psychology to fall afoul of the law under this bill, but merely use integrate basic psychotherapeutic principles into the creative process for the purpose of helping people feel better or cope with stress or trauma.

Not all of these techniques are a part of a new, highly specialized scientific field. “Throughout recorded history, people have used pictures, stories, dances, and chants as healing rituals,” a major 2010 review in the American Journal of Public Health concluded.

No doubt there are highly trained specialists who can do wonders with art therapy and who deserve handsome compensation for their services. The problem with this bill, as with so many licensing bills, is its assumption that anything short of the work of the most highly trained expert is so dangerous that it must be banned.

Importantly, SB 535 does not ban the unlicensed practice of psychology. That is already illegal. The bill makes it illegal to apply the principles of psychotherapy to art instruction.

In the beginning of this legislative session there was hope that lawmakers would reduce licensing burdens. Part of that hope came from the huge shortage of licensed substance abuse counselors relative to demand.

New Hampshire’s opioid addicts are going without treatment in part because state licensing requirements have kept the supply of counselors artificially low. Senate Bill 487, which mandates that the state waive licensing requirements for substance abuse counselors who have licenses from other states, was, surprisingly, not killed by the Senate. It is slowly making its way through the House.

But despite shortages in other fields, the Senate has killed bills that address similar problems. This week the Senate killed House Bill 1217, which would have reversed the mandate, passed in 2016, that all school nurses have a bachelor’s degree. Nurses in any other setting need only an associate’s degree. School officials testified that they face serious nursing shortages and that the bachelor’s requirement has made the problem worse. They were no match for the lobbying power of Big Nurse.

And as this Unnamed Newsletter has noted before, the Senate killed House Bill 1685, which would have reformed the occupational licensing process to make it less burdensome.

Maybe, like a Rolling Stones fan who unwittingly hopped into an Uber driven by a Beatles obsessive, you’re tired of hearing this tune. Fine. We’ll cue up something cooler. In just a second. First, we’ll remind you that, unlike John Lennon’s songwriting ability, occupational licensing remains a huge issue, as the number of bills dealing with it suggests. And highlighting its problems is the only way for people to understand how damaging licensing can be. Roughly a third of the U.S. workforce faces occupational licensing requirements. That figure was only about 5 percent in the 1950s. By contrast, about 11 percent of the workforce is unionized.

Licensing can be a significant barrier to upward mobility and economic opportunity. In New Hampshire, legislators continue to block reform and pass new requirements, making these problems worse. Relief typically comes only when a crisis develops, as in the case of licensed substance abuse counselors.

There are real consequences to inaction. Schools are short of nurses. Opioid addicts get worse while waiting for counselors. But requirements keep being piled on, as if everything is fine.

Things aren’t fine, and they’re getting worse. Without some action by legislators to control the growth of these requirements, they will continue to spread like a plague of job-eating, wage-eroding, state licensed locusts.

On Tuesday, the august members of the New Hampshire House of Representatives will consider House Bill 287, which would create a commission to study legalizing prostitution. It comes with an “ought to pass” recommendation from the House Criminal Justice and Public Safety Committee. (The jokes really are so obvious, you’ve probably already thought of a better one than this newsletter would.)

HB 287 is part of a growing trend toward legalizing behavior once considered taboo or at least distasteful. From same-sex marriage to marijuana use to prostitution, government-imposed restrictions on private behavior are being abolished. There is even a new movement to make marijuana use a 10th Amendment issue and get the federal government out of it altogether.

(Honestly, 10th Amendment advocates are making a big strategic mistake here. Marijuana should be at the end of the list. It does the 10th Amendment movement no good for everyone to be too complacent after the first victory to put down the Doritos, get off the couch and continue fighting.)

While Granite Staters this year hear a lot about the pros and cons of legalizing “sex work” (that’s what it’s called in the bill), lots of other non-controversial occupations will remain illegal to practice for pay without state approval. For instance, auctioneering.

RSA 311-B makes it “unlawful” for any person to “knowingly engage in, or offer to engage in, auctioneering for a fee, commission, or other consideration unless such natural person has a valid license under this chapter or such other person is an authorized business organization.”

Unless you have a license, you break the law just by claiming you are “able to perform auctioneering.”

In New Hampshire, this is a criminal offense. Auctioneering for pay, or merely claiming the ability to perform auctioneering, is a misdemeanor for an individual and a felony for a business.

The “Occupations and Professions” section of state statutes is peppered with criminal penalties for working without state permission.

RSA 314 makes it a misdemeanor to practice eletctrolysis without a license.

RSA 323 makes it a misdemeanor to sell lightning rods without a license. (We are not making this up.)

RSA 328-H makes it a violation on first offense, a misdemeanor on second, to practice “Asian bodywork therapy” without a license.

RSA 331-A makes it a misdemeanor to engage in real estate brokerage without a license.

RSA 332 makes it a misdemeanor to “practice veterinary medicine” without a license. The statute defines “practice of veterinary medicine” as: “To diagnose, treat, correct, change, relieve, or prevent animal disease, lameness, deformity, defect, injury, or other physical or mental conditions….”

It is not always a criminal offense to work in certain fields without permission. Sometimes the state just makes it really hard to enter the field.

To become a cosmetologist, one must complete 1,500 hours of schooling or 3,000 hours of training under a licensed cosmetologist.

To become a pastoral psycotherapist, one must have a master’s in divinity, a Ph.D. in pastoral therapy, and 3,000 hours of supervised experience.

To become a “shampoo assistant apprentice,” one must first “work under the direct supervision of a licensed barber or cosmetologist for at least 150 hours” and pay a $25 fee. This is for a job that consists exclusively of “shampooing, rinsing and removing rollers or permanent rods, rinsing treated or untreated hair, and other cleansing or sink-related functions not requiring the skill of a cosmetologist or barber.”

If not the state, who will save us from unregistered shampoo apprentices?

Thankfully, some people have noticed that the state’s occupational licensing regime has become exceedingly burdensome. Rep. Bill Ohm, R-Nashua, has introduced a bill to create an occupational regulation review commission that would examine whether licensing boards use the least restrictive means to achieve their goals. It’s not as sexy a media topic as prostitution, but (presumably) it would have a bigger impact on the average Granite Stater.

September 2015

Daniel Hyland

In the effort to rejuvenate New Hampshire’s economy, occupational licensing is an important puzzle piece that is often overlooked. With the ostensible aim of protecting consumers, occupational licensing regulations set up barriers to entry, potentially preventing countless workers who would readily contribute to economic growth, but find themselves blocked by restrictive policies. The result for the consumer is higher prices and fewer choices.

Occupational Licensing: How New Hampshire Compares

Occupational licensing refers to any situation where someone wishing to enter a line of work must first apply to the government for permission to do so.[1] Obtaining a government license requires that job-seekers meet state-determined standards regarding age and education, as well as pay fees and pass related exams. A recent White House report notes that “about 25 percent of today’s U.S. workforce is in an occupation licensed at the State level, up from less than 5 percent in the early 1950s.”[2]

In their publication License to Work: A National Study of Burdens from Occupational Licensing, the Institute for Justice examines state-level licensing regulations on 102 low-to-moderate-income occupations, ranging from auctioneers and bartenders to tree trimmers and upholsterers. New Hampshire licenses only 34 of these 102 occupations. However, these occupations are often highly regulated, and New Hampshire’s licensing laws are the 28th most burdensome, as measured by the average requirements imposed on license applicants. That means New Hampshire is substantially worse off than Rhode Island, at 37th; and barely better than neighboring Massachusetts, at 25th.

Combining the number of occupations licensed by a state with the state’s average licensure burden yields the ranking criteria of “most broadly and onerously licensed state.” This makes the Live Free or Die state the 43rd most broadly and onerously licensed, slightly worse than Vermont at 44th.[3]

Some aspects of New Hampshire’s score in this study are particularly surprising. For instance, to obtain a city bus driver’s license requires 0 days of supervised education, but to become a cosmetologist requires 350 days of education and/or experience. To become a pharmacy technician, responsible for preparing and labeling medications and recording dosage information, the state requires a $25 fee, and nothing else; but to become a sign language interpreter costs $860, in addition to experience requirements and exams. New Hampshire requires 161 more days and $54 more to become licensed as a barber than as an emergency medical technician; and it is one of only 5 states to license shampooers–an occupation that both Hawaii, the most burdensomely regulated state in this study, and Arizona, the most broadly and onerously licensed state, do not regulate.[4]

Discrepancies like these point to deeper, underlying flaws. At 28th in terms of overall regulatory burden, New Hampshire needs to ask some questions about its licensing laws on the whole.

A view from 40,000 Feet:

In their report, the White House concludes that “current systems of licensure…place burdens on workers, employers, and consumers, and too often are inconsistent, inefficient, and arbitrary.”[5] Furthermore, such barriers significantly hamper the economic potential of “those who most likely aspire to [low-to-moderate income] occupations—minorities, those of lesser means and those with less education.”[6]

This is especially important in light of concerns regarding economic growth, since about half of the 102 occupations examined in the Institute for Justice’s study offer potential for new business creation (barbers, travel guides, and massage therapists, for example); and “about one-third of the 102 occupations are construction trades, such as masons, glaziers, painters and cement finishers, and in these trades, only those who act as contractors and have their own business need a license.”[7] This means that not only are job-seekers potentially barred from existing jobs due to these regulations, but new job creation is hindered as well.

To determine the areas most in need of reform, License to Work recommends asking whether an occupation is licensed in other states, whether a given state’s burdens are comparatively high, and whether licensure burdens in a given occupation are relatively high compared to occupations with greater safety concerns.[8]

Questions like these help to identify the shortcomings of regulations, and to determine whether licensing laws address a genuine harm or are only in place to artificially restrict the available supply of labor, thus allowing licensed workers to charge higher wages for their services. Since many licensed occupations offer potential for job creation, there is the risk that licensing regulations could be influenced by existing businesses, who would naturally want to limit any competition. This is known as “regulatory capture,” where the control of a regulatory body is used for private gain at the public’s expense.

There is ample reason to suspect such ulterior motives in any instance of licensing. A recent study found that “where government licensing is required for the job it raises hourly wages by about 8.4 percent.” The study also noted that it was unclear whether such gains are the result of conscious endeavors to artificially raise wages, or of workers having “acquired reputations that are valued in the market place.”[9] But there is evidence to suggest a conscious effort on the part of vested interests to restrict competition. As pointed out by the Council on Licensure, Enforcement and Regulation (CLEAR), “professions rather than consumer groups usually seek regulation,”[10] and licensure laws often “require entrants into a trade to pass exams…designed and graded by representatives of incumbent suppliers.”[11]

These circumstances suggest that businesses and workers are using the regulatory system for private gain, contrary to its intended purpose of protecting the well-being of the general public.

What Are the Alternatives?

In many states, licensing regulation is accompanied by what are known as “sunrise” and “sunset” laws. Sunrise refers to “a process under which an occupation or profession wishing to receive state certification or licensure must propose the components of the legislation, along with cost and benefit estimates of the proposed regulation…[and] convince the legislators that consumers will be unduly harmed if the proposed legislation is not adopted,” and “Sunset is the automatic termination of regulatory boards and agencies unless legislative action is taken to reinstate them.”[12] These common-sense measures provide basic and necessary accountability for regulators, requiring them to provide justification for new laws to be created, and for existing laws to persist.

New Hampshire however, has no sunrise law, and its sunset law was repealed.[13] In order to reform its regulatory legislation, state policymakers may resort to the introduction of new legislation–and in fact, there are two examples of this from recent years. House Bill 446, introduced in 2011, would have repealed the legislative authority to regulate a number of professions. But despite a favorable committee recommendation, the bill ultimately failed to pass.[14] The bill’s main sponsors followed in 2012 with HB 1265, a more general bill which would have set criteria for occupational regulation, established a committee “to determine the appropriate level of regulation for each occupation and profession,” and provided for the practice of professions “without being subject to laws that regulate the occupation or profession which are arbitrary, unnecessary, or substantially burdensome.” This bill was referred to an interim study, after which it was eventually voted down.[15]

Such difficulties demonstrate a concern that sunrise and sunset laws aim to address: namely, that regulatory legislation may tend to be easy to pass, but hard to undo. [16]  According to the Bureau of Labor Statistics, licensing regulation may be prone to this kind of outcome because of so-called “ratchet” effects: new licensing regulations often include “grandfather” clauses, which allow existing practitioners to continue their work without being subject to the new requirements. Because of this, a newly licensed market looks essentially the same as it did prior to regulation, and prices will tend to remain what they were. Consequently, the increase in wages discussed earlier may not occur immediately. However, as time goes on the grandfathered workers begin to exit the field, leaving mostly licensed workers who are protected from competition by the licensure laws; in this new situation, “de-licensing” may cause wages “to fall immediately with the inflow of new workers.” [17]

Perhaps this explains why there have been only eight instances of successful de-licensing in the last 40 years–and why, in half of those cases, attempts to reinstitute licensing regulations followed swiftly afterward. New Hampshire’s 2011-2012 reform efforts constitute one of only nine attempts nationwide in recent years to collectively de-license groups of occupations–all of them unsuccessful.[18]

Due to such concerns, it is important not only to address existing licensing regulations, but to be vigilant in scrutinizing proposed new licensure laws, and to explore alternatives to licensing.

One of the main alternatives to licensing is voluntary certification, which could be (and often is) offered privately, rather than through the government. Certification not only provides a lower-cost and less burdensome alternative, but significantly it can provide a clearer view of the genuine worth of standards in the eyes of practitioners and the public. By exposing certification requirements to ordinary market forces, a more appropriate balance can be reached between the standards set for practitioners, and the market demands on workers in a given profession.[19]

Conclusion

The White House report on occupational licensing concludes that there “is ample evidence that States and other jurisdictions should review current licensing practices with an aim toward rationalizing these regulations and lowering barriers to employment.”[20] To do this, New Hampshire should examine what measures are already in place to oversee licensing regulations, and cast a critical eye upon the motives that may underlie licensing requirements to ensure that any regulation protects both individual freedom and economic growth. Lowering barriers to entry means greater marketplace competition, with all the benefits that follow: lower prices, higher quality, and more consumer choice–and ultimately, more freedom and more growth in New Hampshire.

Click here to download a pdf version of this report

 

 

Appendix I:

Selected Occupations that Require a License to Practice in New Hampshire and their Requirements to Obtain

Burden Rank Occupation Number of States that License Fees Education/Experience (in days) Exams Estimated Employment             (as of May 2013)
1 Preschool Teacher 49 $130 1,825 2 2670
2 Athletic Trainer 46 $450 1,460 1 130
3 Earth Driller 47 $260 1,095 1 100
4 Midwife 29 $920 730 3 40
5 School Bus Driver 51 $80 732 6 310
6 Mobile Home Installer 39 $75 731 0 70
7 Cosmetologist 51 $124 350 2 320
8 Barber 50 $124 187 2 #
9 Massage Therapist 39 $125 175 2 50
10 Makeup Artist 36 $154 140 3
10 Skin Care Specialist 50 $154 140 3 40
12 Manicurist 50 $119 70 2 310
13 Sign Language Interpreter 16 $860 2 3 210
14 Cathodic Protection Tester 16 $1,500 8 2 120
15 Animal Trainer 20 $0 90 0 50
16 Bus Driver (City/Transit) 51 $70 0 5 330
17 Truck Driver 51 $60 0 4 6410
18 Emergency Medical Technician 51 $70 26 2 110
19 Pest Control Applicator 51 $20 0 3 190
19 Vegetation Pesticide Handler 51 $20 0 3
21 Shampooer 5 $25 35 0 #
22 Weigher 24 $106 0 1
23 Travel Guide 21 $60 0 1 370
24 Pharmacy Technician 12 $25 0 0
25 Child Care Worker 33 $27 0 0 2690
26 Auctioneer 33 $115 19 1
27 Slot Key Person 21 $510 0 0
27 Gaming Supervisor 23 $510 0 0
29 Animal Breeder 26 $200 0 0
30 Coach (School Sports) 24 $45 1 0 1220
31 Taxidermist 26 $50 0 0
31 Fisher 41 $50 0 0
33 Gaming Dealer 24 $40 0 0
34 Security Guard 37 $20 0 0 2250
  # included with Cosmetologist

 


 

[1] Donald J. Boudreaux, “Occupational Licensing: Reality Differs from Rhetoric,” Pittsburgh Tribune-Review, March 25, 2014, accessed July 31, 2015, http://mercatus.org/expert_commentary/occupational-licensing-reality-differs-rhetoric

[2] “Occupational Licensing: A Framework for Policymakers,” White House, accessed July 31, 2015, https://www.whitehouse.gov/sites/default/files/docs/licensing_report_final_nonembargo.pdf

[3] “License to Work: A National Study of Burdens from Occupational Licensing,” Institute for Justice, http://www.ij.org/LicenseToWork

[4]ibid., “State Profiles: New Hampshire,” http://licensetowork.ij.org/nh

[5] “A Framework for Policymakers.”

[6] Institute for Justice, conclusion, http://www.ij.org/l2w-conclusion

[7] ibid., “The Occupations,” http://www.ij.org/l2w-occupations

[8] ibid., Conclusion.

[9] Morris M. Kleiner, “Analyzing the Labor Market Outcomes of Occupational Licensing,” Cato Institute: Research Briefs in Economic Policy 26 (2015)  http://object.cato.org/sites/cato.org/files/pubs/pdf/research-brief-26-updated.pdf

[10] “Sunset, Sunrise, and State Agency Audits,” Council on Licensure, Enforcement & Regulation, accessed July 31, 2015, http://www.clearhq.org/resources/sunset.htm

[11] Boudreaux, “Reality Differs from Rhetoric.”

[12] “Sunrise, Sunset & State Agency Audits.”

[13] ibid.

[14] HB446 of 2011 Session of the New Hampshire General Court

[15] HB1265 of 2012 Session of the New Hampshire General Court

[16] “A Framework for Policymakers.”

[17] Robert J. Thornton and Edward J. Timmons, “The de-licensing of occupations in the United States,” Bureau of Labor Statistics: Monthly Labor Review (May, 2015) http://www.bls.gov/opub/mlr/2015/article/pdf/the-de-licensing-of-occupations-in-the-united-states.pdf

[18] Ibid.

[19] Edward J. Timmons, “‘Occupational Licensing Gone Wild?’: Why Licensing Is Not Always the Answer” (testimony presented before the Indiana Senate Commerce and Technology Committee, April 16, 2015.) http://mercatus.org/publication/occupational-licensing-gone-wild-why-licensing-not-always-answer

[20] “A Framework for Policymakers.”

Marc Levin

April 2014

Click here to download a pdf version of this report

Most of us would not want to be judged for the rest of our lives based on what we did when we were 17 years-old. Unfortunately, this is the reality for too many youngsters in New Hampshire since the state lowered the maximum age of juvenile court jurisdiction from 18 to 17 in 1996.  Now, With House Bill 1624 that overwhelmingly passed the House and will be heard on April 10 in the Senate, New Hampshire has an opportunity to join 40 other states in ensuring that most 17 year-olds are held accountable and rehabilitated in the juvenile justice system.

Fortunately, New Hampshire citizens can be assured that this proposal won’t let lawbreakers off the hook. The juvenile system maintains confinement options and, with smaller probation caseloads, actually provides closer supervision on probation than the adult system.

Perhaps most importantly, the juvenile system is oriented towards working with the most important institution in society- the family. New Hampshire 17 year-olds are covered by the state’s compulsory education law and in most cases are attending high school while living with their parents. Yet, because they are considered adults in the justice system, if they are arrested, a parent has no right to be informed and would not have a right to participate in any court proceedings or probation meetings. However, research has shown the most effective probation programs for this age group are those that work to strengthen the family’s capacity to provide discipline and structure.

This is one reason why studies have demonstrated that youths sent to adult court have a 33.7 percent higher recidivism rate than similar youths processed through the juvenile system. Not only does the juvenile system focus on the family, it offers age-appropriate programming and partners with the education system. For example, a juvenile probation officer typically maintains contacts with the local schools so they can respond quickly if a teen on their caseload is truant.

While most offenses committed by 17 year-olds are low-level, nonviolent crimes that do not result in incarceration, those youngsters that are placed in adult lockups with hardened criminals have a much higher rate of being physically and sexually abused. For this reason, the federal government recently strengthened the standards under the Prison Rape Elimination Act (PREA). This means that state and local lockups must not only separate 17 year-olds, because they are juveniles under federal law, but also provide them with programming. The official legislative analysis for HB 1624 estimates that this legislation will avoid up to $10 million in statewide capital expenses for retrofitting county jails and $250,000 in jail operations costs per county.

Furthermore, while an adult conviction can be a lifetime scarlet letter, those with a juvenile adjudication can often have their record sealed once they become an adult if they refrain from further offending and comply with all their obligations. This makes it far easier for those who have made a youthful mistake to years later obtain employment, student loans, and housing, all of which contribute to being a law-abiding, productive citizen.

Finally, it is important to note that youths charged with a felony in New Hampshire can be transferred to adult court following a certification hearing. At this hearing, the judge considers factors such as the maturity of the offender, whether the offense involved violence, and the likelihood of rehabilitation. There is a presumption in favor of transfer for youths charged with the most serious offenses such as first or second degree murder, attempted murder, manslaughter, first degree assault, aggravated felonious sexual assault, and kidnapping. Any juvenile who has been tried and convicted as an adult will thereafter be tried as an adult for any subsequent criminal offense.

HB1624 not only raises the age, but also makes other improvements in New Hampshire’s justice system. It clarifies the laws surrounding competency to stand trial and the right to counsel, promotes the adoption of evidence-based practices (those proven to reduce recidivism), requires the Department of Corrections to adopt plans to stop prison rape, and enhances data collection on key performance measures.

New Hampshire policymakers have a great opportunity to put more troubled teens on the right track by raising the age. This will result in 17 year-olds being held accountable and treated in the way most New Hampshire parents would want if it was their son or daughter.

 

Marc A. Levin is the director of the Center for Effective Justice at the Texas Public Policy Foundation.

Charlie Arlinghaus

January 22, 2014

As originally published in the New Hampshire Union Leader

The most sensational stories make the news but the most important work of the legislature is too boring for anyone much to care. The sensational stories will have little or no impact on New Hampshire. The boring stories have a long lasting but not sensational impact for years to come. That fundamental conflict is the long term struggle good public policy faces and it will be on display this year.

Some issues are more fun than others. The state’s House of Representatives passed a law legalizing marijuana last week. Certainly the debate raises interesting issues about changing societal attitudes, whether a prohibition structure is effective, the government’s legitimate role in drawing a line between legal and illegal substances. But the media response to the issue is all out of proportion to the issue’s relevance to current affairs.

This issue, which has no actual chance of becoming law this year, ought to be covered. But the disproportionate coverage of it is related to the titillation. Time magazine’s headline came with an attached giggle: “New Hampshire House Votes For Legal Weed.” Every editor’s secret adolescent fantasy about working the word pot or weed into a headline has become reality. It’s worth noting that the debate over last year’s passage of a medical marijuana law was accompanied by no such titillation.

A marijuana law is fun for headlines and television. If only the legislature would debate legalizing and taxing prostitution some poor newsman’s head might explode with glee.

Much of the work of state government and the legislature is dramatically less dramatic. Ultimately, the hard work of the legislature is a trustee managing what government has decided it is to do and exercising fiduciary oversight. Think of them as trustees acting on our behalf.

Unfortunately, that role is incredibly boring. Are you excited about debates over the rainy day fund and expected revenue growth? Of course not. You’re a normal person and it bores you to tears (we’ll leave aside, for the time being, the question of how normal you can be if you’ve actually read this far in a column of mine).

But the boring work is important. Congress ignores its fiduciary role regularly and as a result we have a debate about whether a balanced federal budget is even theoretically possible or relevant.

The state will ignore the details for a few years until we have serious structural problems and have to make some sort of sudden correction. You’ll remember the supposedly draconian budget passed in 2011? It was a very difficult 6.2% cut at the end of day (on an apples to apples basis).

The amount of correction needed became worse and worse as each year went by and they didn’t do anything. But failing to act isn’t news. It becomes news when the problem has grown so large that the required action is painful.

A small example of this is the current debate over state transportation spending. Year after year highway spending got worse. It’s not that we didn’t spend money but that we spent it on the wrong things. There is an obvious reason for that. We name big, exciting projects for politicians. We don’t name routine but cost-saving maintenance after anyone.

No politician ever ran for office bragging about how he increased the paving schedule which will lead to a gradual reduction is the number of miles under higher cost disrepair as opposed to more inexpensive fixes. I’m getting bored just writing the words.

In the end we like brand new, fun, high tech (and completely unnecessary) overhead high speed tolling. It’s really cool and people notice it. On the other hand, paving 42 miles of state route 865 before its gets into a state where it has to be completely redone at 20 times the cost is hardly conversational.

There must be a way to reward politicians for doing the hard work that’s boring. I think the only real way is to force them to talk more often about details. We may not always understand the details but they should be able to discuss them in a way that gives us at least some confidence they’re paying attention.

In addition, next time they talk about a big, bold new initiative ask them about the cost. How much was it and what were the alternative uses of what is after all our money (including, dare I say it, letting us keep it and use it ourselves).

I don’t begrudge a headline writer another fun drug story so long as there’s still a spot or two for the boring stuff.

Charlie Arlinghaus

October 23, 2013

As originally published in the New Hampshire Union Leader

The federal government doesn’t work because it doesn’t have to. Politicians are not capable of compromise in a natural state. They only compromise – or at least seek some vague common ground – when they are required to and have no other choice. Right now, competing politicians can’t even talk to each because they aren’t working on the same problem. State politicians aren’t nobler than the federals. They just have a common goal imposed on them externally.

Washington has long been a dysfunctional circus. Sometimes a new personality enters the mix but the broad insanity continues along more or less the same lines. In recent years, the same insanity seems to occur but slightly more frequently.

Every few months, we are treated to cable news channels blaring very serious with dramatic concern about the latest fiscal cliff or impending government doom. Tax cuts may be about to expire, some automatic spending cut may be about to take place, or perhaps 18% of the federal government might shutdown.

People should be forgiven for thinking each one of these scenarios is partly real but mostly exaggerated for the sake of ratings wars among the half of a percent of the population who bothers paying attention to cable news stations.

I want to believe these are real crises but we seem to have one every few months and they all sound about the same. One party or the other thinks we’ll have Armageddon if we don’t raise something or cut back something. And no one is quite sure the exact day of the supposed deadline. As the deadline approaches, someone clarifies that the actual deadline is a few weeks later than we first thought.

Ultimately, every crisis is averted. The solution is always about the same. As a temporary measure we do some slight variation of what we’ve been doing all along and it buys us another five or six months until we have the debate again. The cable channels will have new music and a new logo. The crisis will have a slightly different name but the big picture is about the same: nothing much changes.

Congress has some trouble changing because this is what they do. They all walk around a really nice old building surrounded by sycophantic staff holding their bags, an array of servants rarely seen outside Downton Abbey, and a very serious press corps talking to them in hushed tones about how statesmanlike they are compared to the other people who are causing the problem. It’s all very intoxicating and theatrical.

What they lack is an agreement on what exactly their job is. These fiscal cliffs all have a nominal deadline but it’s not clear what must be accomplished before the deadline. You would be excused for thinking they had to produce a budget, a balanced and binding document detailing spending and the revenues to pay for that spending. This is what states produce and it makes them functional even when they hate each other every bit as much as the federal patricians do.

But at the federal level we move from one stopgap to another, one temporary fix to another. There are no requirements or real deadlines.

This is their ultimate failure. They don’t act because they don’t have to act. For a politician, nothing is as painful as having to balance a budget. It involves saying no. Not everything can be done. Decisions have to be made, priorities balanced, and someone will be unhappy. No politician in his natural state wants to balance a budget. They do it at the state level because they are forced to. By a date certain, a balanced budget must be passed. No ifs, ands, or buts. If they fail, generally speaking the lower, pre-inflation level of spending for each agency and program continues. Saying yes to a couple of things always trumps saying no to everything so they act.

At the federal level, the consequence of not acting is happy. No decisions, fewer angry people, and all the hard stuff left for future generations. It is conventional wisdom among the establishment of both parties now that actually balancing the budget is both impossible and unnecessary.

Ultimately, federal politicians are children and they need to be treated like children. They need rules imposed on them from the outside. A balanced budget amendment shouldn’t be needed but it is. They need to have a goal imposed on them because they can’t be trusted to do anything responsible.

The sooner we start treating them like adolescents, the sooner they might clean their room.

 

Charlie Arlinghaus

February 15, 2012

Today we can buy three out of four categories of alcoholic beverages at the grocery store. Adding a fourth category constitutes a convenience not a catastrophe. It will be good for the state, good for revenues, and good for consumers.

When federal prohibition was repealed, then Gov. John Winant still wanted state prohibition but acquiesced to the legislative repeal so long as alcohol sales were a state monopoly sold at the three state liquor stores that opened in August of 1934.

Gradually sales expanded beyond the state-run retail outlets which have grown to 77. There are four categories of alcohol in New Hampshire: beer, table wines, higher alcohol fortified wines and liquor.

Today, the first three categories can be sold at grocery stores (licensed off-premise consumption outlets) but each step was a struggle against the same arguments made today for the retail monopoly.

Initially, non-monopoly beer sales were limited to a small number of outlets. Attempts to open sales to most grocery stores were opposed by the liquor commission. In the 1970s, retailers asked to be allowed to sell wine in addition to beer. For most of a decade the liquor commission fought this expansion with the same arguments made today against liquor sales.

Control advocates argued that selling wine in 1000 stores was too much and should be limited to the 77 state liquor stores. They argued that wine sales would merely cannibalize state sales and cost the state millions of dollars in revenues.

Based on experience, we now know that they were wrong. About half of all wine sales are in state-run stores and half in private outlets. The wholesale side of the business is still a strict state monopoly. Revenues didn’t decline and in fact experienced a significant increase. Just as important, consumers were able to purchase a legal product in 1400 locations instead of 77.

When fortified wines – wines with a higher alcohol content, usually for dessert – were added, the same objections were there but muted by past experience.

Today, you can buy beer, wine, and fortified wines all at your local grocery store. The one exception is liquor. A bill in the legislature would change that. Stores that currently sell beer, wine and fortified wine could add liquor to the shelf. After all, if a store is currently selling all the other alcoholic products, why would it not be able to also sell whiskey responsibly?

The proposal is very simple and does nothing else. The state would still control the import and wholesale operation of liquor. New Hampshire would still be a control state. New Hampshire would still operate liquor stores and private retailers would be required to purchase from the state as the monopoly wholesaler.

Just as when wine was opened up, opponents have claimed the state will lose money. It wasn’t true with wine. It wasn’t true with beer. It wasn’t true with fortified wine but this time they really mean it.

A study by the New Hampshire Grocers – advocates now and advocates when wine was opened up as well – suggests that the state will realize one-time revenue from initial shelf stocking (purchased from the state as the monopoly wholesaler) and licenses. In addition, they believe the state will see an annual revenue increase of $11 million (current liquor commission profits are about $130 million per year).

Opponents dispute those numbers, as they did when we expanded wine sales, but a 9% profit increase from a tenfold increase in retail locations is hardly unrealistic.

Another attempt to stop retail sales is by claiming liquor enforcement needs a dozen new agents. Yet no store that doesn’t already sell alcohol will be added. We already monitor and enforce sales at each of those outlets. How would the addition of a few products that are sold under the exact same rules as products they already sell change anything? Agency administrators like any excuse to add staff but this one is fairly easy to see through.

Finally, more stores mean more choices. The state-run stores necessarily limit products. Currently, locally produced John Stark vodka is about to be removed from state stores. It may be a reasonable business decision but surely with local grocers making their own decisions, the “Live Free or Die” vodka would find a few niches. Specialty drinks that have no room in the limited liquor stores would find a home somewhere.

It is natural for a control agency to want to maintain control. But there is no reason that stores that sell three categories of alcoholic beverages can’t sell a fourth. Arguments that were wrong about wine, wrong about beer, and wrong about fortified wine should be discarded. The change will be good for consumers and good for state revenues.

Charles M. Arlinghaus is president of the Josiah Bartlett Center for Public Policy, a free market think tank based in Concord. He can be reached at Arlinghaus@jbartlett.org.

 

By Grant Bosse

All three of New Hampshire’s Liquor Commissioners have lost the use of their state-issued cars, after racking up thousands of miles in personal use last year. Under a new law, state agencies have to reassign cars that are used more than 15% of the time for Non Business Use, unless a panel of state officials approves a waiver. That committee voted 4-1 against letting all Joseph Mollica, Michael Milligan, and Mark Bodi keep their state cars.

Documents filed with the Department of Administrative Services also appear to show that all three Commissioners originally understated the amount of personal miles they drove when seeking to keep their state cars.

Joseph Mollica

Liquor Commission Chairman Joseph Mollica drove a 2010 Chevrolet Impala a total of 13,836 miles in Fiscal Year 2011. In his waiver request to Administrative Services Commissioner Linda Hodgden, dated August 10, 2011, Mollica claimed to have accumulated 5,520 miles for non-business use, but the official report Hodgden presented to the Legislative Fiscal Committee states that Mollica drove 8,799 miles not on state business.

It would have cheaper for New Hampshire taxpayers to reimburse Mollica at $.55 per miles for the 5,037 miles he drove on state business. According to DAS estimates on the cost of maintaining state vehicles, it cost $1,770 to subsidize Mollica’s personal use of the vehicle.

Michael Milligan

Commissioner Michael Milligan had the fewest personal miles of the three, and the lowest percentage of non-business use. According to the DAS report, Milligan drove a 2008 Ford Fusion a total of 18,329 miles in FY11, 9,916 miles on official business and 8,413 for personal use. But his August waiver requests claims to have only accumulated 5,920 miles non-business use.

That request contained identical language to Mollica and Bodi’s letters, seeking to justify Milligan taking the state vehicle home at night.

This vehicle is used for commission business from the Commission’s offices in Concord and frequently from a home office. On a regular basis, Commissioner Milligan travels directly from his home to visit our 76 retail store locations. It is not unusual for him to spend the entire business day traveling from store to store. Commissioner Milligan also attends meetings throughout the state with business partners and other state officials. In addition, Commissioner Milligan attends special events held at our retail stores and other venues during evenings and weekends.

DAS estimates that Milligan’s personal use of a state vehicle cost $545 more than it would have to reimburse him for his official travel.

Mark Bodi

Commissioner Mark Bodi, who chaired the three-member panel until being demoted last year, drove by far the most personal miles, and the highest percentage of non-business use. According to the DAS report, Bodi drove just under 75% of his miles for non-business use. Bodi accumulated 17,099 miles on a 2006 Chevrolet Impala LS.

Bodi’s waiver request claims that he drove 8,710 miles for non-business use, but the DAS report concludes 12,793 miles were off the clock. DAS estimates the cost of those personal miles at $3,253 more than reimbursement for Bodi’s 4,306 miles driven on state business.

Hodgden tells New Hampshire Watchdog that if the Liquor Commission would like to have a state vehicle to use as a pool car for Liquor Commissioners to use for official travel, that request would likely be granted. The New Hampshire Liquor Commission did not returns requests for comment on this story.

The committee did approve the continued use of one Liquor Commission vehicle that had more than 15% of its miles for non-business use, unanimously approving a waiver for Investigator Glen Bullock to keep using a 2004 Chevy Impala. In FY11, Bullock drove the car 4,877 miles, 1,360 of which were non-business use. DAS estimates that letting Bullock use the vehicle saved taxpayers $343 versus paying Bullock for $.55 per mile for his official travel. A fifth Liquor Commission car that tripped the 15% threshold was reassigned by the Commission. The Liquor Commission has 45 state vehicles in its fleet.

NH Liquor Store photo: Grant Bosse
Commissioner photos: NH Liquor Commission

NH Liquor Commission State Vehicles Requests