Yesterday was National Lemonade Day. Over at the Mercatus Bridge blog, Jennifer Skees and I used the opportunity to highlight the increasing regulatory crackdown on kids operating ventures without first seeking the proper permits from local authorities. We ask, “wouldn’t it be better to teach them the value of hard work and entrepreneurial effort instead of threatening them with penalties for not getting costly permits to do basic jobs?” Here’s our answer:

Today is National Lemonade Day. For many Americans a lemonade stand was their first experience in entrepreneurship. But unfortunately, this time honored tradition that teaches the value of hard work, entrepreneurship, and innovation may be under threat from overzealous grown-ups.

Should we really force kids to get licenses to start lemonade stands, sell bottles of water outside a ballpark, or mow lawns for a little extra money? And wouldn’t it be better to teach them the value of hard work and entrepreneurial effort instead of threatening them with penalties for not getting costly permits to do basic jobs?

Recent news stories have highlighted examples of kids being confronted with local regulations that essential tell them not to be entrepreneurial until they’ve gotten someone’s blessing–or else face fines or other penalties for those efforts.

Out in San Francisco, for example, a neighbor threatened to call the police on an eight-year-old girl selling water to raise money for a trip to Disneyland after her mother had lost her job. The neighbor berated the little girl for “illegally selling water without a permit.” Luckily, national outrage seems to have fallen in favor of this rogue entrepreneur instead of “Permit Patty.” But this is far from an isolated case.

Another story went viral earlier this year involving kids and lemonade stands. Country Time lemonade pledged to pay the fines received or the permit cost for children’s lemonade stands. Who thought we’d reach the day when we need a Lemonade Legal Defense Fund? But just prior to the launch, Stapleton, Colorado police were called to shut down the lemonade stand of  four and six year-old brothersfor failing to have a business license. Kids who probably can’t read or fill out the necessary forms are expected to obtain a formal license for a tradition that dates back about 120 years.

Kids are confronted with other meddlesome local permitting rules even when they aren’t selling food or beverages. The town of Gardendale, Alabama made news last year after attempting to charge a teenager $110 for a business license for mowing neighbors’ lawns during the summer to earn money for a mission trip. A local professional lawn service had apparently pressured local parents about the need for kids to have licenses to mow. The city later clarified teenagers would be allowed to mow lawns for a little extra money without needing a license to do so as long as the work was part-time and they were students.

Should we have expected kids to seek permits in these cases? Some sticklers might say yes, we should. After all, it’s the law!

But complying with the law is costly in two important ways. First, the actual fees can be exorbitant. In San Francisco, for example, the filing fee for a “peddler’s permit” costs $330-$525 depending on whether you are selling non-food or food items. Then, if you get the city’s blessing, you have to pay an additional $166-$624 annually for a license to serve the community. It’s safe to say that most kids and their parents probably could not afford that expense.

But the more important cost might be the mental transaction costs or general hassles associated with navigating the labyrinth of red tape that entrepreneurs must confront to get new ventures started. The very act of going through a laborious, confusing, and time-consuming permitting process will be too much for many to bear, especially kids. When a mother tried to get a license for a lemonade stand in Texas, she was told that an inspection by the health department would also be necessary because of the “bacteria that can grow in lemonade.” As a result some children and parents have gotten creative by not “selling” these dangerous products but instead offering it “free” but accepting donations.

The costs of permitting have important real-world implications. They are sending a clear message to kids and their parents: Don’t even bother trying to be entrepreneurial unless you are willing to deal with a world of regulatory pain. Worse yet, to the extent they learn anything by attempting to comply with such silly rules, it’s probably only a lesson in how to manipulate a political process for your own gain. All too often, many incumbent businesses who already worked their way through the system figured out how to exploit it for their own gain to keep competitors out. They then become the guardians of the licensing systems

This is what Philip K. Howard, chair of Common Good, calls this  The Death of Common Sense, in a book of the same name. “Like sediment in a harbor,” he argues, rules and regulations in the US have accumulated, “until most productive activity requires slogging through a legal swamp. “It’s degenerative,” he says. Indeed, laws and regulations like these sap the entrepreneurial spirit of young Americans and discourage them from taking the initiative and learning important skills they will use throughout their lives.

A common refrain of just about every generation of adults is that the younger generation doesn’t work as hard as their generation did. Such “kids-these-days!” complaints are almost always off-base. But they are particularly outlandish when it’s the adults who are acting juvenile by refusing to reform illogical and costly rules that do nothing to protect the public but make it harder for young people to pursue their dreams and engage in entrepreneurial activities.

We shouldn’t actively encourage kids to break the law, of course. But what happens when rules and regulations utterly defy common sense, as these and countless others do today? Perhaps a little “evasive” entrepreneurialism and civil disobedience is the answer. Luckily, public interest law firms like the Institute for Justice, the Goldwater Institute, and the Pacific Legal Foundation already exist to defend our general right to earn a living. Sometimes it will be necessary to push our luck against what Goldwater’s Timothy Sandefur calls “the Permission Society” if we hope to get policymakers to wake up to the illogical and unfair nature of archaic old licensing regimes.

Luckily some states have started to realize that these burdensome licensing and permitting requirements may have gone too far and at least in some cases are not serving their original purposes. For example, Utah recently passed a law that exempts lemonade stands and other similar child-run businesses from permitting requirements. And recently health inspectors helped a Minneapolis 13-year-old get the necessary permits and paid the costs of the licenses to keep his hotdog stand open. But on a broader front, the right to earn a living is tied both to the value of entrepreneurship and the right to innovate. It is far too easy for incumbents to use licensing schemes to keep out new innovations like ride-sharing and home-sharing. Instead of focusing on raising requirements to prevent new innovations and protect existing industries, we should look to the right to earn a living as a way to even the playing field by reducing the burdens for everyone.

Kids are used to asking permission from their parents, but what are we teaching them when every attempt to do a job or earn a little money also requires endless permission slips from the government? Studies have shown that helicopter parenting makes children struggle emotionally and behaviorally later in life. Imagine how much worse that problem is when the government serves as the ultimate helicopter parent, demanding constant permission to engage in any kind entrepreneurial acts? It seems if we want to stay a nation of innovators and entrepreneurs, the least we can do is tell the kids to stick to asking “Mother may I?” of just their mothers.

Additional Reading:

• Jennifer Skees, “Do You Need a License to Innovate?”, The Bridge , June 29, 2018.
• Adam Thierer, “Making the World Safe for More Moonshots,” The Bridge , February 5, 2018.
• Jennifer Skees & Trace Mitchell, “Will The Electric Scooter Movement Lose Its Charge?” The Bridge , July 18, 2018.
• Jennifer Skees, “Should You Be Able to Fix Your Own iPhone,” Plain Text , June 18, 2018.
• Andrea O’Sullivan & Adam Thierer, “3D Printers, Evasive Entrepreneurs and the Future of Tech Regulation,” The Bridge, August 1, 2018,
• Adam Thierer, “The Pacing Problem and the Future of Technology Regulation,” The Bridge , August 8, 2018. 
• Adam Thierer, “Evasive Entrepreneurialism and Technological Civil Disobedience: Basic Definitions,” The Bridge , July 20, 2018.

REAL ID continues its long, slow failure. The federal government’s national ID plans continue to bash against the shoals of state and popular opposition.

Late last month, the governor of Utah signed H.B. 234 into law. The bill prohibits the Utah driver license division from implementing REAL ID. That brings to 25 the number of states rejecting the national ID law, according to the Tenth Amendment Center.

And the state of Nevada, one of few states that had been working to get in front of REAL ID, is reconsidering. With wait times at Las Vegas DMVs reaching two to four hours, the legislature may soon allow a temporary REAL ID implementation measure signed last year to lapse—this according to the Ely (NV) News.

Congress has attempted to circumvent the growing state opposition to REAL ID with the now-stalled PASS ID legislation. It basically would rename REAL ID so as to nullify the many state resolutions and laws barring implementation of the national ID law because they refer to the May 2005 “REAL ID” law specifically.

But PASS ID is the same national ID, it has all the privacy issues of REAL ID, and its costs would be as great or greater than REAL ID.

That doesn’t mean national ID supporters in Congress won’t try to sneak the REAL ID revival bill into law sometime later this year, of course . . .

Ben Edelman of the Harvard Business School has just released an interesting new study in the Journal of Economic Perspectives entitled, “Red Light States: Who Buys Online Adult Entertainment?”  Using data he obtained from a top-10 seller of adult entertainment, Edelman examined adult website subscriptions on the zip code level and found that conservatives seem to be every bit as interested in pornography as liberals. In fact, “Subscriptions [to adult entertainment sites] are slightly more prevalent in states that have enacted conservative legislation on sexuality” and “subscriptions are also more prevalent in states where surveys indicate conservative positions on religion, gender roles, and sexuality.”  He also finds that:

In states where more people agree that “Even today miracles are performed by the power of God” and “I never doubt the existence of God,” there are more subscriptions to this service.  Subscriptions are also more prevalent in states where more people agree that “I have old-fashioned values about family and marriage” and “AIDS might be God’s punishment for immoral sexual behavior.”

On the whole, these adult entertainment subscription patterns show a remarkable consistency: all but eleven states have between two and three subscribers to this service per thousand broadband households, and all but four have between 1.5 and 3.5. With interest in online adult entertainment relatively constant across regions, there’s little sign of a major divide.

But it’s not just Internet porn where we see this trend at work.  As I noted in my law review article, “Why Regulate Broadcasting?” we’ve seen a similar trend at work with television. When you look at some of the TV shows that conservatives and religious groups gripe most about, you might be surprised to know that it is conservatives who make those shows as popular as they are!

As Bill Carter of the New York Times reported in a 2004 article, “Many Who Voted for ‘Values’ Still Like Their Television Sin,” Nielsen ratings data shows that in many Republican-leaning “red state” markets, such programs garner higher ratings than in many Democratic-leaning “blue states.” For example, in the counties that constitute the greater Atlanta television market, ABC’s dramatic comedy “Desperate Housewives” was the top-rated show even though nearly 58 percent of voters in those counties voted for President Bush.  Similarly, in the traditionally conservative Salt Lake City market, where President Bush captured over 72 percent of the vote, the top four shows were “C.S.I.,” “C.S.I. Miami,” “E.R.,” and “Desperate Housewives.”

Likewise, in a 2004 column about “The Great Indecency Hoax,”  NY Times columnist Frank Rich noted that the same trend holds in conservative Oklahoma City, where “Desperate Housewives” is more popular than it is in Los Angeles, as well as Kansas City where the show is bigger than it is in New York City.  Rich quoted sociologist Herbert Gans who explained the phenomenon as follows: “For some people it’s a case of ‘I am moral therefore I can watch the most immoral show.'”

Such findings call into question the logic of traditional “community standards”-based regulatory efforts. Indeed, it is unclear how lawmakers can determine the relevant “community standard” for purposes of speech and content regulation when some of the most conservative communities in America are downloading as much porn as Edelman’s study finds, or when conservatives are watching smutty TV in greater numbers than liberals do.

The better approach, as I’ve argued here before, is to replace “community standards” with “household standards.”  That is, it would be optimal if public policy decisions regarding content took into account the extraordinary diversity of citizen / household tastes and left the ultimate decision about acceptable programming to them.  That’s especially the case in light of the fact that less than 32% of U.S. households have any children in them, and those homes that do have children have plenty of tools and methods at their disposal to control objectionable content. Let’s empower parents to make decisions for themselves and their families so that Uncle Sam doesn’t need to play the role of national nanny for all of us.

• Edelman’s mention of porn consumption in Utah reminded me of this passage from Jeff Rosen’s 2004 essay on “The End of Obscenity” (which I discussed in greater detail here):

  three years ago, when a local video retailer in Utah was prosecuted for peddling hard-core pornography, he successfully argued that his products were consistent with what his neighbors were watching on pay-per-view: in an age of nationally distributed hotel pornography, there was little difference between the consumption habits of hotel guests in Salt Lake City or Las Vegas. Pornography is everywhere, suggesting that there is no national consensus against it and no vast disparity from one locale to another.

  Seems that those Utah residents are a horny bunch!  Maybe their new motto should be, “What happens in Utah, stays in Utah.”