“For quite some time, The DPC Journal has been monitoring happenings in other free market businesses, non-healthcare related [Georgia and elsewhere across the country,] says Michael Tetreault, Editor in Chief of The DPC Journal. “There is a lot that can be learned by the regulatory treatment given to other free market businesses … as well as direct-to-consumer business concepts and how certain stakeholders and regulatory bodies view these emerging ideas. Some involve the craft brewing industry vs. large beer distributors, Tesla Motor Company vs. automotive dealer associations and the like. DPC should be watching carefully how other State regulatory persons and stakeholders treat other Free Market business concepts and how can impact DPC in the future.”
According to Townhall.com, “…a new Georgia Craft Brewers Guild is ramping up to challenge the state’s three-tier alcohol distribution system, which prevents brewers from selling directly to consumers. Neighboring states without this restriction have seen a booming microbrewery industry while the Brewers Guild says Georgia is lagging behind. Tesla Motors is currently locked in a battle with the existing franchise auto dealers over whether Tesla can sell cars directly to consumers. Franchise auto dealers say they protect consumers, while Tesla argues that only a manufacturer can build out the infrastructure, like specialized fast-charging stations, and train the staff to sell and service a new kind of auto. Finally, rambunctious upstarts Uber and Lyft are challenging the existing taxi cab licensing structure and appear to have found a powerful ally in Atlanta Mayor Kasim Reed.” According to a report this week from The Citizen, “Insurance companies blocked direct primary care agreements between patients and doctors that even Obamacare allows. Every year, it seems, another industry seeks professional licensing to limit competition. The Obama Administration as well as free-market groups around the nation have highlighted the negative consequences of these regulations. Even so, this year legislators regulated lactation consultants and attempted to regulate low-voltage contractors; last year it attempted to regulate locksmiths; in 2013 Georgia was the third state to require music therapists to be licensed. Even interior decorators are licensed.”
Not many bright spots under Gold Dome this year
Missed opportunities. That’s the best description of the just completed legislative session.
The General Assembly is often, and appropriately, chided for passing last-minute bills with little debate or study. This year, several study committees put in work prior to the session to craft comprehensive reforms in education, tax and welfare reform. The work was for naught; none of the proposals passed.
Education was pushed to the forefront when Georgia Gov. Nathan Deal appointed an Education Reform Commission in January 2015. Replacing Georgia’s 1980s-era funding formula was the primary focus, a feat two previous governors had attempted and failed.
After months of meetings and several fits and starts, the commission released its 86-page final report full of good ideas in December. With influential lawmakers on the commission, pundits predicted smooth sailing. For unknown reasons, between December and January the governor pulled all 44 recommendations from the agenda.
During the bruising debate over transportation funding last year, a promise of tax reform in 2016 was inserted into the bill to garner votes from fiscal conservatives. After the House refused to appoint members to the promised joint tax reform committee, the Senate attached tax reform language to an existing House bill.
The six-page bill simplified the tax code by reducing six tax brackets down to one and lowering the tax rate to 5.4 percent – 10 percent lower than the current top rate and just below North Carolina’s recently lowered rate.
A study by Georgia State University projected the result would be lower taxes or no change for the median and average taxpayer in every income group. The cost would have been less than the annual cost of Georgia’s film tax credits. The proposal also would have helped small businesses, improving Georgia’s ranking on the Tax Foundation’s State Business Tax Index from 39th to 18th. Despite multiple hearings, the bill died without a vote in the House.
Proposed welfare reforms included enhanced work requirements, a cash diversion program and common-sense fraud prevention practices. Reforms that could have moved Georgia from 44th to ninth on the Heartland Institute’s national Welfare Reform Report Card died with the bill.
On a positive note, Georgia remains in the national spotlight after legislators passed this year’s recommendations from the Georgia Council on Criminal Justice Reform; joined 21 states in allowing terminally ill patients the “right to try” experimental drugs in the last stages of federal trials; and took a practical step toward authorizing transit funding for the City of Atlanta and parts of Fulton County.
In the final two days of the session, legislators made progress in healthcare, approving funding to expand charity clinics serving the indigent and uninsured, a tax credit for individuals donating to rural hospitals and a Senate study committee to examine an insurance premium assistance program for low-income Georgians ineligible for Medicaid.
Unfortunately, a troubling trend continues: well-connected special interests using state government to thwart competition.
Examples abound. Beer distributors blocked small craft breweries from direct sales, which wineries have done for years. Hospitals blocked reform of certificate of need laws that limit competition. Trial lawyers blocked medical malpractice reform. Dentists blocked dental hygienists from expanding their scope of practice. Public education lobbyists blocked school choice for working-class families and active duty military personnel. Insurance companies blocked direct primary care agreements between patients and doctors that even Obamacare allows.
Every year, it seems, another industry seeks professional licensing to limit competition. The Obama Administration as well as free-market groups around the nation have highlighted the negative consequences of these regulations. Even so, this year legislators regulated lactation consultants and attempted to regulate low-voltage contractors; last year it attempted to regulate locksmiths; in 2013 Georgia was the third state to require music therapists to be licensed. Even interior decorators are licensed.
Do you feel safer?
In the most egregious 2016 example of protectionism, optometrists successfully outlawed a low-cost competitor already operating successfully in 44 states. The firm provides affordable online refraction exams so individuals ages 18-40 with no other health issues can easily update their prescriptions.
The biggest losers in this trend toward protection of the status quo are the poor and middle class, who face higher prices for services, lack of access to health care and education, and fewer job opportunities.
Next year, perhaps Georgia’s leaders will focus on empowering individuals, reducing barriers and supporting entrepreneurs and small businesses. In other words, economic opportunity for all, not special treatment for some.
[Kelly McCutchen is President of the Georgia Public Policy Foundation, an independent think tank that proposes market-oriented approaches to public policy to improve the lives of Georgians.]