From the Institute for Justice Press Release
Arlington, Va.—Erroll Tyler, an African-American entrepreneur from Melrose, Mass., scored a major victory for economic liberty on Friday, June 1, by showing that it is possible to fight city hall and win.
The Massachusetts Department of Public Utilities (DPU) granted Erroll a jitney license to operate his amphibious-vehicle tour service. Erroll was appealing a denial by the city of Cambridge. During the course of three applications and nearly three years of battling bureaucracy, officials in Cambridge, Mass., continually denied Erroll the license he needed to start his entrepreneurial venture, Nautical Tours, because city officials decided that the city did not “need” his services. The DPU struck a significant blow for economic liberty in forbidding the Cambridge bureaucrats from using their power to protect existing tour operators from honest competition. This naked protectionism has been costing Cambridge jobs, driving up prices and violating Erroll’s constitutional right to earn an honest living in the occupation of his choice. In short, Erroll was faced with existing, irrational government regulation.
“Erroll has achieved an important victory for entrepreneurs over bureaucracy,” said Jeff Rowes, a staff attorney with the Institute for Justice, the public interest law firm that represents Erroll. “Governments like Cambridge need to recognize that economic liberty is as much a part of our Constitution as the right to free speech. The constitutional right to earn an honest living is more important than protecting other tour operators from competition and we applaud the DPU for recognizing this fact.”
Even though the only legitimate purpose of government licensing is to protect public health and safety in carefully tailored ways—such as requiring buses to be insured, well-maintained and operated by a qualified driver—in the transportation industry, an entrepreneur has to do more than satisfy objective criteria like these. To receive a “jitney” license, which is required to pick up and drop off passengers along a fixed route, state law and city ordinances require an entrepreneur to prove that his or her new venture also serves “public convenience and necessity.” Unfortunately for entrepreneurs, a proposed transportation business is often only “convenient and necessary” if the entrepreneur can prove that the new company won’t compete with existing businesses. It is not enough for an entrepreneur to show that he will provide consumers better service at a better price. He has to further show that existing companies cannot meet the demand. Typically, existing companies oppose the issuance of any new jitney license.
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