Michigan scalping law is ‘consumer protection’ gone wrong
So-called “consumer protection” has evolved into a major legislative preoccupation, which would be fine if it was mostly related to protecting citizens from injury – physical or fiscal.
Alas, despite the emotional rhetoric politicians deploy in their floor speeches, much of the legislative output is more targeted at protecting special interests than at keeping the market honest and efficient.
Licensing bills, in particular, are simply impediments to potential competitors. Many of them are ridiculous – like the 1,200 hours of study and three year’s apprenticeship required by one state to practice hair braiding; mandatory licenses for florists and interior designers; and the laws being passed to protect existing transportation monopolies from the new share economy.
Michigan has a law on the books that prohibits reselling tickets to events for more than face value. What that means is that people who incur charges from services like Ticketmaster charges can’t even recoup their out-of-pocket expenses by reselling the ticket should they be unable to attend the game, concert or other event.
It’s a criminal law, and theoretically one could be imprisoned for three months for a violation. At a legislative hearing to modernize and decriminalize this behavior at which I testified, a pastor of a suburban Michigan church told how he had been un-theoretically arrested, fined and forced to pay court costs for trying to sell some of the unused tickets his church had bought for a congregation outing outside the event.
Most of the attention on ticket sales reflects consumer interest in sports and popular music concerts. It is enormously entertaining to watch another run for the Triple Crown, or to see the world’s second highest-paid athlete make an exquisite crossing pass which allows Portugal to tie the United States in last few seconds of a World Cup match. I wasn’t personally affected when the Electric Forest concert this weekend in western Michigan sold out, but I did have friends there and can’t wait to hear about their experiences. A lot of people will pay plenty to have that kind of memory.
About half the states have some kind of prohibition on ticket resales, either a special law to protect NASCAR races, NFL games, events at universities and the like, or, in 11 of those states, a general prohibition. Of those, all but three states allow commercial resellers to charge a service fee. (Interestingly, two states – California and Arizona – specifically allow ticket scalping by statute.)
Respected media organizations, public policy institutes and the American Bar Association have all concluded that we have way too many criminal laws. One recent book relates the story of a 12-year-old girl arrested on the Washington, D.C. subway for eating a single french fry. As former Sen. Daniel Patrick Moynihan observed, “We started with a few laws, and now we have catalogs of offenses.”
The antiquated Michigan law is a pretty good example of why there is such a strong libertarian streak emerging in the country. The legal landscape is so littered with criminal laws that nearly every citizen is a violator at least once a day.
Michigan is way out of line with her sister states by slapping criminal sanctions on mostly unsuspecting residents who have tickets to unload; want at least their money back; and may hope to match up with somebody who wants to be there so badly they will happily pay more.
