April 11, 2019
My name is Marc Hyden. I am a Georgia resident and the Director of State Government Affairs for the
R Street Institute, a nonprofit, nonpartisan public policy research organization. Our mission is to engage in policy research and outreach to promote free markets and limited, effective government in many areas. Today, I write to urge you to sign SB 214 into law.
The State of Georgia has the 14th most burdensome occupational licensing laws in the country. These laws force prospective workers to clear costly and time-consuming hurdles in order to make a living. Often, these barriers are wholly unnecessary and do little to benefit the public.[i] Indeed, the current law needlessly requires a would-be barber or cosmetologist to be deemed a person of “good moral character” before being permitted to work.[ii] This goes far beyond what is needed, and thankfully, SB 214 works toward easing this restriction.
“Good moral character” clauses give licensing boards broad power to reject licensing applications based on ambiguous guidelines. This can prevent the formerly incarcerated from entering the workforce, which keeps them out of work and in poverty, thus encouraging them to return to crime to make a living.
The problems associated with occupational licensing go far beyond just barbers and cosmetologists. In fact, the state of Georgia has weaponized occupational licensing regimes. To date, Georgia is one of a shrinking minority of states that are empowered to suspend the occupational licenses of those who fall behind on their student loans. States are increasingly abandoning this model, and for good reason.[iii]
When such suspensions are imposed, licensees are prohibited from working in their profession, which merely makes it harder to repay their debts. After all, it is difficult for individuals to re-enter satisfactory repayment status when they do not have a job. This policy essentially creates joblessness and subsequently pushes the newly unemployed into poverty. These people then become more likely to apply for taxpayer-funded assistance. This only increases the burden on working Georgians. Government-created poverty harms more than just the borrowers. It impacts the families who rely on their income. Indeed, lost wages can mean the difference between providing and failing to provide shelter and nourishment for loved ones.
While originally designed to hold borrowers accountable and prevent defaults, this policy has failed. As of 2015, the average federal student loan default rate was lower in states without revocation authority than it was in Georgia. Thus, the threat of suspension does not appear to be effective at discouraging defaults. While it is certainly important to encourage debt repayment, this must be done responsibly. Fortunately, we already have time-tested tools to do so at our disposal. Currently, delinquent borrowers’ wages can be garnished, tax returns or social security payments seized and liens assessed against their property.[iv]
Thankfully, late in the session, the SB 214 conference committee included language from Sen. Beach’s SB 92 and Rep. Turner’s SB 42 in SB 214 to address these issues, and it passed both chambers overwhelmingly. The R Street Institute has worked closely with Sen. Beach and Rep. Turner on these measures since summer 2018. What’s more, a large coalition of organizations have signed onto our enclosed coalition letter stating that the current policy is imprudent.[v]
The bottom line is that Georgia should not be in the business of creating unemployment and poverty or needlessly increasing the burden on taxpayers. Instead, we should do the opposite, which is why we respectfully implore you to sign SB 214 into law.
Thank you for your time,
Director, State Government Affairs
R Street Institute
[i] Carpenter, Dick M., et al., “License to Work” 2nd Edition, Institute for Justice, November 2017.
[ii] Chapter 10 of Title 43 of the Official Code of Georgia Annotated.
[iii] Weissmann, Shoshana, and Dieterle, Jarrett, “How states use occupational licensing to punish student loan defaults,” R Street Institute, June 27, 2018.
[iv] Hyden, Marc and Dieterle, Jarrett, “R Sheet on Georgia Suspension of Occupational Licenses for Student Loan Defaults,” R Street Institute, November 7, 2018.
[v] Galloway, Jim, “The Jolt: In the final hours, lawmakers allow metro Atlanta transit talk to proceed,” Atlanta Journal Constitution, April 3, 2019.