Sidestepping State-Licensure with Professional Associations


One of the purported “benefits” of the state is licensure—a state-certified threshold presupposing a minimal level of competence in each industry or field. Unfortunately, a lot of times it’s not.

Take my own industry, for example, real estate. I’m a licensed broker of real estate which for me has been an incredibly fulfilling career that I am very much passionate about. To put it simply I am a libertarian that represents buyers or sellers so that they ideally get the most out of their dollar in exchange for selling their private property rights. It doesn’t get much more on the nose than that. But my licensure isn’t what my clients benefit from.

Most of my power is derived from my local association which is a voluntary and private group of colleagues I syndicate market information with. According to the National Association of Realtors, about 89% of all home sellers sell their home through a Realtor in good standing with their local association. That means that more than 4/5 of homes are doing so with an experienced professional keeping in compliance and assuming all transactional liability. That’s not half bad.

Now, where in there does it say that my license did any work? It didn’t. I’m effective because of a professional association that holds me to a consensual code of ethics in exchange for said information, not because I gave the government their extortion dues. If I don’t conduct myself within their standards I’d get kicked out and lose access to the Multiple Listing Association where we aggregate housing data and availability.

For access to our association one needs only to be licensed. If the state had higher minimum criteria for the people responsible for hundreds of thousands of dollars’ worth of capital I may consider that a sufficient clause for admittance but at present, you need only be a holder of a GED, not be a violent felon, pass a 165-hour course (here in Colorado, it’s different in other states), and pass two tests. While it’s a good thing that convicted thieves aren’t traipsing their ilk through your house as licensed professionals that’s still a pretty low bar if you ask me.

Professional associations would be a great alternative to forced licensure because there’d be at least an inkling of accountability. At present, the conversations tend to stop at “I’m licensed” when discussing credentials when somebody could be so much more than just licensed. While I personally have both I would not chuff at my association admitting someone with a full bachelor’s degree in real estate nor at someone who did a year-long internship at a reputable brokerage.

And I would gladly extend such graciousness to all manners of professional industries. One needn’t be licensed as an architect to draw a beautiful building. I think I’d like to see a portfolio over a license. And I’d definitely prefer to see good standing with a relevant association that has a voluntary code of ethics required for admittance.

There are other industries that are largely self-regulated as well. Becoming a tattooist isn’t something you can give a legal ominous dominous for and then *poof* you’ve got a talented artist. Largely to become a tattooist you have to be a gifted artist to even get an apprenticeship and then you work and hustle until that shop will consider hiring you. And not all states require a license to tattoo either, it’s often mostly through county or local health departments for sanitation purposes.

In my opinion, an individual ought to send as many signals to the market about their competence that they can. Licensure is one route but there are all kinds of certifications and degrees one can get. Associations, in my opinion, would be a great option and alternative to state-issued licenses for most if not all professional service-sector industries though and they should be given more autonomy in regard to admittance.

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Jesse Campbell

Jesse Campbell is a proud husband and father residing in the heart of Colorado’s Front Range. He got his Bachelor’s degree in Political Science from the University of Colorado and spent four years in the Marine Corps prior to selling real estate. In his spare time, Jesse likes to tell people how much he’s read of Ludwig Von Mises’s Human Action and spreading his opinions as facts on social media.