This is my third post regarding Nebraska’s requirement that household goods (HHG) movers and passenger carriers obtain a certificate of public convenience and necessity (CPCN). In my previous posts I’ve mentioned that a bill was introduced during the 2019 legislative session, LB461, that would repeal this requirement.
The Platte Institute is grateful to Senator Curt Friesen for introducing LB461. I testified in support of this bill at the Transportation and Telecommunications Committee hearing. Marc, whose story I shared in my second CPCN post yesterday, also testified. The opposition outnumbered us, as expected. The bill remains in committee currently.
Wyoming, South Dakota and Iowa do not have CPCN laws.
Kansas, like Nebraska, requires a CPCN for HHG movers and passenger carriers. Like Nebraska, legislation was introduced in 2019 to repeal their CPCN law and that bill still remains in committee.
In 2012, the Missouri legislature repealed the state’s CPCN law, replacing it with statute requiring that a mover be “safe, insured, and qualified.”
The Platte Institute sees this issue as a no-brainer. Get this economically burdensome law off the books and open Nebraska up for business. Let Nebraska consumers have a voice and a choice instead.
Free market alternatives to the CPCN exist.
Adam Smith proposed the concept that when pursuing their self-interest, entrepreneurs are guided by the “invisible hand” of market prices to allocate resources in ways that benefit society. When prices reflect that consumers value the goods and services being produced more than their production costs, “producers seeking personal gain will supply them.” Competition forces entrepreneurs to allocate resources efficiently if they want to be successful. Because of the presence of the invisible hand, there is no need for government regulation for supply or price controls to protect the public.
Not only does the invisible hand help the free market succeed, there are other options to assure market success. HHG business owners could guarantee compensation for items or premises damaged, guarantee date and times for delivery, or provide a “guaranteed-not-to-exceed” estimate prior to a move occurring.
Reputation serves as a signal of quality to consumers, and the provision of information by outside parties can be helpful. The information found in Google reviews, at the Better Business Bureau, on Yelp and on Angie’s List allows consumers to determine the quality of provided services through access to consumer feedback. Access to this information allows consumers to determine if a business will meet their needs.
Entrepreneurship is not just about profit; it is assuring that society’s unmet needs are being met. Entrepreneurs have a gift for recognizing a consumer need exists, realizing the market has left the need unmet, and developing a way to meet that need.
Repealing Nebraska’s CPCN requirement for HHG moving and passenger carrier industries would be a step in the right direction. When the government denies entrepreneurs the opportunity to enter the market, the costs of goods and services increase, the quality of goods and services decreases, and consumer choice is limited as innovation is stifled.
Starting a business is not easy. Entrepreneurs should not have to expect they will never get a chance just because existing businesses do not want competition.
Let me leave you with a final thing to consider. Pretend for a moment that a CPCN requirement was put in place for Nebraska's restaurant industry. What would have happened if Godfather’s Pizza had to get permission from Valentino’s to open back in 1973?