Street vending has been a path out of poverty for Americans. And like other such paths (say, driving a taxi), this one is increasingly difficult to navigate. Why? Because entrenched interests don't like competition. So they lobby their powerful friends to erect high hurdles to upstarts. It's an old story.
Now, growing local governments are crushing street vendors.
The city of Atlanta, for example, has turned all street vending over to a monopoly contractor. In feudalist fashion, all existing vendors were told they must work for the monopoly or not vend at all.
"Vendors who used to paying $250 a year for their vending site must now hand over $500 to $1,600 every month for the privilege of working for the monopoly," wrote Bob Ewing in The Freeman. Ewing works for the Institute for Justice, the libertarian public-interest law firm that defends victims of anticompetitive regulation.
IJ has sued the city on behalf of two popular vendors.
In Hialeah, Fla., if you operate a flower stand too close to a flower store or if you're not constantly moving, you can be arrested.
Institute lawyer Elizabeth Foley says the regulations make "it virtually impossible to be an effective street vendor. You can't be within 300 feet of any place that sells the same or similar merchandise. That's absolutely ridiculous for the government to use its power to enact a law like that. ... These people are just trying to make an honest living, and the city is making it impossible to do so."
The law does seem designed to cripple street vending.
"You have to be in constant motion, which is completely unsafe."
Raul Martinez, the mayor when the law passed, defended the rule.
"You don't want to have everybody in the middle of the streets competing for space on the sidewalk without some sort of regulations. In the city of Hialeah, we're not overregulating anybody."
He says one purpose of the law is simple fairness: Street vendors don't pay property taxes. Brick-and-mortar stores must.
"They also create jobs," Martinez said. "What we did back then is we got all the groups together and we came with an ordinance that was satisfactory to all of the parties at the time."
But they couldn't have gotten "all the groups" together because people who hadn't yet entered the business weren't included. How could they have been? No one knew who they would be. What the mayor did was get the established guys together. Such "fairness" regulation kills job growth and reduces consumer welfare because the entrenched interests write rules that cripple new competition.
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