WEBVTT - Texas Wanted Him to Spend 750 Hours Learning the Wrong Job

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<v Speaker 1>And we returned to our American stories. And now it's

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<v Speaker 1>time for another rule of law story. As a part

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<v Speaker 1>of our Rule of Law series, where we show what

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<v Speaker 1>happens when there's either an absence or presence of the

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<v Speaker 1>rule of law in our lives. Here's a story about

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<v Speaker 1>a landmark case on economic freedom in the state of Texas.

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<v Speaker 2>My name is Wesley Hottett. I'm a senior attorney with

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<v Speaker 2>the Institute for Justice. I've worked at IJ since I

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<v Speaker 2>graduated from law school in two thousand and eight, and

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<v Speaker 2>my first job was at ij's then New Texas office

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<v Speaker 2>in Austin. I was working there a little bit late

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<v Speaker 2>one night, I think it was around six point thirty,

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<v Speaker 2>and a couple of guys came into the office after

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<v Speaker 2>everyone else had left. I didn't know them, but I

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<v Speaker 2>went out to the front and introduced myself. They were

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<v Speaker 2>Ash Patel and and ver Eli Satani, to business owners

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<v Speaker 2>who said that they had a problem with the state

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<v Speaker 2>and they wanted to know if I would agree to

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<v Speaker 2>talk to them about it. From there, I learned that

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<v Speaker 2>their business was being threatened with being shut down because

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<v Speaker 2>they employed eyebrow threaders. These are typically South Asian women

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<v Speaker 2>who use a beauty technique involving nothing but a single

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<v Speaker 2>strand of cotton thread. They put tension on that form

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<v Speaker 2>a kind of lasso, and it allows you to precisely

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<v Speaker 2>remove hair around the eyebrows for beautification. And when ash

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<v Speaker 2>and had set up their business, they told me they

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<v Speaker 2>looked at Texas's cosmetology laws and saw nothing specifically about threading.

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<v Speaker 2>They plowed ahead like all good entrepreneurs do, without asking permission,

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<v Speaker 2>and it turned out that the Texas Department of Licensing

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<v Speaker 2>and Regulation had, after the fact, decided that they thought

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<v Speaker 2>threading was cosmetology. It followed that everyone that worked for

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<v Speaker 2>ash and Anver needed a cosmetology license. None of them

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<v Speaker 2>had one. And as we later discovered, the cosmetology schools

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<v Speaker 2>weren't teaching threading or testing anyone. They were going to

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<v Speaker 2>go learn other people's cosmetology techniques. They were going to

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<v Speaker 2>go learn other people's jobs just to qualify to continue

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<v Speaker 2>doing their jobs. And you're talking about women that had

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<v Speaker 2>been doing this professionally for thirty years discovering, you know,

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<v Speaker 2>at the age of forty, that the state expected them

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<v Speaker 2>to go back to school. Now we all understand that

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<v Speaker 2>that could be impossible for a variety of reasons. We're

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<v Speaker 2>talking nine months of schooling in a licensed cosmetology school.

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<v Speaker 2>They're almost always private businesses. At a minimum for some

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<v Speaker 2>people it takes two years, depending on what license they're

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<v Speaker 2>trying to get. You've got to pay that private business

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<v Speaker 2>quite a bit of money, you know. It usually ranges

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<v Speaker 2>from like seven thousand dollars to fifteen thousand dollars. You

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<v Speaker 2>can't work while you're going to this school because again

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<v Speaker 2>you've got to be there full time. You probably will, however,

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<v Speaker 2>work for the private cosmetology school which has people come

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<v Speaker 2>in and pay for cosmotology services, but they keep the money.

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<v Speaker 2>At the end of all of that, you have to

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<v Speaker 2>take a couple of exams. There's almost always a practical

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<v Speaker 2>component where you have to show that you know how

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<v Speaker 2>to do the basic techniques, and there's almost always a

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<v Speaker 2>written component, like a test you would take in school

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<v Speaker 2>about how bacteria grow, where different styles originated from what

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<v Speaker 2>people mean when they say things like a beehive or cornrows.

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<v Speaker 2>So this is an example of what we call occupational licensing.

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<v Speaker 2>It's the requirement that before you can do something to

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<v Speaker 2>pursue a living. Even though we all consider that thing

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<v Speaker 2>to be legal, you need the government's permission. Now, there

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<v Speaker 2>are a lot of professions that automatically come to mind

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<v Speaker 2>when we think about occupational licensing. Doctors, lawyers, engineers, and

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<v Speaker 2>indeed the licensing of those professionals has been around for

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<v Speaker 2>a long time. But in the nineteen fifties in this country,

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<v Speaker 2>it was about five percent of the American workforce that

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<v Speaker 2>required some form of occupational licensing. Today it's much closer

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<v Speaker 2>to twenty percent, and that has profound social and economic impacts,

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<v Speaker 2>particularly for people who are on the margins of society

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<v Speaker 2>and on the margins of where it makes sense to

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<v Speaker 2>begin licensing people for things. Cosmatology is a good example

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<v Speaker 2>of this, because it's often the first wrong of the

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<v Speaker 2>entrepreneurship ladder, especially for people from other countries who don't

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<v Speaker 2>have a lot of language skills and a lot of

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<v Speaker 2>other opportunities. Right. This is perhaps why you see recent

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<v Speaker 2>Asian immigrants predominating in places like nail salons, or why

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<v Speaker 2>you see recent African immigrants predominating in places like hair

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<v Speaker 2>braiding salons. It's because they have a marketable skill that

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<v Speaker 2>people will pay for. It's just they've really only got

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<v Speaker 2>one and cosmetology licensing in the twenties might have been

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<v Speaker 2>about basic sanitation, but as time has gone on, it's

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<v Speaker 2>become more about incumbent control of the industry. I mean

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<v Speaker 2>there's in every state there's a committee who has jurisdiction

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<v Speaker 2>over an executive agency whose responsibility it is to regulate

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<v Speaker 2>the cosmetology industry. Usually by law, that agency has to

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<v Speaker 2>be run by cosmetologists, you know, everyone that's on the

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<v Speaker 2>board of the Texas Department of Licensing and Regulation. There's

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<v Speaker 2>supposed to be at least some people who are cosmatologists

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<v Speaker 2>and some people who represent other walks of life. And

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<v Speaker 2>so that agency will go to the relevant lawmaking committee

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<v Speaker 2>and say, we think there need to be more restrictions on,

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<v Speaker 2>for example, this new practice of threading that we're only

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<v Speaker 2>beginning to see in our state. And the people who

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<v Speaker 2>will be in the audience to sort of provide public

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<v Speaker 2>comment will be you know, beauty school owners and other cosmetologists.

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<v Speaker 2>And that means that the people who control the policy

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<v Speaker 2>outcomes are the people who stand to gain or lose

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<v Speaker 2>the most. And I mean the motivation is obvious. You

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<v Speaker 2>want to keep new competition out of the market so

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<v Speaker 2>that you can charge. More so, their basic question that

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<v Speaker 2>night was can you help us? And you know, I

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<v Speaker 2>sort of gleefully said we might be able to because

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<v Speaker 2>I had been studying up on the Texas Constitution and

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<v Speaker 2>was familiar with a line of cases on the one

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<v Speaker 2>hand that provided very robust constitutional protection against irrational regulations

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<v Speaker 2>like this, And on the other hand, I was aware

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<v Speaker 2>of another line of cases that hewed much more closely

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<v Speaker 2>to the federal constitutional standard for economic regulations, namely, the

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<v Speaker 2>rational basis test is there any conceivable justification? And if

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<v Speaker 2>there is, the economic regulation is constitutional. So I was

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<v Speaker 2>aware of the tension between these two lines of cases,

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<v Speaker 2>and I wanted a case involving an economic regulation that

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<v Speaker 2>would allow us to tease them out. And I immediately

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<v Speaker 2>saw the potential in ashen anvers predicament.

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<v Speaker 1>And when we come back more with our American Stories

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<v Speaker 1>and with Wesley Huttit and he's an attorney with the

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<v Speaker 1>Institute for Justice defending Ash Patel who runs an eyebrow

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<v Speaker 1>threading business in Texas, And we're back with our American

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<v Speaker 1>Stories and our Rule of Law series, and the story

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<v Speaker 1>of the Ash Patel case as told by his attorney

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<v Speaker 1>Institute for Justice lawyer Wesley Huttitt. When we last left off,

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<v Speaker 1>Ash Patel, a man who employed eyebrow threaders, had been

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<v Speaker 1>told he'd have to shut down his operation and send

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<v Speaker 1>all of his threaders back to Cosmic Potology school for

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<v Speaker 1>anywhere between nine months and two years of courses that

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<v Speaker 1>didn't have anything to do with their craft. It seemed burdensome,

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<v Speaker 1>and there was a disconnect between Texas's laws and the

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<v Speaker 1>federal laws on economic freedom. So Wesley thought he might

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<v Speaker 1>have a case. Let's continue with the story.

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<v Speaker 2>There was an uncertainty in Texas law. There was one

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<v Speaker 2>line of cases that seemed to say, we do something

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<v Speaker 2>more than what the federal government does when a person

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<v Speaker 2>complains about a regulation that's making it too difficult or

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<v Speaker 2>impossible to support themselves. And one line said that the

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<v Speaker 2>government needed to have robust reasons that lined up with

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<v Speaker 2>the real world. In other words, under Texas's culture and

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<v Speaker 2>traditions and laws, the government had to have a good

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<v Speaker 2>reason for requiring a restriction on someone's economic rights, and

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<v Speaker 2>that reason had to make sense in the real world.

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<v Speaker 2>I'll give you an example. There was a case from

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<v Speaker 2>the sixties where a small Texas town had restricted the

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<v Speaker 2>size of fuel tanker trucks that could come through the town.

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<v Speaker 2>Their justification for that was that they were concerned about fires.

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<v Speaker 2>What that required, in practical terms, was that the large

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<v Speaker 2>tanker trucks that operate everywhere else had to stop outside

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<v Speaker 2>of the town and transfer into two smaller tanker trucks,

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<v Speaker 2>which the court recognized, based on testimony at a trial,

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<v Speaker 2>was a huge risk of fire and having two trucks

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<v Speaker 2>on the road that could go boom was worse than

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<v Speaker 2>having one truck on a road that could go boom.

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<v Speaker 2>So the court, in that case, it's called Humble Oil,

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<v Speaker 2>ruled that under the Texas Constitution, the law was unconstitutional.

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<v Speaker 2>You couldn't require that sort of irrational justification. Now, under

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<v Speaker 2>federal law, the story has been quite different since around

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<v Speaker 2>the New Deal period. Under federal law, we currently have

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<v Speaker 2>an understanding of the US Constitution's protections for economic liberty

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<v Speaker 2>as being very anemic, almost worthless. The Federal Constitution, the

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<v Speaker 2>Supreme Court has told us, requires only some conceivable justification

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<v Speaker 2>for a law, and so I think if we compare

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<v Speaker 2>that to the Humble Oil case, the government's going to

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<v Speaker 2>get a lot of leeway in determining the size of

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<v Speaker 2>fuel tanker trucks because fuel tanker trucks go boom, and indeed,

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<v Speaker 2>the federal case law bears out that kind of government

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<v Speaker 2>may do anything reasoning. So that is why when Ash

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<v Speaker 2>and an er into my office and describe their problem

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<v Speaker 2>and said can you help, that is why I was

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<v Speaker 2>so confident that there was a there there, Because state

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<v Speaker 2>supreme courts exist to resolve those kinds of conflicts within

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<v Speaker 2>their own case law. You know, lower courts are supposed

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<v Speaker 2>to know what the law is before they can apply

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<v Speaker 2>it correctly. And if, as in Texas, you know, you

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<v Speaker 2>have these two lines of cases, some of them hewing

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<v Speaker 2>to federal constitutional standards and some of them hewing to

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<v Speaker 2>the more robust Texas standards, then there's confusion that can

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<v Speaker 2>lead to inconsistent results depending on you know, who your

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<v Speaker 2>judge ends up being and where you end up filing

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<v Speaker 2>your case. The whole point of bringing this case was

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<v Speaker 2>to establish that under the Texas Constitution, there has to

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<v Speaker 2>be a real and substantial connection between what the government

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<v Speaker 2>is trying to do and how the regulation works in

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<v Speaker 2>the real world. And even if that connection exists, courts

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<v Speaker 2>still ask is the regulation unduly burdensome in light of

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<v Speaker 2>what the state is trying to achieve, it seems maybe

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<v Speaker 2>like there could be a real and substantial connection to

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<v Speaker 2>health and safety. If you go to cosmetology school, you

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<v Speaker 2>do admittedly learn things like washing your hands. But what

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<v Speaker 2>Texas was requiring was seven hundred and fifty hours of instruction.

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<v Speaker 2>That's about nine months of a full time job. Two tests,

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<v Speaker 2>neither of which had any material about eyebrow threading specifically,

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<v Speaker 2>or about sanitation specific to eyebrow threading, And so our

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<v Speaker 2>argument all along was it takes about an hour to

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<v Speaker 2>learn the sanitation that you need to learn to be

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<v Speaker 2>a safe threader. You need to wash your hands, use

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<v Speaker 2>new thread with every customer, and keep the work area clean.

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<v Speaker 2>So it's just inconceivable that that could take seven hundred

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<v Speaker 2>and fifty hours to learn. We never disputed that there

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<v Speaker 2>could be a license for threading. It was just that

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<v Speaker 2>this license, the seven hundred and fifty hour two examination

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<v Speaker 2>requirement that didn't involve any instruction in threading, was obviously unconstitutional. So,

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<v Speaker 2>like so much of public interest law, this case started

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<v Speaker 2>out with a loss the state one. We appealed and

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<v Speaker 2>we lost the state one. In the Intermediate Court of Appeals,

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<v Speaker 2>and then we had to ask the Texas Supreme Court

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<v Speaker 2>for what lawyers called discretionary review, and they agreed to

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<v Speaker 2>take the case. We won in the Texas Supreme Court

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<v Speaker 2>by a vote of six to three. Now, five of

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<v Speaker 2>those justices agreed with our argument that the state constitution

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<v Speaker 2>requires a real and substantial relationship between a regulation and

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<v Speaker 2>how it functions in the real world, and also can't

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<v Speaker 2>be unduly burdensome. They struck the law down based on

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<v Speaker 2>that Texas test. One justice agreed that this law was unconstitutional,

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<v Speaker 2>but didn't think that there needed to be an independent

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<v Speaker 2>Texas test to make that ruling. He thought the law

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<v Speaker 2>violated the federal rational basis test because it was just

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<v Speaker 2>so inconceivably justified. But you know, there were three dissenters

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<v Speaker 2>who were very vocal about the fact that they did

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<v Speaker 2>not want to be reviewing economic regulations, did not takes

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<v Speaker 2>seriously Texas being different from the federal government in terms

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<v Speaker 2>of its protections for economic liberty, and thought that it

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<v Speaker 2>was perfectly fine that threaders were being required to spend

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<v Speaker 2>nine months in a private beauty school learning nothing about

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<v Speaker 2>their own jobs. Now, this was a huge landmark victory

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<v Speaker 2>for IJ It was obviously life changing for the clients

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<v Speaker 2>in the case. It's an incredible feeling to have the

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<v Speaker 2>patience to wait years from you know, we launched this

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<v Speaker 2>case in two thousand and nine and we got a

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<v Speaker 2>decision from the Texas Supreme Court in twenty fifteen, so

0:17:51.560 --> 0:17:54.000
<v Speaker 2>it's about five and a half years from beginning to end,

0:17:54.720 --> 0:17:58.000
<v Speaker 2>and it was mostly losing. So you know, it's an

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<v Speaker 2>incredible feeling to have that victory call with your client.

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<v Speaker 2>But there's so much more work that needs to be done.

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<v Speaker 2>I mean, this is one case in a sea of

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<v Speaker 2>burdensome economic regulations that really require court intervention, and it's

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<v Speaker 2>very difficult to get, you know, at least judges of

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<v Speaker 2>the current generation to unlearn what they were taught in

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<v Speaker 2>law school that there's no economic regulation that a court

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<v Speaker 2>can strike down. You know, what is needed here is

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<v Speaker 2>like what is needed in so many other aspects of

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<v Speaker 2>American life today. Nuance. Of course, it's true that the

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<v Speaker 2>political branches have the right to decide who should get

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<v Speaker 2>to practice what occupations, but it is also true that

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<v Speaker 2>we should not allow them to do that at the

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<v Speaker 2>behest of the regulated industry and only for their benefit.

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<v Speaker 2>In the American constitutional order, courts are there to ensure

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<v Speaker 2>that individual's rights are being honored in the lawmaking process right,

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<v Speaker 2>and it's absolutely essential that there be more cases like Patel,

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<v Speaker 2>where particularly state courts, but ultimately federal courts as well,

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<v Speaker 2>takes seriously the time honored individual right to use your

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<v Speaker 2>own labor, your own hands, to support yourself, free of

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<v Speaker 2>any restrictions that aren't justified by a need that the

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<v Speaker 2>public has, not a need that a particular lobbyists or

0:19:51.359 --> 0:19:52.680
<v Speaker 2>lobby might have.

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<v Speaker 1>And a special thanks to Monty Montgomery for his great

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<v Speaker 1>work on a piece, and a special thanks to Wesley

0:19:59.760 --> 0:20:02.879
<v Speaker 1>high But at the Institute for Justice attorney who you

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<v Speaker 1>heard tell this remarkable story, this important story, another rule

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<v Speaker 1>of law story in a part of our rule of

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<v Speaker 1>Law series here on our American Story