Talking to Lydia DePillis, Nicholas Majett, new head of DC’s Department of Consumer and Regulatory Affairs (and since 2006 its deputy director for inspections and compliance) says it’s not necessarily clear:
Well, I see myself as a communicator. I'm still an attorney. And as a litigator, I've had to argue before judges and juries. And as deputy director for community service, I would attend hundreds of community meetings, a lot of which were on behalf of Director Argo. I think it's just in how you approach people. What I found is that people just don't know. And because the agency's so complicated, you can't just go to one person and get an answer. In most cases, I know the answer. But you can't walk into DCRA and say "?I want to start a business, what do I do?’ In fact, a lot of the time, you have to go to an attorney. So a lot of people get frustrated, thinking they're going to come down here and one person's going to be able to answer all of their questions.
Sometimes I get yelled at, but that didn't bother me, it's part of my job. I'm a civil servant. Some people don't use that term anymore, but it used to be that what be called them. I work for the people. I have to treat them with respect, no matter what, and I have to try to calm them down.
As a recovering rage addict, I don’t approve of yelling at people, and certainly you shouldn’t yell at DCRA employees over things that are out of their control. But as a policy matter, it strikes me that you should, in fact, be able to walk into DCRA and say “I want to start a business, what do I do?” If the agency is “so complicated” that answering the question is beyond human comprehension, then perhaps it should be simplified. But if the issue is really that “you have to go to an attorney” then it sounds like it is, in fact, possible to get the rules explained by adequately trained personnel.
Whichever the case may be (or, as I suspect, a combination of the two), it seems to me that it would be in the city’s interest to make it possible for a would-be entrepreneur to walk into DCRA’s office and get an answer to the question. A city’s going to need some business regulation, but a city’s also going to need some people to start businesses. If there’s no way to do this without consulting a lawyer first, that’s convenient for local lawyers. It’s also convenient for big companies who can easily afford lawyers, and it’s also convenient for smaller-time but already-established players who can benefit from insider knowledge and who appreciate the protection from competition. But it’s not good for workers who might appreciate more employment opportunities, it’s not good for consumers who might like more options and it’s not good for the city’s tax base.
This is one step up from complaining about the length of the health care bill. Who knew you would need a lawyer to create a legal entity?
This is one step up from complaining about the length of the health care bill. Who knew you would need a lawyer to create a legal entity?
Oh, don’t be so silly, Yglesias. Poverty inducement is one of the principle purposes of “progressive” government. And it slows down global warming!
Oh, don’t be so silly, Yglesias. Poverty inducement is one of the principle purposes of “progressive” government. And it slows down global warming!
Who knew you would need a lawyer to create a legal entity?
At the level of Frozen Banana Stand a lawyer shouldn’t be required.
Who knew you would need a lawyer to create a legal entity?
At the level of Frozen Banana Stand a lawyer shouldn’t be required.
A “business” isn’t a legal entity. You’re probably thinking of a corporation, which is only one kind of business (and often not the type most suited for a one-person start-up).
A “business” isn’t a legal entity. You’re probably thinking of a corporation, which is only one kind of business (and often not the type most suited for a one-person start-up).
Red tape: it trips you on the way in and gives you a push on the way out.
“a recovering rage addict”
Really? Not that it’s anyone’s business, but the blog doesn’t strike me as the work of someone prone to rage.
Matt,
before just commenting on the requirements, perhaps look into why these were created in the first place. Not saying that a review is not ever necessary, but rules and regulations are not just made up without cause. In most cases, rules and regulations are established due to previous incidents of either corruption, illegal activity, dangerous activity and/or issues relating to the potential business owner which requires certain amounts of red tape to help reduce this.
In addition, based on this post, most of the jobs being created by any entity so simple as to not need much in the way of set-up is not going to pay wages worth a damn. But as you said earlier "“ let's hope in the future we can somehow tax the wealthy to take care of this.
I think a central theme of this blog is that many regulations actually *aren’t* created with some overarching social planner view in mind. A lot are created as a quick way to attempt to maintain quality in a sector (like the naming of approved NRSRAs like Moodies, S&P, and so forth). Some are created to protect incumbent businesses from competition. Some are created because 100 years ago religious figures dictated some odd (in retrospect) rules on alcohol consumption. The list goes on. We shouldn’t assume that complex rules for simple cases are always evil. Life is nothing if not good at producing edges cases and regulation needs to handle edge cases. But asking why things can’t be simpler is important.
I think one of the big differences between cities that have succesfully negotiated the last 5 or so decades is the enthusiasm of “development corporations” (different terms in different places) which are more or less supported by the local government to lure and promote business within their borders.
Case in point is Amherst, NY, a suburb of Buffalo, which has made Amherst a consistently growing and safe place to live while Buffalo has gone down the toilet in many ways (I am a fan of living Buffalo and not of the same in Amherst, but one has to understand the reality of how they are viewed).
I’m sure that similar points could be made about Dallas, Phoenix, etc. They really do have effectively governmental organizations that make doing business easier. It’s not a market solution in the slightest – it’s actual government intervention promoting business. And it works.
Yeah, more explication, please.
Yeah, and just to briefly expand on this; this post is an example I think of one of the more compelling themes of this blog: The idea that liberals – as people who believe that a certain degree of govt intervention in an otherwise market-based economy – have a deep interest in good governance and making sure those interventions are effective. When they aren’t, let’s change them!
Yeah, and just to briefly expand on this; this post is an example I think of one of the more compelling themes of this blog: The idea that liberals – as people who believe that a certain degree of govt intervention in an otherwise market-based economy – have a deep interest in good governance and making sure those interventions are effective. When they aren’t, let’s change them!
Not very nice to draw that ‘stache on that dude.
(1) I think you’re missing the point. Assuming (!) that the regulations were created with good intentions and make sense, it is still crazy that the government can’t tell people how to do something as fundamental as opening a business. (Some people don’t think that being able to open a business is an important right; they are wrong.)
(2) It looks a lot like you are assuming that business licensing and operating regulations must have been created with good intentions and make sense simply because they are government regulations. If that is your position, that would be, I believe, hopelessly naive.
It’s just another reason not to live in DC.
I recently inquired about starting a business in DC. Online and in person was a step by step description of each form and requirement necessary to start a business – what agency to go to and how much the fees would be.
Following the instructions it took me two visits and about 4 hours to get licensed and legally authorized to open a business – not the most efficient, but reasonable enough.
So I’m quite surprised that a public servant doesn’t know how to tell people how to start a business. Maybe he should read his own literature.
Holy cow, I have been going through this myself…. Between DCRA’s paperwork slowdowns and DC’s antiquated zoning requirements, it has been surprisingly difficult and time-consuming to start a business here. I’m starting to see why a lot of people go incorporate across the river in Virginia (though, to be honest, I don’t know for sure that it would be any easier over there, it’s just my hunch).
I’m pretty sure this is partly a result of overcomplication/regulation, but mostly a result of risk-avoidance. If the DCRA employee tells you to do A, B, C, & D, but fails to mention E (because E only applies to certain businesses, and she didn’t realize you were in that category), then it’s on her, and the DCRA. Law firms exist precisely to handle this sort of risk – they charge a lot of money, they carry lots of insurance, and they are very, very thorough for their paying clients.
And to be clear, this is in no way bureaucracy-specific. Doctors order extra tests, businesses discuss things by phone to avoid paper trails, architects draw the attention of the foreman to a dangerous situation but wouldn’t tell a laborer to get away from the rickety scaffolding, etc. Most of modern American life is about risk avoidance.
GOOOOOOOOOOOOOOOOOOOLLLLLLLLLDDDD
Yeah, shooter, you tell ‘em.
As a recovering rage addict, I don't approve of yelling at people,
“I’m a Ragaholic!” *sob* “I just can’t get enough Ragahol!”
Sorry, I couldn’t resist.
Anthony, from you we can always expect more Loughner-esque incoherence coupled with purple faced rage.
And you never disappoint.
GOOOOOOOOOOOOOOOOLLLLLLLLLLLLDDDDDDDDD
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