New regulations will allow vegan and vegetarian food companies to continue using meat or meat product terms on their labels. 

In July, the Institute for Justice and Mississippi Justice Institute partnered to bring a First Amendment lawsuit against the State of Mississippi concerning proposed regulations that would have banned plant-based foods from using meat product terms like “burger,” “bacon,” and “hot dog” on their packaging. The new regulations are the result of the lawsuit.

“These new proposed regulations are a victory for free speech in Mississippi,” said Aaron Rice, Director of the Mississippi Justice Institute. “It shouldn’t be a crime for plant-based food companies to describe their products in a way that everyone understands.  We are happy that our state officials listened to the concerns brought forward by our clients in this lawsuit, and took the right approach. Because of these changes in the regulations, our clients will be able to continue selling vegan and vegetarian products in Mississippi.”

Under the new regulations, plant-based foods will not be considered to be labeled as a “meat” or “meat food product” if the label also includes “meat-free,” “meatless,” “plant-based,” “vegetarian,” “vegan,” or similar terms. 

The proposal will be open for public comment for 25 days. 

The proposed regulations can be found here. 

The Mississippi Supreme Court upheld the constitutionality of public charter school funding, preserving the schools that have served as a lifeline to hundreds of Mississippi children in just a few short years. 

“This ruling is a major victory for parents who simply want what every parent wants: the ability to choose the best possible education for their children,” said Aaron Rice, Director of the Mississippi Justice Institute. “We are happy for our clients and for every parent and student in Mississippi who will continue to have increased educational choices because of this ruling.”

The Southern Poverty Law Center filed a lawsuit in 2016 which could have shut down charter schools. The Mississippi Justice Institute intervened and represented three parents whose children attend charter schools.

The Court ruled that Mississippi’s Charter School Act of 2013 is constitutional. The Southern Poverty Law Center had argued that part of the Act’s funding mechanism was unconstitutional. That provision requires public schools to share the tax revenues collected for education with charter schools in their district, based on the number of students who attend those charter schools. The Court held that this funding mechanism was constitutional, because charter schools are public schools and are associated with the school district in which they are located.  

“The parents are pleased that the Supreme Court has confirmed the authority of the legislature to provide different options to meet the educational needs of all Mississippi children,” said Mike Wallace, a Shareholder with Wise Carter who provided pro-bono counsel for charter school parents. “Mississippians should now continue to work with the legislature to develop new and creative programs so that parents can choose those that best serve their children.”

“I’m very excited about this decision,” Tiffany Minor, the mother of a student at Smilow Prep said.” It gives my daughter and other children the opportunity to choose what type of education they would like at what school they choose to go to. So I’m very excited. This was the best decision ever. I love it.”

In just a couple years, Tiffany has seen the change this new option provided for her daughter, Jalonda. 

“When my daughter did a test during her first year at Smilow Prep as she was entering fifth grade, she was on a third grade reading level,” Tiffany said. “By the time she ended that school year and was getting ready to go to sixth grade she was on the actual six grade reading level. So she transformed three reading levels in one year from Smilow Prep. It’s helping her and she’s having fun while she’s making honor roll so I love it. It’s amazing to me.”

“Smilow Prep has helped me a lot since I’ve been in it and it actually makes me a better learner,” Jalonda said. “They give me extra help when I need it.”

Charter schools are public schools that are given freedom from some of the regulations placed on traditional public schools. They currently operate in over 40 states and the District of Columbia. If the Southern Poverty Law Center’s suit was successful at the Mississippi Supreme Court, Mississippi would be one of a small handful of states to not offer these innovate schools for children.

Ella Mae James has two children at Reimagine Prep, Laporcha and Jonathon.

“My children have been attending Reimagine Prep from when the school first opened,” Ella said. “And they have grown so much in their reading and math levels. They did it with the tutoring and the extra help they receive. And we just appreciate having this opportunity to give them that choice.”

The full ruling can be found here.

The city of Jackson’s population has declined by some 40,000 residents over the past four decades. And one of the prime reasons is the district education in the capital city. School choice could change that.  

Routinely rated as poor or failing, most recently receiving an F-rating from the state, there are few options for a quality education from the Jackson Public School district.

JPS, which is losing students at a faster rate than the city, currently spends more than $11,000 per student, about $1,000 above the statewide average.

JPS has seen a decrease from 30,000 students in 2012 to under 24,000 last year, a drop of 20 percent. Yet the city’s population only dropped about 5 percent during that same time. That is partially because families now have free alternatives. 

In the past four years, a small charter market has emerged with about 1,500 students enrolled in charter schools in Jackson. Compared to the larger JPS system, the charter market is still tiny. There is not a high school and kindergarten and first grade have just recently become options. But in the grades that have had charters for a few years – mainly fifth and sixth grade – we see 15-20 percent of public school students migrating to charters. 

These are parents who never previously had an option now having an option. 

Jackson also has a large private school sector, with a number of high-quality schools competing for students from Jackson and the surrounding counties. But these schools price out many who would love the opportunity to attend. 

Along with a charter authorizing board that welcomes more schools to the city, allowing tax dollars to flow to parents for their child’s education would help eliminate one of the reasons families leave Jackson. That same family would no longer, in their mind, have to leave because of a failing school system. The “either-or” dilemma is no longer an issue.

A great example on how this could work is in Washington, D.C. By the late 1990s, the city’s population hit a 60-year low as families headed to Virginian and Maryland in large numbers. And new potential residents never considered the city. But over the past two decades, the city’s population has grown by more than 100,000.

Yes the city is now safer and more appealing, but today parents in D.C. have more options than ever, including a charter sector that serves over half of the city’s students, magnet schools, a federally funded voucher program, and districtwide open enrollment. Less than on-in-four students attend their assigned district school. 

The potential is there. Because even if you revitalize the city and make it a place where young professionals want to live, you’ll still see an exodus when their children turn five. 

This week, Mississippi Center for Public Policy will be looking into the underlying reasons as to why Jackson is struggling, exploring the legislative and regulatory climate which encourages migration and business stagnation both within our capital city, and across the state.

Over $1.5 billion have left the city of Jackson and Hinds county between 1992 and 2016, mostly for Madison and Rankin counties. 

That is according to IRS tax migration data. As the old saying goes, “money talks”, and this mass movement of money leaving Jackson is a serious testament to the need for changes in the state’s core urban center.

Between September 2015 and 2016 alone, Jackson lost more than $5 million (almost ten percent) of its tax revenue. City leaders have taken to hiking taxes in order to offset the tax revenue lost from the movement of its citizens to the suburbs, yet in so doing it has made life all the more expensive for those who have stayed, further incentivizing the suburban exodus of others and exacerbating the existing problem.

Madison and Rankin counties showed large growth over the same time period, altogether expanding their wealth indices by about a combined $1.5 billion.

Around the state, Desoto county also showed a positive rate of growth, gaining over $1.34 billion almost entirely from Shelby county, Tennessee. However, this growth in some counties was offset by losses throughout the state, resulting in a net negative for Mississippi. Every county within the Delta lost wealth. Altogether well over $1 billion left the area.

While some counties have continued to grow, overall the state has lost over $100 million. This has made Mississippi the only state in the Southeast besides Louisiana to see a net wealth lost.

A similar trend accompanies with population loss, as Mississippi and Louisiana were the only states in the Southeast between 2017 and 2018 to experience declines in population.

In total, for the time period, the state gained wealth from Louisiana, Tennessee, Illinois, California, and Michigan, while it lost wealth to Texas, Florida, Alabama, Georgia, and North Carolina.

Two major questions arise from this data, first, what is motivating internal migration? It is clear that citizens are voting with their feet, and are showing their preference for the better fiscal management of Madison and Rankin county, among other reasons.

This movement of cash has created serious shortfalls in Jackson’s tax revenue, and rather than continue to place greater financial burdens on those who remain, the city needs to tighten the proverbial fiscal belt.

The second question is why Mississippi is seeing a net loss overall, and especially why neighboring states, including Tennessee, Arkansas, and Alabama have become more attractive options for those seeking to move into the Southeast. Mississippi ought to answer the first question before the second. There are clear reasons motivating large numbers of people to choose Desoto, Madison, and Rankin counties. These areas should be used as a model for statewide growth and policy change.

This week, Mississippi Center for Public Policy will be looking into the underlying reasons as to why Jackson is struggling, exploring the legislative and regulatory climate which encourages migration and business stagnation both within our capital city, and across the state.

Payrolls in Mississippi grew in July, continuing a positive trend for the state over the past year. 

The total number of employees on nonfarm payrolls in the state increased to 1,171,700 according to the Bureau of Labor Statistics. That’s an increase of about 1,200 jobs over the past month. These numbers are particularly impressive after the rough start to 2019, with job losses in each of the first three months. 

But that has changed.

Over the past year, the state has added 19,000 jobs. That translates to a 1.7 percent growth during that time period, which is higher than the national average. 

During the previous 12 months, each sector of the economy, as classified by BLS, added jobs in Mississippi. 

Among neighboring states, Alabama has had the highest growth rate, at 2 percent. Tennessee was also ahead of Mississippi at 1.8 percent. Arkansas’s growth rate was 1 percent, while Louisiana’s decreased by 0.05 percent. The Pelican State was the only state in the country to post a loss over the past year. 

But compared to national numbers, Mississippi was ahead of the average, which came in at 1.4 percent. Overall, Mississippi’s growth rate placed the state 17th nationally. 

Job growth among the SEC footprint.

The Business Roundtable, an association that counts among its members the CEOs of some of the largest public companies in America, announced this week a fundamental change in its new definition of the purpose of a corporation. 

Mainstream media genuflected. Milton Friedman rolled over in his grave.  

The Nobel prize-winning economist and best-selling author helped to create the predominant view that the purpose of a corporation, particularly a large, publicly traded one, is to increase its profits. To quote Friedman, “There is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.”

In fact, the overriding tenet of Corporate Finance, present in every college textbook, states that the role of the finance manager is to increase shareholder value.

Not according to this enlightened group. By their progressive definition, a corporation is not to independently pursue profit, but rather, pursue profit congruous with social good. 

It’s as if the pursuit of profit is somehow immoral and the aim of increasing shareholder value doesn’t require the care of customers, employees, and suppliers and our free market system hasn’t produced more prosperity for more people than any other economic system in the history of humankind.

So who decides the definition of social responsibility? What metrics determine if C Suite execs have achieved annual goals? Profits be damned, we reduced our carbon footprint by 2%, we saved four polar bears, we made the world a better place for our kids by .0002% last year. 

We can only imagine the squishy, subjective claims of success these modern CEOs will announce.

In his monumental essay in the New York Times on September 13, 1970, Friedman said, “The discussions of the ‘social responsibilities of business’ are notable for their analytical looseness and lack of rigor.”

There is also the distinct possibility that the CEOs who endorsed this modern, corporate “manifesto,” which includes 181 of the 188 members of the Business Roundtable, were trying to appease the current wave of the progressive political voices. 

Or a less cynical view might be that it was an attempt to seek relief or approval from the activist investors who constantly agitate public companies through shareholder meeting protests and the like. Both groups have grown more and more hostile to capitalism. If the latter is true, corporate groupthink is worse than we thought. You know what they say, if you give a mouse a cookie, he’ll soon want a glass of milk.

We have seen this experiment into corporate social activism, let’s just call it what it is, with devastating effects to corporate reputation and shareholder value. Starbucks under Schultz, Target Corp., Dick’s Sporting Goods, IBM, Disney’s ESPN, Kellogg’s, etc. The results have been a punishing lesson about mixing non-corporate ideas with P&L statements almost immediately remedied upon backtracking their social initiatives.

In his essay, Freidman’s words were prescient, “This short-sightedness is exemplified in speeches by businessmen on social responsibility. This may gain them kudos in the short run. But it helps to strengthen the already too prevalent view that the pursuit of profits is wicked and immoral and must be curbed and controlled by external forces. Once this view is adopted, the external forces that curb the market will not be the social consciences, however highly developed, of the pontificating executives; it will be the iron fist of government bureaucrats.”

Abandoning a 50-year-old view on the purpose of a corporation also undermines the belief in markets themselves. On this issue, Professor Friedman offered this dire warning, “the doctrine of ‘social responsibility’ involves the acceptance of the socialist view that political mechanisms, not market mechanisms, are the appropriate way to determine the allocation of scare resources to alternative uses.” 

A simple review of the 20th century should convince us all that’s not a road we want to travel.

Thankfully, a handful of leaders have rebuked the Business Roundtable. The Council of Institutional Investors was one such leader. “There’s no mechanism of accountability to anyone else,” said Ken Bertsch, the council’s leader. “This is CEOs who like to be in control and don’t like to be subject to the market demands.” 

In the Wall Street Journal, Michael Bordo, a Rutgers University economics professor and former student of Mr. Friedman, said the Business Roundtable’s new stance would have corporate executives behave like regulators. “That’s not what business is; that’s what government is,” he said. “I still think Friedman was right.”

However, there is one voice conspicuously absent in the dissent. Where are the independent board members? After all, the CEOs are employees who work at the direction of directors and shareholders. 

The resources these CEOs propose to spend in the pursuit of social good is not their own. Those resources are capital invested by shareholders; not by the growing category of “stakeholders” these modern CEOs seem so intent on pleasing. 

It is the fiduciary responsibility of the directors to protect such assets…and maybe even the entire free market system, too.

This column appeared in FEE on August 26, 2019.

Mississippi occupational licensing burden places it in the top half among the 50 states and the District of Columbia.

According to the non-profit Institute for Justice, Mississippi’s overall burden was ranked 19th overall. California had the highest burden, while Wyoming had the lowest. 

The overall burden combines the number of low-and-middle income occupations, along with other factors including average fees, average calendar days lost, average exams, average minimum grade, and average minimum age. 

IJ reviewed 102 occupations, and Mississippi licenses 66, or about 65 percent of all low-and-middle income occupations. Only 14 states license more occupations. Louisiana and Washington both license 77 occupations, the most, while Wyoming licenses just 26. 

Mississippi does well, however, in the burden required to obtain a license coming in at just 46th. The average fees in Mississippi total $330, while the average days lost is 160. 

Today, approximately 19 percent of Mississippians need a license to work compared to just 5 percent in the 1950s. The net result is that Mississippi has lost 13,000 jobs because of occupational licensing and the state has suffered an economic value loss of $37 million. 

To put that into perspective, just by legislative action to rollback unnecessary licenses, we can create two Nissan plants…without spending a dime of taxpayer dollars.

Instead of relying on government, these are actions that will encourage and promote economic growth in Mississippi. If that is our goal, we need to trust in the benefits of the free market and a “lighter touch” from government and occupational licensing regimes and we need to return to a belief in individual responsibility.

Calls for expanding occupational licensure usually do not come from concerned citizens, but from industry insiders more interested in limiting the number of people who can work in their occupation. 

In 2018, the Mississippi legislature, with little discussion and few dissenting votes, passed a bill to make it more difficult to become a real estate broker. The proposed law sought to increase the time it would take to become a broker, going from the current one year to three years. 

Fortunately, Gov. Phil Bryant vetoed the legislation and it didn’t come back this past year. 

Who were the individuals supporting such legislation? It wasn’t a group of citizens negatively impacted by brokers who had just one year of experience. No, it was, naturally, the Realtors Association. And I am sure they would say they are doing it to protect you and me.  

More recently, the Mississippi Justice Institute filed a lawsuit against the Board of Cosmetology over requirements that eyebrow threaders receive 600 hours of instruction that don’t have anything to do with the practice of threading. 

When WLBT talked with a threader who completed the 600 hours of instruction, her response was that it’s not fair because she had to complete the classes for a license. Relevant or not. 

That’s certainly an understandable position. But the goal shouldn’t be to make the entrance harder for new entrants, but easier for everyone. 

That’s the case whether we are talking about the 66 low-to-middle income occupational licenses in the state or the 117,000 or so regulations in the state’s administrative code. 

A smart policy would start with only choosing licensure when there is empirical proof that it is necessary and there is not a less restrictive approach. 

As for the current licensing schemes, the legislature should begin by repealing unnecessary licenses. And occupational boards should not be in charge of deciding whether a license is necessary. 

Every year, bills to extend the repealer of various occupational boards come before the legislature. They always pass. Usually with no discussion and few dissenting votes. Instead of simply relying on what that board wants, the legislature should use that time to study if a license truly relates to health and safety. 

A great place to review each license would be the Occupational Licensure Review Board, which only has authority over new licenses or regulations. Empower the board to take a hard look at every license, it's need, and how it impacts the economy, for both entrepreneurs and consumers.

If we haven’t determined if a license actually protects us, rather than ceding that power to industry incumbents, we should opt for less red tape and more freedom.

And give more Mississippians the ability to earn a living, even if they don’t have government permission. 

If you haven’t seen an eyebrow threading salon yet, you will soon. The brow-shaping trend is sweeping the nation, and devotees of the practice swear by the technique for its precision, convenience, and affordability compared to waxing and tweezing. 

The threading craze is also inadvertently accomplishing something besides perfecting American arches: it’s exposing the shameless rent-seeking that litters the occupational licensing landscape across the country.  

Dipa Bhattarai is a graduate student in Mississippi.  She was born in Nepal, and has been threading most of her life. Eyebrow threading is a very safe method of hair removal that does not reuse the same tools on different customers and does not involve the use of sharp implements, harsh chemicals, or heat. Instead, this simple technique allows threading artists to use nothing but twisted cotton thread, acting like a mini-lasso, to remove stray hair. 

Dipa saw an opportunity to pursue her version of the American Dream when word of her threading expertise led to classmates clamoring for her assistance. She opened a threading store in a local mall. Her clientele grew quickly, and within months, she hired four employees and opened a second location. 

Because threading is so safe, no government license or training is required to offer threading services, and Dipa’s business is thriving. 

Just kidding. If you believed that, you haven’t been paying attention to the licensing industrial complex as it has metastasized across all 50 states.  Fueling this growth are practitioners of various occupations counterintuitively begging the government to impose regulations on them.  In exchange, they gain a sense of legitimacy and monopoly use of a title. These occupations typically have little or no connection to public health or safety – such as flower arrangers, horse massagers, and interior decorators. 

Industry insiders run the unnecessary licensing boards spawned by these regulations, often with no legislative oversight. They have an insatiable appetite for increasing their own job security and earnings by blocking new competitors from the business. Licensing boards are the new unions, and it’s no coincidence that the increase in the former has coincided with the decline of the latter. In the 1950s, only one out of twenty people required a government permission slip to do their job.  Today, that number has skyrocketed to nearly one in three.

Like regulatory black holes, no activity escapes these boards’ jurisdiction. Plucking hairs without a license? Heaven forbid. That is the practice of esthetics, and it can cost you. No encroachment on a licensing board’s turf is too petty to go unpunished. All in the name of protecting the public, of course.  

These protectionist-licensing schemes hurt workers of modest means and young people trying to get their start in life. Which brings us back to Dipa. Business was great, until an inspector for the Mississippi State Board of Cosmetology showed up, issued her a citation, and forced her to close down her business. Dipa had not realized a license was needed simply for eyebrow threading: this was America after all – the land of opportunity. 

When Dipa looked into the licensing requirements, she learned she would be required to take 600 hours of training, which would cost thousands of dollars, and the curriculum would not even teach eyebrow threading.  Instead, the classes would cover waxing, tweezing, makeup, facial massage, and a host of other irrelevant topics. Thinking there must have been a mistake, she contacted the Board. There was no mistake.  

Dipa took many of the required classes, but simply could not afford to take enough time and money away from her graduate studies to complete all of the Board’s irrelevant training.  She pled with the Board to let her thread, explaining that she did not want to perform any of the services taught in esthetician school.  The Board said its hands were tied: state law requires threaders to be licensed – an addition to the law that the Board lobbied for in 2013.  

Of all licensing boards, the Mississippi State Board of Cosmetology should know better.  In 2004, the Board was sued for an almost identical situation: requiring hair braiders to take 300 hours of classes that taught nothing about braiding. After the lawsuit exposed the absurdity of the regulatory regime, then-Governor Haley Barbour signed legislation that deregulated hair braiding.  In the 14 years since that law took effect, over 1,500 braiders have registered new businesses in Mississippi, and nobody has been injured by these unlicensed entrepreneurs. 

Dipa is now represented by the Mississippi Justice Institute, and we are proud to join her this month in filing a lawsuit to challenge the constitutionality of Mississippi’s eyebrow threading laws. But not every budding entrepreneur in America finds their way to a law firm willing to represent them for free. It’s time for the states to adopt substantial and comprehensive occupational licensing reforms. Smothering small businesses in pointless fees and regulation works against our economy and keeps the American Dream out of reach for new generations of entrepreneurs.

This column appeared in the Washington Examiner on August 19, 2019.