Doing the State’s Bidding on eBay

I love eBay. It’s about as close to unfettered capitalism as you can get under the present circumstances. Buyers offer what they have to sell; sellers offer the prices they’re willing to pay. When supply and demand meet, a sale is made. Caveat emptor is the rule, but eBay’s feedback and complaint processes are a relatively efficient way of weeding out the frauds.

I’ve bought and sold items on eBay for years. Buying is much easier (except on the pocketbook) than selling, which can be time consuming. As easy as it is to list an item for sale, it still takes a certain amount of time. In addition, it is usually a good idea to shoot and upload one or more photographs of the item, and then there is time spent answering inquiries from prospective buyers and packing and shipping the item if it sells. If you only sell a handful of items a year, it’s not a big deal; but if you frequently have things to hawk, you’re going to put in a considerable amount of time creating listings on eBay and packing and shipping the sold items.

Fortunately, the market has come to the rescue in the form of third-party sellers who will do all the hard work of photographing, listing, packing, and shipping your wares – for a fee, of course.

Unfortunately, wherever the market succeeds, you can rest assured that the state is not far behind to stifle this success or at least to get a significant cut of it. Thus it transpires that the Commonwealth of Pennsylvania is now threatening third-party eBay sellers with fines of $1,000 (or possibly $1,000 per item sold) for the horrific crime of selling merchandise at auction without an auctioneer’s license, issuance of which is, conveniently, the exclusive domain of the bureaucrats in Harrisburg.

How does one go about acquiring one of these licenses? According to the state’s website, the prospective auctioneer must:

"Serve an apprenticeship as a licensed apprentice auctioneer for a period of not less than two years in the employ of a qualified auctioneer and participate for compensation in no less than 30 auctions; OR
"Successfully complete a prescribed course of study in auctioneering of at least 20 credit hours at a school approved by the board. A credit hour of instruction is defined as 15 standard hours of instruction, each of which is composed of 50 minutes. . . . ; OR
"Apply through reciprocity from a state in which we have a reciprocal agreement . . . ; OR
"Apply through a Non-Resident Exam Application . . . ."

Once one of the above is completed, the prospective auctioneer must take an auctioneer’s examination; and once he has passed that, he can apply for a license. Naturally, there are fees for the exam and the license, and the person wishing to obtain a license must post $5,000 bond with the state. In addition, the license expires every two years and must be renewed at additional cost.

The commonwealth, of course, claims that this is all done to protect consumers. Think of the dangers inherent in letting just any old Joe Schmoe auction off other people’s goods when Mr. Schmoe has not spent 2 years as an apprentice (under someone else who has paid his dues to the state) or 250 hours sitting in class (at a school which has groveled sufficiently before the government, and probably paid up, to earn its approval) learning how to talk really fast! Why, bidders might actually understand what he’s saying! We can’t have that.

As if it weren’t ridiculous enough that someone would have to go through all of this just to auction off pigs at the county fair, the law is stretched to the point of absurdity to demand that people submit to this kind of lengthy training in techniques that are clearly useless on the internet. How on earth are consumers protected by forcing third-party internet sellers to learn how to rattle off bids a mile a minute in front of a live crowd?

At least one third-party seller whom the state has (or is trying to) run out of business understands exactly what’s going on. As the AP report linked above says:

Barry Fallon, who ran a business called iSold It on eBay in Lower Paxton Township, has been summoned to appear before the state Board of Auctioneer Examiners. He said the board is dominated by traditional auctioneers who fear competition.

"(It's) kind of like having the buggy whip manufacturers decide whether to allow new automobiles to be sold," Fallon said.

Not only are existing auctioneers trying to keep competition down by forcing online third-party sellers to pay up or pack up, but I’d lay odds that the auctioneering licensing law itself was originally written and passed at the behest of already successful auctioneers for precisely the same reason. Find me a licensing law that wasn’t created to stifle competition for those already established in the profession, and I’ll find you a living, breathing unicorn.

As always, the "consumer protection" laws end up hurting the very people they’re allegedly designed to help. Again from the AP story:

Mary Jo Pletz of Walnutport, about 20 miles north of Allentown, quit her job to stay home when her young daughter was diagnosed with an illness.

She started selling other people's furniture, clothing and antiques on eBay, and went on to sell more than 10,000 items online. But a few days after Christmas last year, she got a visit from the Department of State and has since shut down her business.

Neither she nor her attorney can determine if her potential fine is a flat $1,000, or $1,000 per item sold, she said.

Now there’s a good law for you – so convoluted that even a lawyer can’t make sense of it. But that’s just the point: Make enough laws and make them impossible to decipher, and you can send anyone up the river for something as long as you get an unscrupulous enough prosecutor and a pliable enough judge.

Let’s just go right to the fundamental issue here. Any two people ought to be permitted to come to a voluntary agreement whereby one sells certain items belonging to the other at mutually agreeable terms. The state ought to have no say in it whatsoever, whether the items are being sold out of a barn or on eBay. It’s a simple matter of property rights, the very bedrock of freedom.

On the other hand, since all property owned by the state has been stolen from the citizens therein, I propose an online auction of all government property, with the proceeds divided equally among the taxpayers. I know how to sell things on eBay, and I’d even do it on a no-commission basis as a service to my fellow man. That would at least provide us with a measure of restitution. If the Commonwealth of Pennsylvania wants to prosecute me for doing this without a license, well, good luck stringing me up, fellas, once you own no guns, courtrooms, or prisons.

November 21, 2007

Michael Tennant [send him mail] is a software developer in Pittsburgh, Pennsylvania.

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