Should there be shop-closing laws?
A really cool thing is happening in Germany.
After decades of strict laws regulating when stores can open and close, Leutenschlussgesetze,
the laws are progressively liberalizing.
Since 2006, the decision has been left to the individual states.
Whereas commercial establishments once could not open their doors before 6 a.m. or keep
In the United States, we have no national history of such laws, apart from restrictions on Sunday shopping, which are left to the states and counties, and even with the so-called blue laws, the general trend has been toward liberalization.
The subject intrigues me because it is like so many other subjects that touch on the very
viability of liberty itself.
If you were to think this issue through using what F. A. Hayek calls a constructivist mindset,
the presumption that society is a giant Lego model with pieces that must be assembled and
disassembled at will, it is not difficult to dream up many seemingly reasonable arguments
for why a commercial society must have such laws.
Do we really want to leave such things to the anarchy of the market?
So let's just pretend to be statist constructivists for a moment and see how this works.
A civilized home business will stand no chance against a heavily capitalized corporation
that can more easily absorb the high costs of early openings and late closings.
There are electrical bills to pay and labor costs involved that a small business, which
which might have better products and services, will not be able to afford.
So what is the undercapitalized company going to do?
It will have to choose between adopting the hypercapitalistic focus of its competitors
or closing its doors.
In a footrace, all competitors have the same starting line.
One would never permit one runner to start at a different place from the others.
Why should we permit this in enterprise?
is fine, but the rules have to be the same for everyone.
And think of the workers, they have families, they need downtime, they need a breather to
have dinner with others, read books and cultivate a civilized lifestyle.
No one should be forced to choose between working ridiculously early or late and having
no job.
And yet, this will surely be the result if we just let any business open or close whenever
it wants to.
As for the consumers, surely people can figure out a way to get their shopping done between
6 a.m. and 10 p.m. That leaves a solid 8 hours for sleep, which everyone needs.
If we let people shop at any hour, consumers will naturally choose times when the streets
aren't crowded and the store lines are shorter, which means that businesses will have to stay
open ridiculously long, even 24 hours a day. But with mandatory limits on commercial hours,
Scientists will figure out that they need to get real lives and stop commercialising
the whole of them.
And think about this.
What kind of society do we want to be?
Do we want the entire nation engulfed in the buying and selling of things, or do we believe
that there are other human values that must be part of the balance?
If we permit the anarchy of the market to rule, we make profit and loss the measure
of all human success and failure.
Okay, now that I've made what seems to me to be an impenetrable case for sharp closing
laws, consider that we do not have these laws in the United States, for the most part.
And somehow, against all seeming rationality, the system works, as we all well know.
Chick Phil-A voluntarily closes on Sunday, and McDonald's does not.
Now, they both make a profit.
Many stores stay open 24 hours, and the workers love it.
They have more options to adjust their working hours.
This is good for employment.
Consumers may or may not take advantage of longer hours.
In fact, it is the consumers that dictate whether it is in the interest of the store to stay
open after hours.
Stores may try it and find it pointlessly unprofitable and stop.
For some reason, I don't understand, most barbershops in the South close on Wednesdays.
Such is their right, it works for them.
When it stops working, they will change.
Or it could go the other way.
In my own town, a pharmacy long had short hours, 8 a.m. to 5 p.m., until a big chain
store came in across the street with the 24-7 policy.
Faced with declining profits, the old store adopted the same hours.
Now there are two pharmacies facing each other, each of which is open at all times.
Who wins?
Both seem profitable, but the real winner here is the consumer.
My point is that this is a case where the idea of freedom would seem not to work, from
a constructivist point of view, and where a plan seems needed.
This is true in a host of areas, the freedom to live where you want, work where you want,
invest in what you want, drink or smoke what you want, freely trade with anyone from any
and Money Nation, etc.
You hear these kinds of objections when you propose that any law be repealed.
Why, there will be chaos!
It turns out that the real chaos comes when the state attempts to allocate scarce resources
rather than leaving it to the price system and its talent for revealing what is economically
rational or irrational.
Sharp-closing laws presume to tell people how they should use their time.
But time, writes Mises, is a scarce resource.
Man must economize it as he economizes other scarce factors.
Only private actors, not politicians and bureaucrats, are in a position to make decisions concerning
how it is used.
Their choices can be accessed based on a business model, rather than arbitrary political wrangling.
This is why liberty works and the state fails so miserably, and why the best laid plans
in politics never work out as expected.
Consider the case of patents.
People say that if we get rid of patents, no one will invent anything anymore, and those
who do will have their ideas and just profits stolen.
And yet, for most of human history, patents have not existed, and patents have not been
part of the biggest technological explosions in our history.
In fact, the opposite is true.
Patents slow down the pace of development by granting monopolies to favored producers.
They thereby discourage innovation in the name of encouraging it.
This is why I found Ron Paul's answer on the drug question at an early Republican debate
to be so incredibly brilliant.
The questioner asked him if he would favor legalized heroin.
The viewers are supposed to be horrified and surely many were.
He said the real issue is liberty.
And then he asked the question, how many people here in this room would start using heroin
if it were legal?
How many people would say, oh, we have to have these laws to keep me from being an addict?
Everyone cheered because we knew the answer.
There is a remarkable rationale behind what he said.
He pointed out the simple truth, that we are all what we make of ourselves, and the state
isn't really making us better people.
To be a good or bad person is a choice, and the state's laws don't really possess the
magical power to influence that decision.
This was an extremely rare moment in human history when good sense actually emerged from
a political debate.
It often happens that when societies adopt some constructivist rule, the inner contradictions
eventually end up leading to its repeal.
This is what happened in Germany.
The closing laws couldn't really apply to gasoline, for example.
After all, we can't have people pulling over on the autobahn and sleeping while they wait
for the gas stations to open.
Then the bakers too pointed out that they have to be open earlier.
Then there are shops for tourists who don't have all the time in the world, so special
Zones of Freedom were created for them.
Gradually the laws were eroded, to the point where human choice was permitted to prevail.
Does this cause a race to the bottom?
No.
In other words, it makes everyone happier than they would otherwise be.
It makes for a better society.
Liberty works because it permits people to work out their problems through exchange and
cooperation.
No one is coercing anyone to do anything.
Everything happens through consent.
Nothing happens through force.
In some ways, liberty is the craziest and most implausible idea anyone ever dreamed up.
And yet, only liberty really accomplishes that seemingly elusive dream of a prosperous, orderly
and peaceful society, in which every member is permitted to have a role in its development.
It takes some imagination to understand how.
We are fortunate to be living in times when the digital world of relative freedom is providing
us a model of the ideal.
Every day there is improvement.
Every day we are served up better and better ways of doing things.
Imagine if the physical world were just as free as the digital one, drawing on the creative
powers of everyone in the world and the service of the common goal of finding ever better
ways to do things.
What would life be like?
How much are we being held back by the seemingly necessary laws that actually make us all poorer
and less civilized than we would otherwise be?
It takes a certain kind of brilliance to imagine such counterfactuals.
This is why we owe a particular debt of gratitude to the liberal tradition of thought for helping
Letting us make sense of how the truly implausible can become the only truly workable ideal.