Land of Opportunity? More Like the Land of Regulation!

by Raelynn Rhodes, Age 17
Submitting Teacher: Brenna Rhodes

A few years ago, I had a dream. I wanted to bake and sell my own dog treats. I already had two proven recipes that my own dogs loved, and I am an accomplished baker. So, here in America, the land of opportunity, I had no doubt that I could achieve my dream, be successful, and earn some money toward my first car. I am a hard working farm girl raised in the great state of Texas. I know how to hustle and get things done. Work ethic, initiative, talent and perseverance are just what it takes to get an American small business off the ground, right? Wrong.

Jeff Rowes, of the Institute for Justice, said it best. On John Stossel's "Overregulation" segment from his Fox News hour, War on the Little Guy, Rowes stated: "America was conceived as a sea of liberty with islands of government power. We are now a sea of government power, with ever shrinking islands of liberty." I was about to learn that even a young American with the initiative to bake and sell dog treats could be swallowed up in that massive sea of regulation.

As it turns out, what it takes to bake and sell dog treats is a Texas Commercial Feed License. These licenses are granted through the Office of the Texas State Chemist. I was surprised to learn this, since my treats are meant to be just that a treat. I did not want to sell a complete diet for dogs. My dog treats have four simple ingredients and are even healthful for human consumption. But, a license was required. Undaunted, I set out to get that license.

My first hurdle was the incomprehensible Pet Food Rules in the Texas Administrative Code. With some help from my parents, I was able to decode enough of the fifteen pages of tiny print to start the application process. But, that was only the beginning.

There were complicated labeling rules to be followed, and in order to have correct labeling there was a slew of other requirements and associated expenses. These specific requirements were not even clearly described in the lengthy document I had studied, and through phone calls I learned that the regulatory agency could basically require any information they wanted.

First, I had to locate a lab to test my dog treats for guaranteed nutritional analysis. I paid to have the treats shipped to the lab and tested. I purchased new packaging and labels that would hold all the required information. I needed room to print the product name, an ingredient list, species for which it was intended, and protein, fat, fiber and moisture content. The label had to have the name of the party responsible for making the treats. I had to determine and print not only a quantity count for each bag of treats, but a net weight per package. And finally, my label had to state that the product is "intended for intermittent or supplemental feeding only." And, although the word "treat" is in the name of the product, regulations required that my label contain the sentence, "Feed as a treat or snack." Surely people are smart enough to know that dog treats should be fed as snacks. But, it's in the rules, so on the bag it went. All this over treats? For dogs?

Six weeks and $201 later, I finally was licensed to make and sell dog treats.

In a free economy, if I had just made a bad dog treat, word would have spread, and people would not have continued to buy them. Wouldn't that be a very simple way to weed out people who make bad dog treats from people who make good dog treats? Customers who pay a premium for dog treats expect a good product. Over time, only good dog treat makers would survive and make money in this business. Instead, my government has pages of regulations that don't make dog treats any better; they just make it harder to be in the dog treat business.

And those regulations certainly had unintended consequences. Too many rules drive business owners to the underground. I saw this happen first-hand. While I diligently jumped through regulatory hoops to get approved and licensed, my competitors were selling their dog treats without a license. Maybe they couldn't figure out how to get one, or didn't want to go to the time and expense. I hardly blame them, because for several weeks, I watched my competitors go about the business of making money in a free market, while I was about the business of hoop jumping through bureaucracy.

You might wonder if overregulation killed my spirit of business adventure or discouraged me from dreaming up other business opportunities for myself. The answer would be yes, to some extent. It was incredibly frustrating to see the reality of doing business in an overregulated society. I actually had to ditch one of my dog treat recipes and choose to market only one flavor, because each recipe would require additional fees and licenses, and my small business just can't afford that extra annual cost. Now that I know how overregulation hurts the little guy, I am more likely to approach business ideas with some cynicism I didn't have before. And that's a shame, because to have a vibrant economy America needs the energy and optimism of its youth.

I am proud that I did see my dream through, and today I make and sell dog treats. I also send in my paperwork and pay my annual licensing fees so I can stay in business. I didn't let the rule-makers win. But, I surely wasted lots of time and money getting here. If overregulation wasn't such an integral part of most entrepreneurial endeavors like mine, can you imagine what America's bright young minds could achieve?