file photo by Boyd Loving
the staff of the Ridgewood blog
Ridgewood NJ Gov. Phil Murphy recently signed into law a consumer-friendly bill that was pushed by the Commerce and Industry Association of New Jersey and a statewide movers’ group to eliminate companies that try to scam the public.
The new law cracks down on unlicensed movers, who operate without insurance, often cheating and scamming consumers. The director of the state Division of Consumer Affairs can now work with local police to impound vehicles used by illegitimate movers. Police can also bring disorderly persons charges against rogue movers. If convicted, the penalty could be up to up to six months in jail and a maximum fine of $1,000.
The bill received bi-partisan support with Democratic Sen. Paul Sarlo and Assemblyman Thomas Giblin, as well as Republican Sen. Declan O’Scanlon and Assemblywomen Serena DiMaso and Amy Handlin, all agreeing to become sponsors. Democratic Sen. Patrick Diegnan and Assemblyman Pedro Mejia were co-sponsors. The bill was passed unanimously by both houses in June and signed into law by Gov. Murphy earlier this month.
CIANJ President Anthony Russo said the legislation was stalled when the New Jersey Warehousemen & Movers Association turned to his team for help. Russo assigned Anthony Perry, the CIANJ director of government affairs, to work strategically with the movers’ leadership to build consensus. “This bill makes sense in every way. It brings fairness, while leveling the playing field and protecting consumers.
“We’re pleased that we were able to use the good relationships we have developed among the state’s legislative leadership and the governor’s office to see this bill become law,” Russo said.
Robert Russo, executive director of the movers’ association (no relation to the CIANJ president), said the legislation was needed because “there are hundreds of unlicensed and uninsured movers operating in New Jersey, attracting consumers with low rates that morph into bait and switch scams that often exceed rates offered by licensed movers.” He said the illegitimate movers cost the state millions of dollars in lost tax revenues and fees each year.
According to the movers’ association, there are more than 320 licensed movers and warehousemen throughout the state. Robert Russo accompanied the CIANJ team in meetings with legislators and in testimony before legislative committee, urging action on the bill. Cindy Myer, the president of Ridgewood Moving Services, who is also chairwoman of the board at the movers’ association, was instrumental in bringing her group to CIANJ for help. As a CIANJ board member, Myer knew the strengths of the association and brought it to the attention of the movers. CIANJ is a statewide business advocacy organization representing more than 900 businesses from every industry sector.
“We greatly appreciate CIANJ’s efforts and are very thankful it’s finally law,” she said. “It’s a win-win because it helps licensed movers, protects consumers and discourages illegal activities.”
A great example of what economists call “rent seeking” and others call “crony capitalism”. A business association (in this case “a statewide mover’s group” — note the anonymity) petitions the government for protection from lower cost competitors. The government cooperates and makes the judicial mechanism of fines and/or imprisonment available to the movers group. In return, we can bet that there will be donations to plenty of political campaigns.
Consumers are perfectly capable of deciding to either use licensed movers or roll the dice with unlicensed ones. Maybe that user group could go to the effort of gathering and publicizing complaints to make it easier to pick reputable companies. But it’s obviously cheaper and less work for the state to do that for them with the added benefit of jail time for their competition.
Rent seeking goes on in many, many industries. It’s one of the major impediments to those at the bottom of the ladder who want to move up.