Free markets work through competition. Sellers offer an array of goods and services and buyers tell them what works. So when protectionist legislation favors one group of competitors over another, there’s a problem. That’s what’s happening to E. Glen Porter, who owns a cemetery in New Berlin, Wisconsin.
The problem is that Porter would also like to own and operate a funeral home. He believes that many grieving families would like an opportunity to deal with someone who can provide a full panoply of goods and services to help memorialize their loved ones. But the state of Wisconsin won’t let him.
In the 1930s, Wisconsin banned joint ownership of funeral homes and cemeteries to protect funeral directors from a then-new form of competition: combination firms that sold both cemetery and funeral home services.
On behalf of Porter, the Wisconsin Institute for Law & Liberty has sued, alleging that the state of Wisconsin has unconstitutionally infringed on his economic liberty and right to earn a living. We will argue the case in the Wisconsin Supreme Court on April 19.
Many firms offer packages of goods and services that could be sold separately, the way Porter would like to with funeral home and a cemetery services. They do so because some customers like to deal with a single firm. Or they find a package of combined services more convenient.
Take Disney, for example. It’s February and your family is planning a trip to Orlando. The plan is to get some sun and take the kids to Disney World. Making arrangements can take a lot of time and you just want to relax, so you see that Disney has a package deal that combines passes to the theme parks with a five-night stay at a Disney resort. You opt for the package deal because it is efficient and worry free.
But just because Disney offers a package deal doesn’t mean that consumers don’t have other options. Disney also sells theme park tickets and there are lots of independent hotels right next door to the Disney reports. They compete with Disney’s package deals and do so very well. It would be odd if Florida sought to protect independent hotels from competition by telling Disney that it can’t be in both the theme park and the hotel business. It is equally bizarre to ban the joint ownership of funeral homes and cemeteries, as in the Porter case.
For example, Uncle Frank is planning his funeral before he passes and he’s looking at all of his options. He decides to go with Porter’s funeral home because there is a package that also includes the burial at the cemetery and Uncle Frank likes the idea of one-stop shopping. What’s wrong with that?
Other people might make other choices. Aunt Billy Jo’s family is making the arrangements for her funeral. After considering Porter’s funeral home, they decide to go with Smith’s Funeral Home, even though they will need to make separate cemetery arrangements with Porter. There is nothing wrong with this option either.
It is true that a combination firm—like any other firm—could theoretically engage in anti-competitive practices that try to push competing businesses out of the market. But there is no reason to simply assume as a matter of law that they are likely to do so. Disney has not put independent hotels out of business in Orlando. And in any case, a firm that did act anti-competitively would be subject to criminal and civil penalties under state antitrust law. Few firms are willing to take that risk.
As is clear in the case of Uncle Frank, E. Glen Porter’s combined funeral home and cemetery would actually be adding more options to the marketplace, therefore making it more competitive. The Wisconsin Supreme Court should let Porter have his cemetery and a funeral home and let consumers make the decision of whether to buy package deals or purchase arrangements separately.