Is Licensure Good Business?

I've had 10 years to think about this question … With a few misgivings, I conclude that the correct answer is YES. I think is makes good business sense to be licensed.

In early November 2002 I mailed in my application to be licensed by the State of Texas as a Professional Geoscientist. As a petroleum geologist and businessman practicing in the private sector, I didn't really need to, being exempt under the Texas licensure statute, which applies primarily to geoscientists practicing in the environmental, water resources and engineering fields.

Nor am I philosophically very sympathetic with the idea that state regulation is a reliable protector of the public trust. After all, doctors, lawyers and engineers have been licensed in Texas for years, but we still see frequent media reports about mistreated patients and clients — and consequential malpractice lawsuits.

Most faithful readers of this column have, by now, recognized my faith in free markets as generally being more efficient than government in solving such problems. Crummy doctors, crooked lawyers and incompetent engineers will, sooner or later, find themselves out of business as their tarnished reputations get around.

Trouble is, sometimes it takes too long — and trusting clients can get badly hurt in the meantime.

Following Adam Smith, I do recognize that there are a few things government can do better than the free market — protect the borders, keep the public order, maintain the currency, regulate interstate commerce, serve as the last safety net for the down-and-out.

Does state licensure of the geologic profession also belong on that list?

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I've had 10 years to think about this question, having first become involved in the campaign for licensure of Texas geoscientists in 1992. With a few misgivings, I conclude that the correct answer is YES. And for all Texas public-sector geoscientists (and most private-sector geoscientists and geophysicists as well) I think it makes good business sense to be licensed.

Here's why:

• Licensure probably will drive out a few unqualified practitioners who currently seek project work in the public sector — and it will provide a sound legal and financial framework for disciplining geoscientists who get out of line, being backed by the authority and resources of the state.

  That's likely to be more useful than the ineffective sanctions of AAPG, AIPG or SIPES.

• As soon as the "Grandfather period" expires on August 31, licensure will establish some minimum standards of knowledge and experience for all future applicants through a demanding qualifying examination. This will provide some needed pressure on academic departments to provide coursework of sufficient rigor and breadth that their graduates will not only qualify, but also have a fair chance of passing the exam.

  In Texas it also will require state, county and municipal geoscientists to demonstrate at least threshold competence.

• Geoscientists, even those in the private sector, occasionally may have to testify in state regulatory hearings or litigation. Being licensed demonstrates at least minimum competence, experience and character.

  More important, it puts the geoscientist on an equal footing with other recognized professionals who may be involved in such testimony, especially engineers.

• Petroleum geoscientists recognize that theirs is a volatile business. Oil and gas prices vary; companies merge; jobs vanish. A lot of successful hydrologists, environmental geologists and geohazards specialists started out as petroleum geoscientists. Some were downsized out as the E&P business shrank over the past 17 years.

  Such career shifts may also occur in the future, so be prepared.

  Also, some consulting geologists just want to maintain a broad practice — petroleum, ground water, environmental, etc.

• When public-sector geoscientists did not have equal standing with engineers before the state, most became "second-class citizens," working at substandard pay scales and always serving in subordinate positions because they could not officially warrant the quality of project work via a formal seal. That's why nearly all geotechnical and environmental consulting firms are owned and operated by engineers — and it's one reason why some Texas engineers fought hard to keep Texas geoscientists from becoming licensed.

  This represents one of the admitted "down sides" to state licensure — the state-reinforced suppression of free trade by those who are licensed, of those who are not. The new Texas board of geoscientists must be alert not to allow such abuses to occur.

• For years, too many geologists and geophysicists did not think of themselves as professionals, belonging to a professional community — scientists, or employees, or technicians, or prospectors, yes. Professionals, no. (A surprisingly large number of geoscientists are not even members of professional associations!) This has been a largely self-imposed handicap, one that has hurt the geoscientific community badly. It is, in my opinion, a chief cause of the absence of geoscientists from corporate boardrooms and public policy forums.

  Licensure may help us develop a more professional self-image, which may lead in turn to growing — and badly needed — public influence.

  When my license to practice as a Texas geoscientist arrives, I intend to put it in a dignified frame and hang it in a special place on my office wall, next to the AAPG Code of Ethics. It took a lot of sweat, worry, time and money to finally persuade the State of Texas to license my profession and, even if my free-market, limited-government philosophy winces a bit, I'm proud of it.

  And as a long-standing businessman and geoscientist, I believe the $200 is a sound business expense. I hope my Texas geoscientist colleagues (as well as otherwise unlicensed out-of-state geoscientists who intend to practice in Texas) will see it the same way.

Those seeking information should visit the Web site of the Texas Board of Professional Geoscientists at http://www.tbpg.state.tx.us/.

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Recommended reading: The Tipping Point, by Malcolm Gladwell: Little Brown Co., 2000. The spread of new ideas, social trends and commercial products resembles the progress of epidemics, taking off when they reach critical mass, called "tipping points." Find out about key elements — the Law of the Few, Stickiness, and the Power of Context. A must for anyone trying to grow a business.

Read it — you'll like it!