As the Legislature prepares to convene after a year of shutdowns and government restrictions on the professional and social lives of Nevada residents, they will not only look to help an ailing economy, but also make it more resilient to future economic downturns.

With the state’s major economic hub, Las Vegas, facing the highest metropolitan unemployment rate in the nation, it is easy to see why lawmakers—including Gov. Steve Sisolak—are once again focused on diversifying the state’s economy. Succeeding, however, would be no small feat, given the way this state’s economy, culture and politics are structured.

While Gov. Sisolak teased the idea of “innovation zones” to boost economic development in his State of the State address, it’s worth pointing out that some of the most basic ways the government could help deepen economic diversity in the state don’t seem to be on anyone’s priority list.

Despite the fact that Nevada’s occupational licensing requirements are the second worst in the nation—meaning they are unaffordable and impractical for most low- and middle-income workers trying to embark on new careers or change industries—there is a notable lack of interest among lawmakers for reform.

While Gov. Sisolak’s administration has shown interest in the past for reforms to the state’s overly burdensome occupational licensing laws, lawmakers themselves have shown great apathy toward any sweeping changes. Virtually no one has offered the kind of reform that would rein in burdensome licensure requirements—such as expanding apprenticeship opportunities in lieu of often costly formal training, recognizing valid out-of-state licenses and permanently lowering exorbitant “processing” and registration fees.

Even mundane professions, where there is little or no risk to the public, are affected by the current state of runaway fees and requirements. Interior decorators, for example, must complete four years of education, two years of “relevant experience,” complete an exam and pay $1,215 in fees (not including the cost of education) to legally engage in their chosen career. Cosmetologists, landscapers and more than 70 other mostly low- and middle-income professions face similarly outlandish requirements, resulting in many struggling Nevadans unable to afford the financial burden associated with pursuing a new career. 

The lack of interest in reforming such basic roadblocks to success does not bode well for the grander issues standing in the way of economic diversification. The state’s education system, for example, has proven itself completely incapable of prioritizing the needs of students during “good times,” let alone during the pandemic.  

Outlining his priorities for the upcoming legislative session, Gov. Sisolak seemed to at least tip his hat to the notion that Nevada might need to rethink how it spends its dollars on education, saying, “The dollars should follow the students, rather than being connected to districts or schools.”

For a line that sounds directly lifted from a school choice advocacy group, it’s safe to assume such a concept—of empowering families, rather than specific government-run classrooms—will run into roadblocks within the governor’s own party. In the last legislative session, not only did Democratic leadership consider moratoriums on new charter schools, but they also reduced funding for Opportunity Scholarships for low-income students and completely killed the state’s (unfunded) Education Savings Accounts program—a program that would have done precisely what Gov. Sisolak claimed to support in his State of the State speech: tie a portion of per-pupil funding to the child rather than to a government-run education system.

A more robust, diverse and decentralized education environment would not only make the state more appealing to individual families looking to relocate, but also more appealing to companies looking for a location with a plethora of educated homegrown talent. Alas, the politically powerful education establishment in Nevada has long resisted giving up its per-pupil funding so parents can seek non-government educational alternatives—rendering such a reform likely dead on arrival in the Legislature.

Despite the unlikeliness of these two reforms, Gov. Sisolak’s proposed budget for the next biennium promotes one important aspect of rebuilding, reenergizing and diversifying the Nevada economy: No new taxes.

The greatest economic development tool currently in Nevada’s toolbelt is the fact that, despite tax hikes in recent years and an ever-growing squeeze on small businesses, we remain a highly affordable place to do business. And protecting that relatively low-tax environment doesn’t have to mean gutting the state’s budget.

In fact, Gov. Sisolak’s proposed budget is far from some draconian austerity-style slash to government funding. Presented as a mere two percent cut from last biennium, the proposed budget manages to reverse cost-saving measures considered during the worst days of the shutdown—including the almost comical one-day-per-month furlough for government workers.

However, despite the governor’s “no new taxes” approach to shielding government from the kind of devastation felt in the private sector, the threat of new taxes nonetheless looms large in the 2021 legislative session. The Clark County Education Association, for example, has petitioned the Legislature to consider raising Nevada’s average sales tax to the highest in the nation. And while lawmakers currently seem hesitant to acquiesce, there’s always concern that legislators from both parties will succumb to the pressure of government lobbyists and public sector unions pushing for more revenue in the wake of a major economic downturn.

If lawmakers are serious about rebuilding and diversifying the economy, they need to understand that the greatest tool available to them is the entrepreneurial spirit of Nevadans themselves. Empowering Nevadans with educational options and the freedom to pursue the livelihoods they choose—without undue restrictions or financial burdens—will be far more powerful than any “innovation zone” or GOED-planned scheme to bring in new businesses.

Unfortunately, many of the reforms needed for such a citizen-driven economic recovery are far from being on the priorities lists of those who are calling for diversification. As has been the case for decades, it seems this year’s focus on “diversifying” the economy is merely an excuse for government insiders to sound good while they continue to protect the status quo that serves their narrow interests.

Unless that changes soon, the diversification of Nevada’s economy will just have to continue to wait.

Michael Schaus began his professional career in the financial sector, where he became deeply interested in economic theory and the concept of free markets. Over a decade ago, that interest led him to a career in policy and public commentary—working as a columnist, a political humorist and a conservative talk show host. Today, Michael is director of communications for the Nevada Policy Research Institute and lives with his wife and daughter in Las Vegas.