Imagine you’re an established white-collar professional working out of a small office. Above your desk is a government-issued piece of paper that says you know how to do your job. Work is steady because (a) everyone needs your services, (b) your industry operates within a state-protected monopoly, and (c) the supply of qualified professionals in your field is limited by the available quantity of business licences (one of which you own, having purchased it many years ago at great expense).
Now imagine that a competitor opens a business across the hall, offering the identical service. He’s got no accreditation whatsoever. But he claims he doesn’t need any, because he’s using a new kind of information technology to get his customers. Instead of these customers phoning him to make an appointment, they use an app. Totally different thing.
You call the government to complain, and they dispense an investigator. But she’s powerless to sanction the unlicensed competitor, because judges are uncertain how to deal with this new phenomenon. And politicians are afraid that if they enforce the rules, constituents will complain. Moreover, it turns out that a lot of customers resented the old monopoly. They want more choices, and they love all the high-tech features that come with the new app. So public officials shrug and wait for the process to play out.