Free-Enterprise in Delaware

August 11, 1994

Our neighbors to the east, in the Blue Hen state of Delaware, have a decidedly pro-business reputation. These folks believe in the unshackled, free-enterprise way of life. And to prove it, Delawareans retain their novel system for assigning automobile license tags. Once you get a number, it's yours forever. You can even pass it along to another family member in your will.

Over the years, owning the low numbers (No. 4 is the lowest available after the assignments of No. 1 to the governor's car, No. 2 to the lieutenant governor's vehicle and No. 3 to the secretary of state) has become quite a status symbol. That's where the free-market aspect comes into play. At an auction in Rehoboth Beach this past weekend, license tag No. 9 was sold for an astounding $185,000.

Who would have thought there'd be such an intense market for license tags?

The same family had owned No. 9 since 1934 -- 60 years. It is a black porcelain tag, a remnant of a practice Delaware officials stopped in 1948. Now Delaware's metal tags are blue and gold.

But still, $185,000? The bidding proved intense. As one auctioneer put it, "It's Delaware's version of the Hope Diamond or the Mona Lisa. They are closely held by Delaware bluebloods. And they're passed down from generation to generation."

Indeed, winning bidder Anthony Fusco, a shopping center developer, has six single-digit tags himself. He had to outbid 10 other Delawareans for the prize.

Perhaps there's a lesson for Maryland. This state is sorely in need of new revenue sources. Why doesn't the next governor go Delaware one better and auction off all its license plates?

The Delaware transactions are private exchanges of license numbers for cash. The state gains nothing. But what if Maryland put Nos. 1, 2, 3, etc., up for sale? Think of the windfall (and the sales tax the state could later collect on all license transactions).

With apologies to William Shakespeare, Maryland's current stance seems to be that "a tag by any other number would smell as sweet." But at $185,000 a pop, we'd better change our thinking. What's in a number? Don't ask the Bard, ask the folks from Delaware.

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