Regulation vs. Getting Around

Tuesday, October 09, 2012

According to Ars Technica, several startups have found ways to connect people who need transportation to car drivers willing to take them there -- a blessing in a city such as San Francisco, which reputedly has atrocious taxi service.

Our government, consistent with its policy of meddling in everyone's affairs, is, of course, rewarding these entrepreneurs with legal threats and investigations:

Three San Francisco ridesharing startups have been hit with a cease-and-desist letter by the California Public Utilities Commission, the state regulator that deals with public transportation-related issues.


These firms had previously argued that because they merely are a ridesharing website that takes "donations" rather than "fares," they are not taxi companies. As such, according to the companies, they should not be subject to traditional taxi regulation. State regulators clearly disagree.

"Public Utilities Code section 3571 states that no charter-party carrier of passengers excepting transit districts, transit authorities, or cities owning and operating local transit systems themselves or through wholly owned nonprofit corporations shall engage in transportation services," the letter states.
Do note that the companies are cheaper than taxis, exceed some of the regulatory standards for taxis, and even offer services that no regulator would even dream of, such as ratings systems (of drivers by customers and vice versa).

The businessmen who run these services are trying to operate within the limits of the law, and none seem to be raising the issue of whether such laws are proper. This is understandable, but wrong: How many people -- even though they should -- are going to think to question the way practically everything is run these days? Perhaps the thick-headed persistence of the government regulators will make the issue of their legitimacy easier to raise in spite of this going-along-to-get-along.

If government regulation is supposed to help the public acquire safe, reliable, and reasonably-priced transportation, why is it so obviously failing here? Why are people -- acting in their own selfish interest -- doing everything we supposedly need the government to force them to do? And why aren't taxi companies scrambling to adopt some of the practices these companies have pioneered? Finally, by what right does some pencil pusher tell complete strangers -- at the expense of money stolen from complete strangers -- to stop engaging in  mutually beneficial activity?

The solution to the outrage of government regulation isn't to go along with it or to cleverly skirt the law (such as by taking "donations" rather than demanding payment for services). It's to question its propriety and seek to abolish it.

-- CAV

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