Using an ordinance meant to target unlicensed or “bandit” taxis, the Los Angeles Police Department has been arresting hundreds of ride-hailing drivers in undercover sting operations. In 2013, when Uber and Lyft first entered the L.A. market, a mere 4 percent of bandit taxi arrests were against ride-hailing drivers. Today, that figure tops 40 percent, with over 240 ride-hailing drivers arrested just last year.
Here’s how the stings go down. Posing as ordinary pedestrians, undercover officers wave down cars with Uber logos. The drivers who stop typically think the person either needs help or can download the app on the spot. If drivers pull over, officers tell them they don’t have the Uber app but offer to pay in cash. Drivers who accept the fare are then met almost immediately by squad cars and handcuffs. No wonder some Uber drivers caught in a sting have called the city’s tactics entrapment.
The rise in arrests just so happens to coincide with plummeting demand for traditional taxis…
Now there’s a surprise!
Arresting Uber drivers for doing their job? And for providing what customers want? This is crazy. In fact, I’d call it downright evil. And yet (sadly) it’s entirely consistent with the idea that private enterprise must be “regulated.”
The politicians who support the LAPD for arresting Uber drivers claim to represent “the people.” Which people? Taxi drivers, of course. Because that’s what government regulation always amounts to, in the end. Government regulations and licensing have nothing whatsoever to do with protecting the public, and everything to do with protecting a competitor who’s losing customers. Regulations hamper the innovative for the sake of preserving the status quo. It’s not because of any “public interest,” but because the status quo benefits financially and otherwise from supporting politicians who do their dirty work for them.
We wonder why America is no longer the great, robust and innovative place it once was. This is why. Imagine if government had regulated the newly developing automobile industry in favor of the horse-and-buggy drivers and the people who made the buggies. Henry Ford would have been arrested and the old way of getting around would have prevailed. The streets would still smell like manure and civilization as we know it would not exist. That’s what Los Angeles is now doing to Uber. It’s not just the Los Angeles government, but also city and state governments throughout the nation, as well as the federal government most of all. Health care and education are a mess? It’s because the federal government has strangled these fields. It’s regulating innovation to death. As a result, we’ll never know what we’re missing out on, because government snuffs out so much.
Arresting Uber drivers for the sake of “the people”? Give me a break. The Uber drivers are real people. They are not criminals, and they are not hurting anybody. The Uber customers who will have to go without cheap and reliable transportation are people, too. Why is it only the politically connected groups and people who have rights? That’s the problem with our entire country. Want to know what “the swamp” is? Government is the swamp.
In fairness, taxicabs are a heavily regulated industry in most cities. There’s justice in their claim that it’s unfair to regulate one transportation industry while leaving another alone. However, the solution is not to regulate Uber. And the solution is definitely not to arrest Uber drivers! The solution should be to deregulate the taxi industry.
Nick Sibilla, a writer at the Institute for Justice, points out that two years ago San Diego lifted its limit on taxi permits, which, thanks to artificial scarcity, could fetch upwards of $140,000 on the secondary market. In Orange County CA, Supervisor Todd Spitzer has proposed deregulation to “make it a level playing field” for Uber, Lyft and traditional taxis. It makes sense, because the only true “level playing field” is an open market where customers, producers and service providers decide what they need. The hell with government regulators and paid off politicians deciding for us what we may and may not purchase, and under what terms!
Sibilla also asks us to consider one example of how economic liberalization in the cab industry can work: Minneapolis. Ten years after the city deregulated its taxi industry, taxi licenses are up 185 percent, while the number of cab companies has more than quadrupled. Who benefits? Customers: The people politicians and regulators always claim to represent, but almost never do.
An unhampered, unrestrained free market would solve so many problems. During the otherwise dreary and government-obsessed Obama years, Uber offered a shining glimmer of what might and ought to be, if only we’d let free markets and free minds prevail.
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