NOTE: While this is about Uber it is not about whether Uber is good or bad – that is a different discussion. This is about the ineptitude of government in managing regulated industries …
Apparently the BC government thinks the writing is on the wall as far as Uber goes. “B.C. government suddenly open to arrival of Uber” reads the headline today.
They’re saying it’s only a matter of months before the service will be OK in BC.
Transportation Minister Todd Stone said this: “the two industries can coexist side-by-side, thrive and grow …”
When operators on one side are forced by regulations to purchase, at great expense, one of a limited number of Taxi licenses but the other side is not: How can that lead to a thriving business?
The government charges only $150 for a Taxi License so you might wonder where the great expense is.
- Well there are only a limited number of them.
- They are of indefinite term in nature so that effectively means ‘forever’.
And they are transferable.
- What that all means is that the $150 item can be sold at auction for well over a half million dollars. Recently at a closed bid auction one went for over $800,000.
Put this all another way:
Let’s say YOU are one of those TAXI people who actually have close to a million dollars invested in your Regulated business. Since you didn’t have cash to pay for that expensive Taxi permit you likely financed it in some way.
Now you WILL have to to compete with an Unlimited number of startups that have relatively next to no cash requirements to get going. No expensive
hard impossible to get Taxi License needed for the vehicle or business. Nope.
And the government says your business will not only be able to compete but thrive as well?
This is from a government minister, Todd Stone, whose only previous connection with transportation was to be a Board member at ICBC. (Okay, he has likely been a Taxi customer in the past)
He does have a background in software though.
And that’s the crux of this: UBER is a software/technology platform not a Taxi business. The government’s point man on this comes from one side of the argument. (it’s not all that different from when they appointed a person from the cattle ranching industry to a position to decide on parks and cattle grazing)
As numerous people have pointed out over the years the government has failed to properly manage the taxi business and how it serves (or services) the public. Populations and riders have increased but the number of taxi licenses has stayed almost static. The system served the desires of those who are already entrenched to keep new competition out. And the regulators never wondered or looked into the way it has been gamed in what amounts to willful ignorance on their part. Now that the government is forced to think about it by the pace of technological change it’s not serving the taxi business.
In the long run the public will have some sort of access to a taxi-like service but between now and that time a bunch of people are going to go bankrupt and a whole industry will be damaged. And in that future time will the public be safe and secure in their rides or at the mercy of whatever safety / security the non-regulated operators have chosen to implement (or not)? Or will that be just another fire for a future government to put out?