NYC Ridesharing Attack Would Level Drivers, Riders, Companies But Not the Playing Field

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Posted by Doug Kellogg on Wednesday, May 2nd, 2018, 1:40 PM PERMALINK

The New York City Council is considering major attacks on ride-hailing apps.

The most aggressive measure, pushed by Coucilmember Ruben Diaz, Sr., “who has received donations from the taxi industry”, hits the trifecta of hurting drivers, companies, and riders. It’s bad for just about everybody outside of the taxi industry.

Its most prominent feature is an abusive $2,000 license fee that drivers would have to pay for the privilege of working in New York City. This would further burden workers who already have issues making ends meet in one of the most expensive cities in the world.

It’s also a blatant money grab, as it would require drivers to renew licenses every year as opposed to the current two or three year renewal period. That’s clearly to make them cough up the money more frequently.

The resolution would also impose “bases”, or limited regions that a driver would be tied to, and where the city would impose caps on the total number of Uber and Lyft cars in the area. Drivers would be forced to stay in one part of the city. That’s bad for them if business is weak in a given time and place. It’s also bad for customers as apps and their drivers cannot react as efficiently to demand.

It somehow gets even worse. Drivers would be limited to working for only one company, further limiting their ability to react to the reality on the ground and do what is best for them to make a living.

If this outrageous proposal became law, New Yorkers should get ready to wait longer, and pay even more for their next Uber or Lyft. It is not the only bad idea on the table, other council members have proposed measures that feature regulations similar to parts of the Diaz plan, while others would regulate driver pay.

These attacks on ride-hailing apps, drivers, and riders are very live threats. Council Speaker Corey Johnson has indicated support for going after ridesharing more aggressively, as has Mayor de Blasio.

However, the major proposal from Councilmember Diaz is so radical, Mayor de Blasio and the chair of the Taxi and Limousine Commission oppose it. So some moderation is likely, but this measure needs to be cut off cold-turkey.

What adds to the tragedy of the taxi and ridesharing fight in New York, is that government has bungled this at every turn. Decades of arbitrary caps the city imposed on taxis crippled the industry when it came time to face some actual competition, and left New Yorkers underserved and desperate for alternatives.

Instead of hitting ridesharing with an expensive and crushing regulatory regime, city politicians should have been protecting both taxis and ride-hailing apps from a recently-passed “congestion surcharge” Albany just imposed on them both.

 

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