The long-running battle between the gig industry and the Big Apple has taken yet another turn. Despite the best efforts of Uber and Lyft to find some sort of compromise and accommodation with the municipal government of New York City, new laws were passed that put a cap on new licenses for ride-hailing vehicles and mandated a minimum hourly wage for drivers. This was done knowing full well that it undercuts the entire concept of ride-sharing services. And now Uber is joining Lyft in taking the city to court over these restrictions. (CNBC)
Uber sued New York City on Friday over the City Council’s vote last August to impose a year-long cap on new licenses for ride-hailing vehicles. Uber’s lawsuit seeks to reverse the cap and allow new licenses again.
New York’s cap was designed to limit the number of vehicles on the road, reducing congestion and helping taxi drivers, who say their livelihoods were hurt by the influx of ride-haling drivers in the city. It also allowed the state of New York to set a minimum hourly rate for drivers, which Uber’s rival Lyft sued to reverse earlier this year.
“Rather than rely on alternatives supported by transportation experts and economists, the City chose to significantly restrict service, growth and competition by the for-hire vehicle industry, which will have a disproportionate impact on residents outside of Manhattan who have long been underserved by yellow taxis and mass transit,” Uber’s lawsuit says.
The New York Taxi Workers Alliances union is behind most of these laws (along with their lobbyists and the taxi company owners. They’re lining up in support of the new laws based on a complaint that Uber and Lyft are harming their business prospects. Their representative cited eight taxi workers who committed suicide in the recent past “because of the crisis Uber created.” And the city government is repeating their claims.
While it’s a tragedy when anyone become depressed enough to turn to suicide, I have a newsflash for the Mayor, the City Council, and these union supporters. No company or particular business model has an inherent right to be free from competition or to have government endorsed insurance against the results of not keeping up with innovation. Sorry if that sounds cold-hearted, but the reality is that ride-sharing outfits are providing massively better service than the cab companies do, generally at comparable or even discounted rates. Most people I know who try Uber once swear off cabs for good.
Just because one industry or a specific set of companies can’t keep up doesn’t mean that their competition should be squashed by the government, no matter how much money those special interests donate to the Democrats who run New York City. The city is passing laws specifically intended to restrict competition and favor their friends and they need to be called out on this in court. The complaints about “traffic congestion” are a red herring and you shouldn’t need a special license to use your own car to offer rides in the first place. Or, if you want to insist they have a chauffer’s license, you shouldn’t be limiting the number of available licenses just to thwart competition and distort the market.