Presidential candidate Hillary Clinton doesn’t get it. Obama administration Labor Secretary Thomas Perez doesn’t get it. New York Mayor Bill de Blasio doesn’t seem to get it, either, as he only reluctantly reversed a bad decision on the matter.
In fact, generally, in a somewhat surprising reversal, many so-called Democratic “progressives” want to protect the old ways. But there are exceptions, like Virginia Gov. Terry McAuliffe, who worked with Uber to create a legal framework in his state; Sen. Cory Booker (D-N.J.), who says that hailing a cab has provided some of his most humiliating moments; and Rep. Hakeem Jeffries (D-NY), a Brooklynite who during Uber’s recent showdown with de Blasio said, in essence, “What’s wrong with a little competition?”
On the other hand, Republicans, who are accused occasionally of supporting “crony capitalism,” have embraced the new way and have been eager to let in new businesses to compete. Sen. Marco Rubio of Florida, a Republican presidential hopeful, gets it. One of the chapters in his recent book is titled, “Making America Safe for Uber.”
The new way is the “sharing” or “gig” economy of Uber, Lyft, Airbnb and others. Republican politicians seem more open to embracing these new businesses and new jobs, and the freedom of citizens to contract with each other.
Spurred by unions, powerful bureaucracies, a lack of personal experience, and perhaps a more favorable view of regulation, many Democrats want to ban, restrict, and tax these services.
A politician’s position on Uber is a proxy for how in touch they are with their community. De Blasio obviously had no idea how people move around his city. And Clinton likely hasn’t driven a car in decades. What all politicians should start seeing is why it is both bad policy and bad politics to jump in aggressively and try to ban or heavily burden these services.
It’s bad policy because the transportation services are not just for upper-class urban dwellers. In fact, as a college president recently discovered while moonlighting as an Uber driver, these services are an important alternative for the working poor with limited public transportation options. They also don’t discriminate against minorities, the way many taxi drivers do.
Meanwhile, the home-sharing phenomenon created by Airbnb brings needed cash (and sometimes a cure for loneliness) for homeowners while allowing locales to attract additional visitors.
All this economic activity adds to reportable income and benefits both the public coffers and the economy.
My personal experiences with these services are almost all positive. My brother makes his mortgage payments on his Hawaii home only thanks to Airbnb. (He pays the same local taxes as a hotel.) My family is visiting Manhattan for a few days in August, and by using Airbnb we can have a reasonably priced separate room for the kids. (Try finding a Manhattan two-bedroom hotel room for less than $1,000 a day.)
I travel a lot for business and rely on Uber. I find ride hailing service drivers better. They have clean, smoke-free cars; they don’t talk on the phone while driving; and our rating of each other after the drive ensures we both are courteous and safe. It is simply better than the typical cab experience. Plus, it is great competition.
In July, I took an Uber from Denver to Aspen for $240, less than half the cost of any timely alternative. It was scenic and fun, and I connected with the driver. Compare that to my United Airlines experience for that reverse route months earlier, when I paid double what I paid Uber, plus got hit with $250 in excess-baggage fees and was told a two-day-old policy barred me from checking my bags to another airline. (Thus, I missed my connecting Delta flight.) Yes, Uber was a great substitute for United.
It’s bad politics to oppose these services as they delight millions of average Americans. Moreover, they contribute to the financial well-being of tens of thousands of Americans who rely on them for supplemental income. For 84 percent of Lyft drivers, it’s not a full-time job. Uber likely has similar numbers.
Some “progressives” are uncomfortable and argue that these drivers and homeowners are somehow worse off without government intervention. They want regulation going beyond safety, background screening, and insurance. They want union-like regulation for home-sharing and employee-related regulations and benefits for Uber and Lyft drivers.
Talk about imposing the nanny state on consenting adults. Having taken scores of Uber or Lyft rides, I have yet to meet a driver who says they want the government determining their employment status.
So, if Democratic politicians want to dig in their heels in fealty to unions and unnecessarily burden these services, Republicans can make inroads on many traditional Democratic constituencies. I can’t wait to see the platforms of both parties leading up to their conventions. I predict that Republicans will embrace the sharing economy and that Democrats will try to, but add a lot of ifs, ands, or buts.