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Battle To Regulate Ridesharing Moves Through States

New submitter jeffengel writes: The push to regulate services like Uber and Lyft has spread through state legislatures nationwide. At least 15 states have passed ridesharing laws in 2015, joining Colorado, California, and Illinois from last year. More could follow, with bills pending in Massachusetts, Michigan, North Carolina, and others. All this activity has led to new clashes with companies, city leaders, and consumers. Ridesharing bills have stalled or been killed off in Texas, Florida, New Mexico, and Mississippi. Meanwhile, Uber has exited Kansas and is threatening to leave New Jersey and Oregon, while Lyft has ceased operations in Houston, Columbus, and Tacoma. How this plays out could affect the companies' expansion plans, as well as the future of transportation systems worldwide.

27 of 328 comments (clear)

  1. Mixed reaction by JoshuaZ · · Score: 5, Insightful

    I'm not sure how I feel about this. On the one hand, some of these regulations are clear attempts to just protect the taxi industry from new models. On the other hand, some of the regulations (like having some basic insurance to cover if things go wrong) are pretty reasonable. On the gripping hand, both Uber and Lyft are both just blatantly ignoring regulations in many jurisdictions, and whether or not one thinks the laws should be there, it is hard to think that having cheaper car services is such a compellingly necessary service that it can morally or ethically justify ignoring laws.

    1. Re:Mixed reaction by Registered+Coward+v2 · · Score: 5, Insightful

      I'm not sure how I feel about this. On the one hand, some of these regulations are clear attempts to just protect the taxi industry from new models. On the other hand, some of the regulations (like having some basic insurance to cover if things go wrong) are pretty reasonable. On the gripping hand, both Uber and Lyft are both just blatantly ignoring regulations in many jurisdictions, and whether or not one thinks the laws should be there, it is hard to think that having cheaper car services is such a compellingly necessary service that it can morally or ethically justify ignoring laws.

      If you wish to speak of morals and ethics, perhaps you should review the existing structure and their pricing model first.

      There's a reason we have a compelling argument for competition here, and it's not because they have cooler looking cars.

      There certainly is a compelling argument for competition, as there is for proper regulation. So when one looks at the existing structure the question becomes what parts of it need to be applicable to new entrants providing the same service, i.e a ride for hire? Uber et. al. are merely a modification of the existing call a taxi on a phone model and thus should be subject to similar regulatory oversight. You contact a dispatcher, they send an independent contractor to pick you up and take you to a location for a fee. They may not have a medallion on their car and may or may not own the car but the end result is the same - a ride to a location in exchange for money.

      Of course the existing companies are fighting tooth and nail becasue there is a lot of money at stake. In locations where medallions are scarce people can have hundred of thousands of dollars tied up in medallions, the medallion may be the most valuable thing the company or individual owns. Uber threatens that by putting cars on the road, thus threatening to overcome the artificially constrained supply of cabs and make owning a medallion necessary and thus lowering the value of existing medallions. So one can expect the medallion owners, as well as those who lend money to people to buy them, to fight back. Interestingly enough a medallion is one expensive item that is tailored to people with poor or no credit, since as one lender put it "If they don't pay all I have to do is pry the medallion off of the hood. I can then resell it but they can no longer drive so they'll do anything needed to make their payments."

      --
      I'm a consultant - I convert gibberish into cash-flow.
    2. Re: Mixed reaction by Anonymous Coward · · Score: 5, Insightful

      You can drive any car you want, on your property, and you can charge people for rides too.

      Your problem is you aren't rich enough to own your own roads and cities too. Your freedoms were traded for a social contract a very long time ago.

    3. Re:Mixed reaction by Nidi62 · · Score: 4, Insightful

      In the so called "land of the free", I should be able to get a ride from anyone I please as well as give a ride to anyone I please and charge for it if I want to. What is wrong here is not violating the laws, it is the laws themselves that restrict this voluntary mutually agreed upon exchange. If insurance is a big deal, then I as an uber user would only chose to ride with people that have insurance.

      Government has a legitimate interest in monitoring and regulating businesses. And guess what? As soon as you receive money for a service you are operating a business. It is in the public interest that a business is operated and run in a manner that is safe for it's employees, customers, and the greater public and also to ensure that they are not defrauding customers or suppliers/vendors.

      --
      The only thing necessary for evil to triumph is for it to be pitted against a slightly greater evil
    4. Re:Mixed reaction by Anonymous Coward · · Score: 3, Interesting

      Uber is as much ridesharing as ordering pizza using a Pizza Hut app is foodsharing. I think. Not sure if Pizza Hut drivers are independent contractors. Well, anyway...

      I would propose that if any "taxi" driver earns less than $200/month, that they should have looser regulations. I'd also propose that auto insurance should have to cover situations like that (regular auto insurance) provided that no more than $200/month is being earned. This $200/month figure calculated by averaging the previous three month's income derived from being a "taxi".

    5. Re:Mixed reaction by Impy+the+Impiuos+Imp · · Score: 5, Insightful

      As long as the medallion and similar limiting systems continue to exist, all gloves are off as far as I'm concerned.

      There's more to freedom than freedom of speech -- freedom to pursue your own business, and nobody has thr right to restrict entry for the purpose of limiting co.petition. "This here town ain't big enough to support two companies" should be left on the scrap heap of disreputable history.

      --
      (-1: Post disagrees with my already-settled worldview) is not a valid mod option.
    6. Re:Mixed reaction by Anonymous Coward · · Score: 5, Informative

      No, Uber only covers you from the moment the paying rider gets into the car from the moment you leave.
      The time from between you get a ride request to the time you pick up the rider, the vast majority of private auto insurance companies will refuse to cover you. I know my insurance has a clause that stipulated I will not be covered during this timeframe. You are literally driving uninsured during that timeframe. Its a big issue. One of which Uber doesn't want to pay for, your private insurance doesn't want to pay for (because they label you as a business then), and drivers won't want to pay for.

    7. Re:Mixed reaction by Nidi62 · · Score: 4, Insightful

      Yet as a member of the public, I have no interest in this. Why does my opinion that the rights of others matter more than your claim of a so-called "public interest".

      If an Uber driver has been taking stimulants to stay up and drive for 48 hours straight crashes into your car, or hits you trying to cross the street, would you take an interest then? Everyone else certainly does when you are injured so severely you can't work and have to draw disability for the rest of your life and we are paying for it. Things like that happened regularly in industries such as taxis and trucking, with overworked drivers causing fatal accidents. That is why regulations were enacted. They still happen, but they are less frequent and the drivers are severely punished when they do so.

      --
      The only thing necessary for evil to triumph is for it to be pitted against a slightly greater evil
    8. Re:Mixed reaction by plopez · · Score: 3, Insightful

      That looks good on paper but rarely works out in real life. In order for it to work everyone must be honest and a monopoly does not exist. We are a very far way from the idealized small shopkeeper model of Adam Smith. Here are some reasons for government regulation of taxis:

      1) So customers do not get ripped off. Prices are set or at least clearly advertised.

      2) So customers are not raped or murdered. If you hire a ride from Joe Random taxi driver without licensing and a background check you have no assurance about the driver. In fact the lack of assurance could kill the industry as people look for other options.

      3) Insurance. If there is an accident are passengers, occupants of other vehicles, or pedestrian need to be covered if the taxi driver is at fault.

      4) Mechanical safety of the vehicle. Has the Uber and Lyft cars been checked over for dangerous faults or wear and tear? Are the tires good? Etc.

      5) ENSURING competition. If one company gets too big you restrict their licenses while issuing more for their competitors. Sometimes the best way to approach the ideal of a free market is through careful regulation. Free market != unregulated market.

      Those are the ones on of the top of my head. The world is much more complex that Economics 101 or a fictional account of how one writer thinks the world should work. It is even more complex and dynamic that even people with Phds in economics can imagine, IMO. Instead of simplistic solutions we need to look for solutions that actually work.

      --
      putting the 'B' in LGBTQ+
    9. Re:Mixed reaction by dywolf · · Score: 5, Insightful

      youre putting the cart before the horse.

      they aren't regulating Uber to protect taxis.

      they are regulating Uber because it IS a taxi.

      --
      The guy who said the election was rigged won the presidency with the second-most votes.
    10. Re:Mixed reaction by Okian+Warrior · · Score: 4, Insightful

      If an Uber driver has been taking stimulants to stay up and drive for 48 hours straight crashes into your car, or hits you trying to cross the street, would you take an interest then? Everyone else certainly does when you are injured so severely you can't work and have to draw disability for the rest of your life and we are paying for it. Things like that happened regularly in industries such as taxis and trucking, with overworked drivers causing fatal accidents. That is why regulations were enacted. They still happen, but they are less frequent and the drivers are severely punished when they do so.

      I wish we could get away from the "we need regulations, because what if *this* happened!" model of legislation.

      It's a simple appeal to emotion (fear, in this case), it's meant to turn off your rational thought processes and enlist you as a dumb follower.

      A rational argument might analyze not only the possibility of this happening, but also its *likelyhood*.

      Changes should be made not on the basis of probabilities, but from a comparison of risk and reward. Risk is probability times cost. The argument above points out a risk and a value for this risk: Uber and Lyft have been running in gypsy mode for long enough that we should be able to identify the probability of such an occurrence, and actuarial tables should provide us with the cost.

      We can then make a direct comparison of the risk of riding with Uber/Lyft with the risk of riding in a cab, and the cost of an Uber/Lyft ride with the cost of a taxi ride.

      If Uber and Lyft come out having a lower risk-to-benefit ratio than taxicabs, then it makes sense to dump the taxi regulation infrastructure entirely and just let people operate Lyft and Uber services.

      The rationalization of this argument (which is not in any related to the rational argument) is to say that the abuses prior to regulation were due to lack of driver accountability. Regulation reduced the risk by making taxi drivers (and the businesses) accountable for their actions, and it worked well for its time.

      The rationalization might further say that the internet and permanent feedback mechanisms fill this role less expensively than the medallion system. The technology makes a perfectly working system outdated. Buggy whips come to mind.

      If you want to have a rational discussion, let's take municipal income out of the argument (it doesn't bear on the core issue), the private corporate interests out of the argument (they are not remotely impartial), and the employment out of the argument.

      It's a simple case of "market liquidity": Uber and Lyft present a more liquid market with the same benefits as the more expensive system.

    11. Re:Mixed reaction by FranTaylor · · Score: 4, Insightful

      an uber driver who is on his way to pick up a passenger is most certainly on the job

      he started working when he accepted the fare and headed to the pickup point

    12. Re:Mixed reaction by demonlapin · · Score: 3, Informative

      As an aside, I have found that showing a taxi driver your destination on Google Maps on your phone is a very reliable way to insure that they take you via the quickest route. And Uber Black is well worth the small premium for the ride experience if you're not depending on it for day-to-day transportation.

    13. Re:Mixed reaction by AK+Marc · · Score: 3, Insightful

      Ubiquitous and cheap taxis decrease the number of cars on the road. Medallions limiting taxis increase cars, not the other way around. If you can walk out and hail a cheap cab any time of day, anywhere in the city, why would you ever want to own a car?

  2. Ride hailing by Oneflower · · Score: 5, Informative

    There, corrected it for you.

    These businesses have nothing to do with sharing: it's hiring a driver and a car.

  3. Stop calling it that! by Anonymous Coward · · Score: 3, Insightful

    It is NOT ridesharing! Ridesharing is when you share a ride with someone. These are people who are being paid to bring you somewhere, but they don't plan on going there too!

    Ridesharing is perhaps carpooling to work. Or maybe a student hopping a ride with another student in college to go home for break.

  4. Fark those clowns by spywhere · · Score: 4, Interesting

    Licensed, legitimate cab companies run a gauntlet of state & local regulations before they can collect fares. Uber and Lyft bypass them, start operating, and then act surprised when their illegal operation using unlicensed, unvetted drivers run into trouble.

    In most places, the individual drivers and/or the company itself are required to have mercantile licenses... where are theirs?

    1. Re:Fark those clowns by friedmud · · Score: 3, Insightful

      Licensed, legitimate, crab companies also use the high barrier of entry in many places to keep out competitors in order to artificially inflate prices. They lobby like crazy to make sure that things stay the way they have been.

      I think it's interesting that people take this stance against Uber. I thought "we" usually like the upstart guys that are overthrowing established monopolies...

      Don't cry for the cab companies...

  5. "Ridesharing" by American+AC+in+Paris · · Score: 4, Insightful

    If y'all are still telling yourselves that services like Uber and Lyft are "rideshares", you're not paying attention, and haven't been for a long time.

    Ridesharing suggests that people are sharing a ride from point A to point B--that is, they're both going that way, and thus are going to slug together to save gas/cost.

    Uber and Lyft are effectively taxi services that uses an app instead of a dispatcher. The driver seeks out a fare, starts the timer, drives the fare to their destination, and then seeks out another fare.

    The driver is not "sharing" anything, nor is the passenger. This is a taxi service.

    --

    Obliteracy: Words with explosions

    1. Re:"Ridesharing" by Hardhead_7 · · Score: 4, Insightful

      True. These companies are "ridesharing" like hiring a carpenter is "hammersharing."

  6. Schizo by JimSadler · · Score: 3, Informative

    First the state sets up car pool lanes and asks people to share rides in the name of patriotism, monetary benefit and conservation. Then Uber comes along and creates a way to share a ride and the driver benefits a little bit as well. Then the state turns around and say oh no! This is rather like the politics of sex. Sex is sort of ok as long as one hides it away but God help anyone who charges money for sex. Going back to cars these laws have failed to take into account social media. Many people scour social media looking for people who commute to work and make deals to get a ride. I have a friend who goes to college about 100 miles from me. She takes classes three days a week. She slips the drivers $10 per day and she gets dropped off and picked up when they get off work. That is $30. a week for her and that $30. can help the driver pay for gas and enable the car pool lane use as well. And she has three different drivers just in case one is sick or on vacation or has a broken car. I see no moral difference between that and Uber and oddly where I live there is no way to travel county to county that is not massively inconvenient or expensive.

    1. Re:Schizo by asylumx · · Score: 3, Informative

      Yes, I tend to agree with you on this one and am a bit surprised by the anti-ridesharing stance here on slashdot today. That said there is a line between what you described and some of what appears to actually be happening, which is basically self-employed taxi services. In the aviation world we already have a rule that takes care of this problem. With your private pilot's license, you are allowed to carry passengers. Your passengers are allowed to chip in to pay for part of the flight, however the regulation states they can't pay more than their share and also they can't influence the decision to fly nor the plan. That is -- they can ride along and pay for half the gas and they can't tell the pilot where to take them. If you want to carry passengers for a profit, you have to pursue further certification.

      A regulation like this but for automobiles would take care of the problem legally. Then all you have to worry about is enforcement (and IMO that's where it really gets difficult).

  7. Re:This is ridiculous! by American+AC+in+Paris · · Score: 3, Funny

    Forget it, he's on a roll.

    --

    Obliteracy: Words with explosions

  8. Re: Battle to Regulate Free Market by smooth+wombat · · Score: 3, Insightful

    Auctions. They are they ultimate free market. People bid on something up to the point they believe the product is worth. No government interference or price controls.

    --
    We will bankrupt ourselves in the vain search for absolute security. -- Dwight D. Eisenhower
  9. Re:This is ridiculous! by jellomizer · · Score: 4, Interesting

    Well Uber, is a good way for people to create/supplement their income with a relatively low starting cost.

    The problem with today's economy, it is too tough for the average citizen to work to control their income, If they work part time, they get unpredictable hours so they cannot get a second job, If they work full time, they are either salaried or forced to work their hours.

    Our IT infrastructure, has created many good Starter jobs (Mail Room) obsolete, So you will need to be skilled in order to get in.

    I will need to applaud Uber, as its business model, allows for people to work for their money, the harder they work the more they get paid.

    --
    If something is so important that you feel the need to post it on the internet... It probably isn't that important.
  10. Not all bad by friedmud · · Score: 3, Informative

    The summary makes it sound like all of the bills are AGAINST ride sharing... but that's not the case. For instance, in Massachusetts(which is highlighted in the summary) Uber is actively campaigning FOR the regulation bill.

    Why?

    Because the bill states once and for all that ride sharing is a legal activity. Yes, it puts some protections in place: but not much beyond what Uber already provides.

    As someone that uses Uber quite a bit (2-3 times per month) I welcome the new legislation as long as it allows Uber to continue to operate. Regulation is not all bad, as long as it is fair and reasonable.

    1. Re:Not all bad by Nidi62 · · Score: 4, Informative

      The summary makes it sound like all of the bills are AGAINST ride sharing... but that's not the case. For instance, in Massachusetts(which is highlighted in the summary) Uber is actively campaigning FOR the regulation bill.

      Why?

      Because the bill states once and for all that ride sharing is a legal activity. Yes, it puts some protections in place: but not much beyond what Uber already provides.

      As someone that uses Uber quite a bit (2-3 times per month) I welcome the new legislation as long as it allows Uber to continue to operate. Regulation is not all bad, as long as it is fair and reasonable.

      If the driver of a vehicle is not going to the vicinity of your destination whether you are his passenger or not, then it is not ridesharing. It is a paid taxi service or a hired car. If Uber wants to call themselves a rideshare company, then require drivers to register a destination before they can see potential fares, allow them to only take fares going to the same vicinity as their registered destination, and do not allow them to pick up more fares for a new destination (they can drop off a fare along their route and pick up a new one along the same route however) until they have reached their original destination, checked in, and registered a new destination. There: now you are ridesharing.

      --
      The only thing necessary for evil to triumph is for it to be pitted against a slightly greater evil