John C. Goodman

An investigative report by The Dallas Morning News reveals how far all this has gone. As part of the local campaign against Uber, the police used undercover passengers to try to detect insurance and licensing violations. They discovered none. Then they issued 36 citations, claiming Uber cars were violating local ordinances. Those issues are now in court.

If the police department devoted as much time and ingenuity to the pursuit of common criminals, think how much safer Dallas would be.

That brings us to the public policy question: Why are we regulating automobile transportation services at all?

Did you know that in most cities it's illegal for you to haul your neighbor to work in return for a fee? It's also illegal for you to arrange carpooling services for a fee. Or to take people to the airport. Or to transport people from south Dallas to a job site in north Dallas. Or to bring them back home after work.

The taxi companies claim these regulations protect the public. In an unregulated market, how would we know what the fare is going to be? How would we know if the drivers are properly trained and reliable? How would we know if they have insurance to pay for damages in case of an accident?

It would be comforting to think that the cab companies really have our interests at heart. However, they are lobbying the city government to make us wait at least 30 minutes before we can use an Uber vehicle and they want to ban the use of smartphones. Sorry, that doesn't sound like our welfare is their top priority.

In response to the legitimate concerns the cab companies raise, there are far less intrusive answers. Uber does almost no advertising. Its phenomenal growth has been due to word of mouth endorsement. People who use the service and like it tell their friends and neighbors. Every time a customer rides in an Uber limo, the company's reputation is on the line. It has a self interest in customer satisfaction.

Things are very different in the regulated market. When is the last time you heard the words "wonderful experience" and "Yellow Cab" used in the same sentence? For Uber, the rider is the customer. But for Yellow Cab, the drivers — who pay the company about $1,000 a month, regardless of their income from fares — are the customers. Uber is trying to satisfy you. Yellow Cab is trying to satisfy your driver.

If there is a legitimate role for government in this market, it's certification, not regulation. Let the city government monitor the car services and make public its findings. Publish in the newspaper statistics on traffic accidents, price gouging, customer satisfaction and other pertinent information.

Then let the rest of us make our own choices.


John C. Goodman

John C. Goodman is President of the Goodman Institute and Senior Fellow at The Independent Institute. His books include the widely acclaimed A Better Choice: Healthcare Solutions for America and the award-winning Priceless: Curing the Healthcare Crisis. The Wall Street Journal and National Journal, among other media, have called him the "Father of Health Savings Accounts.”