Paul Jacob

We’re on the verge of a revolution in mass transit, but city, local and state governments — who in theory are “supposed” to be on the advance guard of progress in this realm — are mostly behind the curve.

The revolution is peer-to-peer (P2P) ride sharing, courtesy of such smart phone apps as Uber and Lyft. The counter-revolution is government.

Politicians like nothing better than to regulate private, for-profit transit (taxis, limo and van services) and, better yet, spend billions and billions of other people’s money to set up elaborate and very inefficient mass transit systems that service only a small fraction of their metro area commuters.

The new P2P services — trendily dubbed “the sharing economy” — allow drivers to pick up passengers and deliver them where they want. The connections and monetary arrangements (payments) are made over the Internet, on the Uber or Lyft services. The process is simple, powerful. People who’ve used it find it far superior to old taxi service: quicker, more convenient, more pleasant, and sometimes (often?) less costly.

The new services are flexible, getting people where they want to go. The old model of taxi service relies on human-centered dispatch, happenstance, and a restricted number of providers.

This last factor, the fact that taxis are regulated in virtually all major cities, and — like licensing schemes everywhere — has as its major effects the reduction of supply, reduction in service, rigidity of adapting to peak flow demands, and increased prices to consumers.

And mass transit is even worse. Bus and light rail lines are rigid, with time schedules and an expensive set stock of cars to haul people around in. These rigidities limit both when and where a commuter is to be picked up. Many commuters are inconvenienced most of the time. It is not uncommon to find commuters stranded after hours, forced to walk long distances, or — defeating the purpose of mass transit in the first place — hire taxis.

The new P2P system accesses the capital people have already sunk into their private automobiles, and allows for great flexibility in response to commuter demand. This is especially the case when Uber has (controversially) raised prices during higher demand periods. The higher prices entice more Uber drivers — people who might usually only pick up riders during their own commutes or errand runs — onto the roads, picking up more passengers.


Paul Jacob

Paul Jacob is President of Citizens in Charge Foundation and Citizens in Charge. His daily Common Sense commentary appears on the Web and via e-mail.