In an increasingly competitive world, it is ever more important that our city and our region seize every opportunity to become a more inviting place to work, live, and set up a business. But too often, special interests ally with control-oriented public officials to stifle innovations and protect the modus operandi. Local officials can claim to have protected the consumer, and the special interests can point to the businesses they have “saved,” but less visible damage is done to Saint Louis’ competitiveness, and so many advantages are thrown away. A clear example of this shortsighted policy is Saint Louis’ treatment of ridesharing.
Ridesharing companies like Uber and Lyft are rapidly growing across the country. Their popularity comes from the ability to provide quick, convenient, and inexpensive rides, especially compared with traditional cabs. A study in San Francisco found that more than 90 percent of customers who requested Uber or Lyft had a driver arrive in less than 10 minutes, a huge improvement over traditional cab service. In New York City, the average Uber response time is faster than that of ambulances. Payment is electronic and customers rate drivers, allowing for quality control.
In addition to making it easier to get a lift home, ridesharing may also increase public safety. Ridesharing companies often use peak pricing to ensure the supply of drivers matches demand, no matter the time. The ready availability of drivers makes the safe choice the easy choice for the late-night crowd. Uber claims that incidences of drunk driving have fallen considerably where they operate freely, such as Austin and California.
Normally, Saint Louis officials would be eager to support a new service that increases mobility within the region while potentially creating hundreds of new jobs. In the case of ridesharing, there is no real cost to extending such support other than the political cost of refusing to kowtow to taxicab lobbying. Ridesharing is provided by locals, using resources they already own: personal vehicles. More than 90 percent of metro area households have one vehicle; around 60 percent have two or more. Ridesharing allows Saint Louisans to make better use of these resources by giving rides to other residents and visitors.
For local officials and regulators, ridesharing is a danger to the customer and unfair competition. It’s not safe, they say, despite the fact that large ridesharing companies perform extensive background checks. There’s an insurance problem, they say, despite the fact that Uber and Lyft have extensive insurance policies. Ridesharing companies price gouge, they say, demonstrating their failure to understand how peak pricing ensures that there are always cars available.
In reality, the taxicab industry in Saint Louis has been tightly regulated for decades, often in ways that actively harm, not protect, the customer. The Metropolitan Taxicab Commission, with taxi company owners as members, controls the supply, price, and even dress code of taxi companies in Saint Louis City and County. These regulations effectively block anything but limited, expensive ridesharing options.
Ridesharing companies have the potential to deliver huge benefits to the Saint Louis region, by leveraging the resources residents already own. At the state level, and in other Missouri cities, efforts are under way to remove regulatory barriers to ridesharing. Saint Louisans should encourage these efforts, and support local policy change. They should not let the naysayers, who fear loss of control or heightened competition, deny the region of those benefits.
