Uber, Yellow Cabs, and the Role of Government in Growth

By New York City Comptroller Scott M. Stringer

In the last generation, we’ve witnessed the revolutionary power of technology — from digital music and its obliteration of the CD (which had just pushed aside cassette tapes), to telephone landlines that gave way to the cell phone, to smartphones that now double as cameras.

Today, we’re seeing this type of evolution in yet another industry: urban transportation. Uber, Lyft, Via and other “for-hire-vehicle” (FHV) companies have used technology to provide consumers with new choices for how to get around our city.

Some insist that government should step aside and let these disruptive business models proceed without any regulation at all. But government has a duty to ensure that consumers and workers are protected from harm. That means investing in public safety, public health and public infrastructure.

In the context of for-hire vehicles, that also means ensuring that drivers are trained, vehicles are inspected and insured, and consumers are provided with the information they need to make smart choices. The City’s Taxi and Limousine Commission (TLC) has worked diligently and appropriately with the industry to accomplish these goals, so that consumers are equally protected today whether they are hailing a yellow cab or tapping their smartphone for a for-hire ride.

Just as importantly, government must craft regulations that level the playing field for businesses large and small, old and new.

A bill now before the City Council would throw the brakes on the FHV industry while a study of traffic congestion is conducted, an idea that seems to ignore the fact that so many other factors — from economic growth to street design — affect congestion.

Instead of talking past each other about an ill-advised cap, the FHV industry, traditional taxis, and the City should delay any vote on limiting for-hire vehicles and work together to ensure a level playing field and improve working conditions for all drivers. We must take a close look at wage standards in the shared economy, and reexamine the City’s traditional cab drivers and their working conditions, which for decades have been defined by long hours, low wages, and few, if any benefits.

Part of levelling that field should be subjecting FHV’s and taxis to the same fees — including the 50-cent MTA surcharge and 30-cent accessibility surcharge that yellow and green cabs now impose on each ride, because that’s good for everyone.

FHV’s should also provide GPS trip data to the City, just as traditional taxis do, to allow transportation planners to more accurately gauge demand for additional service.

In the end, government must not pick winners and losers by stacking the regulatory deck. Rather, we should lay the foundation for innovation by investing in our infrastructure, and creating a transportation network that works for both drivers and consumers.

Today, the broader tech sector is a burgeoning economic force in New York City, with the number of jobs growing by 56 percent from 2007–2014. These jobs hold the potential to provide onramps to the middle class for thousands of New Yorkers, with average salaries well above the citywide average.

Now is the time for New York City to show the rest of the world how thoughtful government regulation can foster innovative businesses, while also improving the lives of workers, safeguarding the public, and promoting economic opportunity.

Scott M. Stringer is the Comptroller of the City of New York