I moved my family to Austin in 2000.
The population since we got here has doubled.
Austin has, for the size of the city, one of the most mediocre transit systems in America.
Traditionally, regulation has been put in place for all the best of intentions.
I’ve been a Council Member since January of 2015.
My concern was getting in and saying, look, let's get some technical solutions to fixing
the traffic congestion.
It's meant to lower prices or offer us more choices or provide higher quality goods or
solve information problems.
But instead the new City Council chose to focus on Uber and Lyft.
When Uber and Lyft first came around, the laws were written for the taxis.
The results of regulating in the transportation field or the lodging field for example has
not been particularly good, and they’ve been the two most ripe sectors for disruption.
I think government definitely has a role.
I think it's state and local governments that really have to think about this.
This newer model had not been envisioned, was not planned for, and so Uber and Lyft
when they began had to operate either in a gray area or in some cases just flagrantly
against the law.
Extra background checks and a city fee; 23,000 Austinites signed an Uber petition against
these proposed regulations for the ridesharing service.
But right now an Austin mobility committee is discussing those proposed policies.
The chairman of the Mobility Committee is a city Council Member by the name of Ann Kitchen.
She came up with an ordinance saying that fingerprinting should be mandated and then
there were some other details, but in essence, it was a question of fingerprinting.
And from the time that she introduced it, she argued that this was a public safety issue.
The fingerprints are an identifier, it’s a biometric identifier, and our public safety
experts tell us that it is the best way to make sure that you’re checking the background
of the person that they’re who they say they are.
The problem here is that Uber has its own proprietary background check process, and
it seems to be working.
We are in many ways much, much, much safer in that environment than we are in a traditional
taxicab.
The Director of Transportation in the city of Austin recommended that the city adopt
the background check that Uber and Lyft employ, and it should be extended across the board
to include Austin taxicabs.
You go down and you hail a cab, it picks you up and drops you off somewhere, nobody knows
when you’ve picked up, when you’ve been dropped off, where you’re going, and if
you ever get there.
Compare that to say Uber.
I’ve done about maybe 250, 275 rides since I’ve started, and I would say a majority
of the time I feel safe.
There’ve been like two instances where I was kind of like, oh what’s going on here
this is what people warned me about.
Um.
Ha.
If you’ve read the regulation you’ll recognize that what they tried to do is they tried to
impose taxi franchise regulations onto rideshare.
It's not just about the fingerprint background checks, it was also a fire extinguisher in
the back of your car.
The danger of applying yesterday's regulations to today's high-speed technologies is that
you could ultimately slow down what are some of the most innovative and pro-consumer innovations
that we know today.
Think of all the amazing things that wouldn’t come to pass if every time something new came
along that disrupted somebody’s job we stopped it.
TNCs are very important part of a ground transportation because they’re an option.
We are not talking about shutting down TNCs.
That is misinformation.
You would think that the regulations are there to protect the consumers, to make your ride,
in fact, pleasant, but really they serve a much different purpose and that is protecting
the existing taxicab companies from continued competition.
Regulation set up this nightmare, and essentially technology has now allowed us to change the
situation by allowing us to do an end run around the old regulatory regime.
I like to call that technological civil disobedience.
The idea that there's no regulation going on in the shared economy just because the
government doesn’t happen to be regulating it is mistaken; there is plenty of regulation
going on.
It's market regulation.
First of all, that is a kind of misnomer.
I mean regulation really should sit with an outside entity that doesn’t have an incentive
in the process.
When you take an Uber ride, for example, you are asked at the end of the ride to rate your
driver on a scale of one to five stars, and if you rate a driver three stars or less,
you will immediately get an email from Uber asking what the problem was.
There’s been studies that found that if you ride in a cab with a person of the same
race or an Uber or a Lyft car with a person of the same race, you are much more likely
to give them a higher rating.
So there’s definitely biases in the rating system and that alone or other similar models
like that aren’t enough to regulate.
Within days, you had a grassroots movement to petition the city to protest the vote.
Uber and Lyft said you know we're not going to tolerate this ordinance, and they went
out and collected 65,000 signatures on a petition to have an alternative ordinance adopted that
would have retained a lot of these regulations but would have eliminated the requirement
of fingerprinting for ridesharing drivers.
Leaving fingerprinting in place for taxi drivers and pedicab driver and other drivers.
Within two weeks, they had blown through the greatest number of signatures for putting
something on the ballot in the history of Austin, and they set the date for the election
in May.
I know that the council deliberately, deliberately framed the ballot language of prop 1 to get
people to vote against it.
Saturday is Austin’s election on the future of ridesharing in Austin, and if the voters
don’t go their way, Lyft and Uber have said they will leave the city.
The rideshare people thought that they had to spend millions of dollars educating people
because the ballot language was faulty.
You couldn’t listen to the radio without listening to pro-Prop 1 ads; you couldn’t
watch TV without pro-Prop 1 ads, full page ads in the newspapers, multiple mail pieces
every day.
So vote for Prop 1.
Keep ridesharing in Austin.
Good luck.
I actually had some of my friends that ended up voting against it because they were so
angry that the amount of money that’s being spent.
They got suspicious.
Somebody’s trying to buy my vote, and they voted against it.
Proposition 1 which would have kept current rules for ridesharing drivers in place failed.
Uber and Lyft are no more in Austin.
They closed up shop in the city this morning.
So our absolute first priority is to help the drivers sign up for other companies and
get that, get that pool going.
The reason they ultimately passed it was because of progressive political ideology, which says
that it’s the government, the federal government, state government, local government, it's government
that is your best chance for safety, for prosperity, for whatever it might be.
Local government should not be in a position of protecting a particular industry or a particular
class of jobs per se.
What they should be in the position of doing is providing a framework for individuals to
compete and provide the best service possible to consumers.
In a well-functioning economy, industries are services that are no longer desired or
no longer producing what people want efficiently they go by the wayside.
We should want that to happen.
And it's giving us more choices, more competition, better prices, and yet we don’t see the
harms that were alleged to be developing if we didn’t regulate it.
Whether it is the Internet, ridesharing, or you name it, people think that there has to
be regulation there or else there will be chaos, and that’s simply not true.
So the profit incentive works fantastic for the majority of consumers, but if you're one
of a small number of minority consumers, let's say, or disabled, there’s not much of a,
of a profit incentive for Uber to go rehaul the entire app unless there’s some kind
of outcry for it or some government pressure or some other kind of other external pressure.
Don’t start with the worst case scenario and try to regulate to solve it.
Instead, see how far self-regulation can take you.
I'm very skeptical of anybody seeking special privileges or exemptions from a regulatory
scheme, and the fingerprinting, in particular, didn’t seem like, somehow, the ride-sharing
should not have to submit to that.
We all do it.
Nurses do it.
Cab drivers do it.
Real estate agents do it.
All of us do it, okay?
We will not allow a company to come in here and say: “We're gonna set the rules for
the city.”
By having the consistent application of rules, whatever they are, to everybody, that if the
rule was a bad rule, if it made no sense, if it was costly, burdensome, then the more
widely that rule is applied, the more likely it is that people would recognize the imprudence
of the rule and repeal it or revise it.
Some say, well, we need to level the playing field by regulating everyone up to be the
same as the old players.
The better solution is to, instead, liberalize down or deregulate down in the direction of
the emerging technologies that are essentially born free as opposed to being born in regulatory
captivity.
Why don’t we offer deregulation to the taxi companies and allow them to respond to market
forces?
It doesn't make sense that you need to change what's not broke.
You don't fix what's broke.
You leave it alone.
But the taxi company said no, no they didn’t want anything to do with deregulation.
They wanted to impose these onerous restriction on to the new rideshare model, knowing that
would hurt their business model more than it hurts the taxis.
The purpose of regulation is not taxicab welfare or hotel welfare; it’s consumer welfare.
I think in the aftermath of the Prop 1 defeat, there’s a lot more regret than there is
crowing about how we beat Uber and Lyft.
We are one of the few cities in the entire country, I should say one of the few major
cities in the entire country, where people do not have access to Uber and Lyft, and I
think that has been clearly to the detriment of the people of Austin.
Austin is growing.
Austin is becoming a bigger and bigger city.
They can't stop that, but it’s like they’re trying to keep Austin small.
Overnight 10,000 people were out of a job because the city and these companies didn’t
get along.
You have Mayor Steve Adler on one side trying to find a solution to bring Uber and Lyft
back into operation in the city of Austin.
On the other side, you have Council Member Ann Kitchen who says that she is not budging
one bit on the rules to get fingerprinted drivers behind the wheel only.
People have just been forced to get used to it.
They’re still unhappy, but my guess is that Uber and Lyft are not gonna come back until
they get what they want.
The fact of the matter is that there are very strong arguments that can be made against
the fingerprinting background check process.
And this is all much ado about nothing.
As we often hear, this is, in fact, the classic solution in search of a problem.
I don’t have any problems with a new industry displacing an older one that just doesn’t
seem to be working, for instance, the taxicab industry.
But at the same time, I also see the need for more regulation, a simple background check
is really not too onerous.
The problem is we've already been down this path and tried that sort of regulatory approach
for other technologies and sectors, and it ultimately led to less competition, less innovation,
less choice, higher prices.
It’s gonna take a big event, maybe a South by Southwest, for Austin to really get angry
about this, and that hasn’t happened yet, but it is a desert.
It is currently a transit desert.