The sharing economy provides for the decentralization and privatization of regulation, but the City of Wichita clings to the old ways.
In May the Wichita Eagle printed a letter from a Wichitan describing his recent cab ride from the airport: “I got in the cab to go home, and that turned out to be the most offensive encounter of my trip. The driver was dressed perfectly for slopping hogs. The cab plainly stank. There were spills, trash, crumbs, scuzzy windows, sticky door panels. Ugh.”
Not having been in a taxicab in Wichita for some years, I was surprised to learn of this person’s experience. There is a law, after all. Section 3.84.140 of the Wichita municipal code provides that “Any vehicle used as a taxicab shall be kept clean, of good appearance … ” Section 3.84.320 mandates that no taxicab driver shall “Fail to maintain their personal appearance by being neat and clean in dress and person.” Also, no driver shall “Fail to keep clothing in good repair, free of rips, tears and stains” or “Operate any taxicab which is not in a clean and/or sanitary condition.”
These laws were implemented in 2012 as a result of former mayor Carl Brewer’s frustration with the complaints he received regarding Wichita taxicabs. The instinct of politicians and bureaucrats is that if there’s a problem, a new or tougher law can provide the solution. The regulations mentioned above are part of the city’s solution, as are mandatory customer service training classes.
But as we learn from May of this year, these regulations aren’t working, according to at least one person whose judgment the Wichita Eagle trusted enough to print.
At the time, the city’s actions in creating tougher regulations had a whiff of plausibility. But right about the time that Wichita implemented new regulations the market for personal rides started to change. That change was the increasing popularity, availability, and refinement of Uber and other similar services. Uber started operations in Wichita in 2014.
What is different about Uber from regular taxicabs? For one, drivers are rated each time they serve a passenger. (Passengers are rated too, by the drivers.)
Which form of regulation do you suppose is most effective? Regulation by government, or regulation by consumers? The letter in the Eagle tells of the failure of government regulation. But no one except that passenger likely knows how bad was the experience of riding in that cab. (Well, that passenger and the driver’s others passengers, probably. A cab doesn’t get that grungy in just a day.)
But a bad Uber trip contributes to a driver’s public reputation. (Bad passengers also develop a reputation that drivers can see.) It’s a powerful system of regulation of each and every time service is provided.
Further evidence of the failure of laws and regulations — or the city’s application and enforcement of them — is that the letter writer begged the city to pass laws that are already on the books: “Wichita, please enact standards for dress, cleanliness and vehicle condition to protect our reputation. Don’t let the impression of the nation’s best airport be sullied by taxicabs.”
Decentralize and privatize
Last week the author Jeffrey Tucker appeared on WichitaLiberty.TV. As we talked about Uber and other services in the sharing economy, I mentioned that this is the decentralization of regulation. Tucker repeated the idea, calling it the privatization of regulation. Both terms apply.
But Wichita’s 2012 taxicab regulations are still the law. As the Wichita Eagle reports, drivers are being trained by bureaucrats. Cabs are still dirty and drivers slovenly. It seems to me that the Wichita regulations are contrary to how Uber operates, leaving the company operating in the shadows, vulnerable to a clampdown at any time. That is something the city needs to change.