Paging long-dead French economist Frederic Bastiat.
Uber and other ride-sharing apps are out-competing taxis by offering a better service. And the government doesn’t like that one bit.
Take the state of Massachusetts, which has decided to levy a 5 cent fee on every single trip arranged by a ride-sharing service. That would be annoying on its own, but it gets much worse: the government will take the money generated from the fee and create a sort of bailout or subsidy for the failing taxi industry. Massachusetts is robbing Peter to pay Paul, who also happens to be Peter’s direct competitor.
The irony is not lost on ride-sharing companies.
“I don’t think we should be in the business of subsidizing potential competitors,” said Kirill Evdakov, the chief executive of Fasten, a Boston-area ride-sharing service, according to Reuters.
The fee was signed into law by Gov. Charlie Baker, another Republican politician with a shaky understanding of what constitutes a truly free market.
The state’s “MassDevelopment” agency—a crony-corporatist sinkhole of misappropriated funds, if ever there was one—will be responsible for figuring out how to spend the money to best help the taxi industry. One idea is to help taxis “adopt new technologies,” which probably means using an app to hail a cab. So Massachusetts is robbing Peter to pay Paul so that Paul can learn how to do the thing Peter already does.
Ride-sharing services have little choice but to accept the fee: indeed, they practically have to thank the government for going easy on them. The new law is apparently some sort of compromise—taxi lobbyists wanted Uber banned outright.
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Massachusetts Will Tax Uber to Subsidize Taxi Industry. That’s Absurd. https://t.co/XjLydWAc6g
— Robby Soave (@robbysoave) August 22, 2016
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