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I really like Lyft. I use it when I need a taxi and it works very well. Although I do agree that a world where these types of "collaborative consumption" servi

I really like Lyft. I use it when I need a taxi and it works very well. Although I do agree that a world where these types of "collaborative consumption" services (like AirBNB) are essentially unregulated (or at least more open to competition) is much better, it is true that a number of industries are regulated, and incumbents that have been "playing by the rules" were promised a protected business environment. And it's not like they didn't have to give anything up in that trade - a taxi medallion in NYC is worth a lot of money - they have been exchanged for over a million dollars. So the question is: how do we transition to the better world without being unfair to the "stranded capital"?

smsm42 14y ago
We managed to transition from horsepower to cars without economy breaking down and I'm sure some people investing in horses lost some money on that. If some people investing in taxi business being shielded from competition will lose some money - sucks for them, but definite benefit for everybody else. And also would teach people not to invest in schemes that rely on government coercion and anti-competitiveness. It'd be no more "unfair" to them than their rent-extraction based on excluding competition is unfair to consumers.
- tvladeck 14y ago
  I'm not sure I was clear. In the cases I'm discussing, society has made an explicit deal with a group of providers within an industry. Essentially that deal is: purchase a license, run your business this way, charge these prices, etc., and we'll protect your market. NB this does not apply in equal degrees across all industries, and your horses -> cars example doesn't qualify. In addition, note that I was agreeing with you that the transition, on the whole, is definitely desirable. I'm only arguing that there may be moral consequences in not upholding society's end of the trade I describe above.
  - brc 14y ago
    >society has made an explicit deal with a group of providers within an industry. >not upholding society's end of the trade I describe above. The deal - as it was, has been, or whatever, was simply some type of legislative barrier passed using the threat of imprisonment and/or fines as the stick. While you could argue that 'society' passed and agreed to these rules through the democratic legislative process, in reality it's far more arcane than that (don't watch sausages or laws getting made). In reality, no law in a democracy can be promised to exist past the next election period. Sure, mostly it doesn't happen that way, but laws passed some time ago in a different technological state of progress are not inviolate, never-to-be-repealed things cast in stone. There are no moral consequences at all. People win and lose every day, in every industry, for millions of reasons. It would be immoral to try and stop this creative destruction process and try to freeze life at a certain point. Because that would deny the future winners from winning, and permanently cast the losers in the 'loser' role. The underlying beauty and strength of democracy is that it can change and destroy old concepts, old rules and old leaders peacefully. This is the killer feature that makes up for it's otherwise many flaws.
  - Zak 14y ago
    society has made an explicit deal with a group of providers within an industry Government is often a poor proxy for society. I suspect most people in any given US city would not like to artificially limit the supply of taxi drivers and were not consulted about the decision to do so.
    - tvladeck 14y ago
      Well, that's representative democracy for ya. I'm not sure what to say except that I agree with you on the facts, but probably not on their ramifications.
  - deleted 14y ago
    [deleted]
  - smsm42 14y ago
    So? Let's say a corrupt mayor makes a deal with a building contractor - you pay me a million dollars and I'll give you all the building contracts. Then it was discovered and the corrupt mayor went to jail. Is there any reason the society has to keep the building contracts part of the deal? I see none. The only difference in this case is that the corrupt officials that betrayed the public interest in exchange for votes and support of a group of special interests are not in jail yet.
bcoates 14y ago
Give up on the idea of an apolitical, independent bureaucracy and move to the patronage ("spoils") system. The government becomes incapable of credibly promising rents beyond the horizon of the next election and the value of monopoly rights gets priced more appropriately as a wasting asset. You could give existing civil servants tenure both to be fair to them and ensure a gradual transition.
brc 14y ago
>were promised a protected business environment Protecting a business environment always comes at a cost to the consumers, whether it is through tariffs, regulations, licences, restrictions or whatever. I don't feel sorry for the existing businesses, because they constructed a legal framework to protect themselves instead of trying to keep up with the competition. At any point the natural will of people to come up with something better will route around the regulatory framework they hid themselves behind. Incumbents have been playing by the rules all right - rules that they have successfully lobbied for, that protect them at a cost to everyone else. The stranded capital has to remain stranded, and sucks to be them. Otherwise you open a can of worms, and extreme economic stagnation will follow, because doing business becomes a case of who can construct the best regulatory fences, not who can deliver the best products and services. It's not called risk capital for nothing. You risk losing it. TLDR; cry me a river, taxi companies, and next time innovate instead of regulate.

smsm42 14y ago

We managed to transition from horsepower to cars without economy breaking down and I'm sure some people investing in horses lost some money on that. If some people investing in taxi business being shielded from competition will lose some money - sucks for them, but definite benefit for everybody else. And also would teach people not to invest in schemes that rely on government coercion and anti-competitiveness. It'd be no more "unfair" to them than their rent-extraction based on excluding competition is unfair to consumers.

tvladeck 14y ago
I'm not sure I was clear. In the cases I'm discussing, society has made an explicit deal with a group of providers within an industry. Essentially that deal is: purchase a license, run your business this way, charge these prices, etc., and we'll protect your market. NB this does not apply in equal degrees across all industries, and your horses -> cars example doesn't qualify. In addition, note that I was agreeing with you that the transition, on the whole, is definitely desirable. I'm only arguing that there may be moral consequences in not upholding society's end of the trade I describe above.
- brc 14y ago
  >society has made an explicit deal with a group of providers within an industry. >not upholding society's end of the trade I describe above. The deal - as it was, has been, or whatever, was simply some type of legislative barrier passed using the threat of imprisonment and/or fines as the stick. While you could argue that 'society' passed and agreed to these rules through the democratic legislative process, in reality it's far more arcane than that (don't watch sausages or laws getting made). In reality, no law in a democracy can be promised to exist past the next election period. Sure, mostly it doesn't happen that way, but laws passed some time ago in a different technological state of progress are not inviolate, never-to-be-repealed things cast in stone. There are no moral consequences at all. People win and lose every day, in every industry, for millions of reasons. It would be immoral to try and stop this creative destruction process and try to freeze life at a certain point. Because that would deny the future winners from winning, and permanently cast the losers in the 'loser' role. The underlying beauty and strength of democracy is that it can change and destroy old concepts, old rules and old leaders peacefully. This is the killer feature that makes up for it's otherwise many flaws.
- Zak 14y ago
  society has made an explicit deal with a group of providers within an industry Government is often a poor proxy for society. I suspect most people in any given US city would not like to artificially limit the supply of taxi drivers and were not consulted about the decision to do so.
  - tvladeck 14y ago
    Well, that's representative democracy for ya. I'm not sure what to say except that I agree with you on the facts, but probably not on their ramifications.
- deleted 14y ago
  [deleted]
- smsm42 14y ago
  So? Let's say a corrupt mayor makes a deal with a building contractor - you pay me a million dollars and I'll give you all the building contracts. Then it was discovered and the corrupt mayor went to jail. Is there any reason the society has to keep the building contracts part of the deal? I see none. The only difference in this case is that the corrupt officials that betrayed the public interest in exchange for votes and support of a group of special interests are not in jail yet.

bcoates 14y ago

Give up on the idea of an apolitical, independent bureaucracy and move to the patronage ("spoils") system. The government becomes incapable of credibly promising rents beyond the horizon of the next election and the value of monopoly rights gets priced more appropriately as a wasting asset. You could give existing civil servants tenure both to be fair to them and ensure a gradual transition.

brc 14y ago

>were promised a protected business environment Protecting a business environment always comes at a cost to the consumers, whether it is through tariffs, regulations, licences, restrictions or whatever. I don't feel sorry for the existing businesses, because they constructed a legal framework to protect themselves instead of trying to keep up with the competition. At any point the natural will of people to come up with something better will route around the regulatory framework they hid themselves behind. Incumbents have been playing by the rules all right - rules that they have successfully lobbied for, that protect them at a cost to everyone else. The stranded capital has to remain stranded, and sucks to be them. Otherwise you open a can of worms, and extreme economic stagnation will follow, because doing business becomes a case of who can construct the best regulatory fences, not who can deliver the best products and services. It's not called risk capital for nothing. You risk losing it. TLDR; cry me a river, taxi companies, and next time innovate instead of regulate.