Uber vs. Washington, D.C.: This Is Insane


[Please see update below.] Here's the headline version of what comes below: As a longtime resident of DC, I am accustomed to misadventures in governance in our "taxation without representation" existence here. But a fight over a new competitor to the District's (often horrible) taxi service offers something I haven't seen in a while. Not routine retail-level corruption, nor skillful top-level favor trading, but instead what appears to be a blatant attempt to legislate favors for one set of interests by hamstringing another. I know, I know, this happens all the time -- but the seeming crudity of this one gets my attention.

For details, see below.
I've used and liked the car service Uber over the last few months in LA, San Francisco, Seattle, and once in Washington DC. In brief: you use a smartphone (iPhone, Android) app to see which of Uber's fleet of roaming town cars is closest to where you are. You send a pickup order; the closest car comes to an address you specify, or automatically to your GPS location; you tell the driver where you'd like to go; and at the end the fare is billed to your credit card. No fumbling for cash, waiting for change, or working out the right tip, which is understood to be included.

In LA and San Francisco Uber seemed slightly but not cripplingly more expensive than a normal taxi. The payoff, from my point of view, was convenience (I don't care if I have the right change, I don't have to sit on endless hold calling a taxi company) and above all certainty. You see how many minutes away the nearest car is, rather than hoping vaguely that the next vehicle around the corner will be an empty cab.

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In DC the gap between Uber fare and regular taxi fare seemed larger, but the convenience gain is greater in this way: In residential DC and its suburbs, cabs don't normally cruise streets off the main avenues. You'd think that phoning for a cab from the main companies -- Yellow, Diamond, Barwood-- would be the answer. Hah! Maybe they'll answer the call, maybe they won't. Once they do, maybe a cab will come, maybe it won't -- and this applies even when you "reserve" a cab, since all that means is that at the assigned time they'll put out a bid to see if anyone is interested. (The exception is the reliable Washington Flyer service, but that's only for trips to Dulles airport, its own occasion for despair.) So if I know that I need a taxi from my house, I have to allow maximum padding time for (a) getting the phone answered and (b) hoping a cab will actually show up. With Uber, by contrast, (a) I don't have to hang indefinitely on the phone, (b) I have faith that the order will go through, and (c) I have a clear idea of just how far away the car is.

But it appears that the DC Council will vote today on a proposal to cripple Uber by ensuring that its minimum fare is five times higher than that for metered taxis, which also rules out a lower-cost hybrid option Uber has just introduced. C'mon!
Here is what showed up in an email to customers from Uber's CEO overnight:

On Independence Day, Uber announced a roll out of a lower cost service that we call UberX. A less expensive Uber option on an all-hybrid fleet. We're pretty excited about it and think it's a great idea for cities across the country. What some of you probably noticed is that there was no roll out of this service in the District. That is because, only days earlier, the DC City Council informed us that they intended to pass an amendment to the taxi modernization bill that would make it illegal for Uber to lower its prices or to offer a low cost service in any form.

More info on Uber's site here, plus accounts from Cnet, Techcrunch, and DCist, all supporting the idea that this is outright strongarm protectionism for an objectively undeserving incumbent industry. And a slightly dissenting account from the WaPo. [And background on Uber and teh general market-failures of the taxi business from Megan McArdle in the magazine.] DC councilors, please don't do this!
Here is language from the legislation being sponsored by Councilmember Mary Cheh, who theoretically represents me:

Addressing Concerns from Uber
  • Services such as Uber would be allowed to operate in the District.
  • Sedans would be required to charge a minimum fare of 5 times the drop rate for taxicabs.
  • Sedans would be required to charge time and distance rates that are greater than those for taxicabs

UPDATE DC Council member Mary Cheh has apparently backed off her bad-idea-to-begin-with measure to require Uber to charge 5x the taxi rate. Good call.