Uber Congestion Study Backfires for New York City Mayor De Blasio

Published March 24, 2016

A study commissioned in August 2015 by New York City Mayor Bill de Blasio (D) has found increased construction and tourism are mostly responsible for the city’s congested downtown streets.

Uber, a popular transportation network company connecting drivers and riders, has been the target of a campaign by de Blasio and city regulators, who have called for more restrictions on the popular transportation company. De Blasio has claimed Uber is responsible for higher congestion rates in the city’s downtown areas.

De Blasio backed away from proposed restrictions on Uber in August 2015, instead choosing to commission a government study to identify the causes of congestion and traffic jams in the city’s downtown neighborhoods.

Jared Meyer, a fellow at the Manhattan Institute for Policy Research, says de Blasio intended to use the study’s results to blame Uber for the city’s traffic congestion.

“It was clearly disingenuous to blame a new technology for the age-old problem of busy Manhattan streets,” Meyer said. “The mayor received over $500,000 from the taxi industry for his election. He wants to protect taxi medallion owners’ profits, and he placed this priority over the needs of New Yorkers, which squared poorly with his progressive principles.”

Making a Bigger Pie

Meyer says providing more options for consumers is good for everybody, even traditional taxi drivers.

“No one is talking about taking away the monopoly that taxis have on street hails,” Meyer said. “However, the overall pie of for-hire vehicle trips will increase as consumers have more transportation options. Policymakers are now waking up to the reality that it should make taxis more like Ubers, instead of making Ubers more like taxis.”

Michael Farren, a research fellow at the Mercatus Center, says taxicabs and transportation network companies should both be regulated less.

“The best solution for e-dispatch and traditional taxis to coexist is for them to be subject to the same rules and regulations,” Farren said. “When the playing field is equal, companies must compete to differentiate themselves in ways that matter to the consumer, rather than the regulator.”

Farren says government regulations are getting in the way of businesses serving consumers’ needs.

“In general, producers won’t be able to serve customers in the way that the customers would prefer,” Farren said. “The cost of transportation services would be higher than otherwise possible, meaning that some customers won’t be able to use transportation services and some producers may be priced out of the market. As a result, the remaining producers will enjoy a measure of governmentally granted privilege, which provides protection from competition.”

Andy Torbett ([email protected]) writes from Atkinson, Maine.

Internet Info:  

Office of New York City Mayor Bill de Blasio, “For-Hire Vehicle Transportation Study,” January 15, 2016: https://heartland.org/policy-documents/hire-vehicle-transportation-study/