In an era where consumers are clamoring for innovative products and cheap alternatives for services, the free market seeks to provide. Time recently wrote an enlightening article highlighting the plight of three companies in particular to compete against crony capitalism. The electric car Tesla has achieved the best safety rating of any car ever tested, while companies like Uber and Airbnb empower customers with the freedom of choice in their various services.
Understandably, consumers are repeatedly choosing these products. However, customers aren’t the ones that have the ear of politicians. Interest groups looking to keep the existing state of affairs intact are using their political ties to ensure their fortune isn’t compromised, even if it means stifling creative products and leaving consumers with fewer options.
Nick Gillespie correctly points out that the current state of the economy creates a dire need for the innovators to win out over the well-connected moguls. How can we stimulate economic growth if the ones propelling us forward are constrained?
Yet the government has sought to do just that. Tesla has been outright banned from operating in New Jersey for daring to cut out the middle man of car dealerships and allowing consumers purchasing power. The Uber app’s revolutionary car service allows both patrons and drivers to rate one another, and is improving services by connecting them in minutes. In San Francisco and New York however, taxi commissioners and city councils are trying to regulate the company out of business. Mandatory criminal-background checks for drivers are in place in California, as well as compulsory driver training programs and mandated “proper” licensing.
When I lived in Washington, D.C., Uber was a godsend when I needed a ride in a pinch. So I was thrilled when attempts to regulate Uber out of existence failed last year. Their plans to specify the types of cars that could carry passengers and what sorts of credit-card processing machines could be used couldn’t stifle the product that many in D.C. were coming to rely on.
Airbnb has also asserted itself as a useful service, providing temporary housing for visitors to the website. Hoteliers and cities hoping to exploit travelers for tourist taxes have tried to stymie the group as much as possible. Even though it operates in 192 countries, some cities charge hosts an annual licensing fee, while others limit the number of participants and ban it in residential neighborhoods.
These shameless displays of power are hurting everyone but the glorified mobsters serving their own corporate interests. Gillespie said it best: “The invisible hand of free markets shouldn’t have to spend so much of its time slapping away the dead hand of political entrepreneurship.” Half the battle of getting a successful business off the ground is just getting the government to step out of your way.
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