Uber’s fate should be left to consumers, not the state

There is a widening divide in the United Kingdom between those who embrace economic freedom and the so-called “gig economy”, and those who are deeply cynical about it. The Labour party, led by Marxists, needs no explanation, while the Conservative party still seems hesitant to make an unapologetic case for capitalism and freedom.

A prime example of the creeping war on business and consumer choice is today’s decision by Transport for London to strip Uber of its licence to operate in the capital.

Putting to one side the irony of TfL lecturing other organisations about being “fit and proper”, the real reason why the Californian firm could lose its license – if its appeal fails – is because it has been a successful disruptor of established interests.

Before Uber came along, black cabs operated within a de facto monopoly. This inevitably led to examples of bad service, high prices and an arrogant attitude when faced with competition. While it is perfectly natural to feel uneasy about having your industry come under threat from a competitor, the answer is to innovate, not stage protests or lobby to get the competition outlawed.

Of course, black cabs may win battles with Uber, but they seemed destined to lose the war. Twenty years ago, the expertise of black cabs was their main selling point – and, yes, cabbies’ knowledge of the streets of London is still impressive. But in an age when you can easily navigate the city with an app, black cabs feel like an analogue antique in a digital age. Taking sentimental values out of the market, not many people – other than perhaps tourists – would choose to pay a substantial premium just to sit in a black cab.

One of the main criticisms that the likes of Uber and Deliveroo face is that they create “insecure” jobs. This is true as far as it goes, but we live in an age where the idea of a “job for life” looks increasingly like a relic from a bygone age. Indeed, its pitfalls don’t come close to outweighing the incredible flexibility for those who choose to work for the company – those who can perhaps only work during nights, or people just looking for a bit of extra cash.

And while Labour mayor Sadiq Khan – who supports TfL’s decision – may not like Uber, Londoners do, with around half the adult population being registered with the app. And many of us are rightly sceptical about TfL’s claims against Uber. Indeed, when it comes to safety, one of the revolutionary benefits of Uber is that you can track your current location and send it to a friend to monitor.

None of the strawman arguments put forward by Uber’s critics should surprise us, however. It is par for the course for statists to put vested interests before individual choice. The Uber case is just another example of them trying to protect the past at the expense of the future – and in so doing they will increase the cost of living for those on modest incomes and snatch away flexible employment from current drivers.

The epitome of this situation is that while you, as a consumer,” may regard Uber as a cost-effective and dynamic invention, statists regard it as dangerous and offensive to established monopolies. You, a jobseeker, may regard Uber as a flexible, self-empowering option in the labour market, they regard it as “insecure” work and – listening to figures like John McDonnell over the years – tantamount to modern slavery. But in September 2017 an independent poll revealed that 80 per cent of Uber drivers would prefer to remain as contractors rather than employees.

The overarching liberal argument against this kind of intervention is that decisions, both social and economic, should be left to the individual. If consumers find a company immoral, they are entitled to vote with their feet. If workers find a company’s terms and conditions substandard, the company won’t attract the workforce it needs.

These basic market mechanisms are a much better way to decide the future of a company than state intervention.

The fact that TfL, with the full backing of City Hall, has taken this decision today reveals an important truth that Milton Friedman picked up on decades ago: “Underlying most arguments against the free market is a lack of belief in freedom itself.”

Written by Jack Powell

Jack Powell is founder and editor of 1828.
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