Politics

Rubio, touring Uber headquarters, says government regulations hurt innovators

Alex Pappas Political Reporter

WASHINGTON — Republican Sen. Marco Rubio, touring the D.C. headquarters of car service company Uber on Monday, called on local municipalities in Florida to do away with regulations that prevent new businesses like it from operating.

“One of the things that’s holding back innovation in America is regulations,” Rubio said during a press availability that took place in Uber’s new Washington offices, which are still under construction.

Uber allows users to bypass traditional taxis and order drivers of town cars, cabs and other vehicles with the click of a smartphone. No cash is exchanged; rides are billed automatically to the user’s credit card.

The popular service now operates in 33 countries — including in a variety of major cities across the United States, like Washington, New York and Los Angeles.

But some places, including cities in Rubio’s home of Florida, have strict regulations to protect the taxi cab industry that stop Uber from operating.

“Oftentimes,” Rubio said, “innovation is used by established businesses or established industry to keep competitors from ever happening.”

Uber’s East Coast general manager Rachel Holt explained the challenges the company is facing in Rubio’s state.

“In Florida, millions of residents and visitors don’t have access to transportation options,” she said. “The technology to improve Florida’s ecosystem has effectively been outlawed.”

Holt said over the last year, hundreds of thousands of people in Florida have tried to get Uber rides.

“In Orlando, if you call for a town car, and it shows up in five minutes, you legally need to wait 55 minutes just to get in that car,” she said. “In Tampa, if you want to take a ride down the block, it must cost $50. And in Miami, for one business to grow, another one has to shrink, because there’s an artificial cap on the number of sedan medallions that are allowed in the city.”

Holt said the company is working with state legislators in Tallahassee to change these regulations.

Rubio, who teaches a class in Miami at Florida International University, spoke of how his students have been frustrated over the issue. Some, he said, lament how friends can order Uber town cars in D.C but they have a hard time tracking down cabs after a night of going out.

“They wanted to know why that wasn’t possible in Miami,” Rubio said of using Uber. “And I explained to them that’s because of regulations. And not regulations that make any sense. Regulations that are solely being defended for the purpose of protecting an established business model at the expense of competition.”

“And suddenly, I had a bunch of 20- and 21-year-old anti-regulatory activists on my hands,” Rubio said with a laugh.

The event featured drivers that have partnered with Uber. The company’s app puts customers directly in touch with drivers.

“Uber has helped me to make more money, grow our business and improve our lifestyle,” Rana Ahmed of RJ Transit Services said. “It has been a great source of income and been a successful partnership.”

To demonstrate how ridiculous he thinks the regulations are, Rubio used a hypothetical about the video industry.

“Imagine if you owned a video rental place,” he said. “You remember those right? Blockbuster video and places like that. I’m sure they would have loved to have a regulation that said the only way you can buy movies is, after they’re done running in a movie theater, to go to one of these stories and buy or rent a video cassette or DVD. That would have been a great regulation for their business. But imagine if that would have existed, we would have never had Netflix or streaming or any of these other capabilities we have now.”

Rubio argued that regulations are necessary, but not when they are used to protect established practices and stop new innovation.

“We need regulations,” he said. “That’s one of the things government is supposed to do. Regulations exist to protect a consumer from unfair practices. To protect competition. And to protect our safety, to make sure the water you’re drinking, or the car you’re getting into is safe. And that the person driving you, for example, has a drivers license. That’s a regulation. But regulation should never be a way to prevent innovation from happening.”

Holt, the Uber employee, said the company continues to grow. Speaking from an office where ceilings and walls are still being built, she said: “Two years ago, there were three of us in D.C. Here we’re going to have space for 100 people.”

Rubio said the company is “an example of innovation” and said government needs to get out of the way of its progress.

“Regulation should always be used to help the public and ensure safety,” he said. “It should never be used as a tool of anti-competitive activity. We should never allow government power and government regulations to be used to protect an established and incumbent industry at the expense of an innovative competitor.”

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