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Manitoba’s Forgotten Cab Consumer – Why Winnipeg Needs UBER

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07Apr

Why Winnipeg Needs UBER:

FACT: By law, Manitoba’s Taxi Board has artificially limited the number of cabs on the road since the 1950s to protect the income of a cartel of cab owners.

FACT: Since that number has barely budged, the number of cabs available per person has actually dropped over time, from roughly 1 cab per 1,000 people in the 1960s to less than 0.65 cabs per 1,000 Winnipeggers today.*

FACT: Even though we’re colder and we’re more spread out, even though our bus system is “at capacity” according to Winnipeg’s Transit director, Winnipeg has fewer cabs on the road per person than any other major city in Canada except Vancouver* – and there’s no sign that’s going to change any time soon.

FACT: Manitobans know there’s too much drunk driving in this province. In a Statistics Canada survey a few years ago, over 7% of residents admitted they’d driven drunk in the previous year. Cold weather and poor access to cabs isn’t an excuse – but it is an explanation, and we could be doing something about the problem if we allowed for faster, more reliable rideshare services.

FACT: When the rideshare company Uber announced its intention to bring its convenient rideshare service to Winnipeg, the taxi cartel pushed the government to protect them – and the province responded by announcing it would do everything it could to stop Uber from putting consumer needs ahead of the taxi cartel’s needs.

***

This matters now because two cities are in the news for living both sides of the tired debate over cab service. One city is taking Manitoba’s approach, while the other is looking to the future instead.

First, take Calgary. Calgary City Council took the tired old path a few days ago when it announced it would delay the release of 57 new cab licenses, despite increased demand. Note that unlike Winnipeg, Calgary had already boosted the number of licenses by 126 in 2014. In virtually the same news cycle, Calgary officials also cracked down on carshare services, even though these services – like Car2Go, ZipCar and Winnipeg’s own Peg City – have been found to reduce demand for cars on the road, cutting congestion and pollution.

Calgary made the same mistake as Manitoba is making today. The logic Calgary used to justify continuing to artificially limit cab supply was simple: they said a recession might be in the wind, due to low oil prices. So, to fight the recession, they’re using the government’s power to protect high fares and artificially maintain the high market value of a cab license to benefit the cab cartel.

This is backward thinking. If a recession is in the wind, shouldn’t we be trying to offer more access and cheaper service to the silent majority of consumers? What about the men and women without special connections, lobbyists and legislated perks – the people who just want to get a ride without having to wait forty minutes for a driver who insists on being paid in cash? What about the underemployed, the working poor or laid-off workers who’ll be under pressure to drive less, buy fewer cars and find cheaper transportation options? What about those who could ride out the recession by making money driving part-time, if only the market would let them?

Next, take New York – a city where supporting flexibility in transit, cycling, carshare and rideshare services are a matter of public policy. Uber is legal there. And the results are clear: earlier this month, we learned that within a couple of years of launching, Uber cars now outnumber New York’s fleet of Yellow Cabs on New York streets.

But as Slate wrote on learning the news, that isn’t necessarily a threat to cabs, since an Uber-registered car and driver are much more likely to be on the road part-time, picking up excess demand in the system.

Manitoba is economically isolated, we haven’t exploited our natural advantages as effectively as our neighbours, and our industrial strength is weakening in the face of competition from the south and west. In response, Mayor Bowman wants Winnipeg to be “the Silicon Valley of the North” – as though there aren’t a dozen other cities already ahead of us in competition for that honour. Opening up room for the industries of the future, now, while others are still resisting – that’s one path to propel Manitoba Forward and grab that title. Being more open to innovative companies like Uber could also help us to solve specific policy problems – like our unconscionably high provincial drunk driving rate.

But neither result is coming to Manitoba any time soon, as long as our governments consistently put the needs of politically connected cartels first, while they put the needs of Manitoba consumers last.

* See “We Have Been Here Before: Supply Management in Transportation,” Conference Board of Canada, 2013.

 

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Dave Shorr
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