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Preparing Government’s Eulogy for Taxi Drivers

The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.

By Yunsoo Lee
October 27, 2020

In 1990, the movie Total Recall piqued the curiosity of many moviegoers, and became one of the masterpieces of sci-fi films. Although the main idea was to inject memories into a brain, one interesting feature was Johnny cab, a taxi driven by a robot. This sci-fi movie is coming remarkably close to the reality. Shanghai, for instance, has launched a self-driving taxi. A driverless car is beginning to acquire a reputation of the next public transportation as the Internet of Thing (IOT) has been pursued at an unparalleled pace. The autonomous vehicles are expected to cut down accidents and energy consumption. The added allure of a self-driving taxi is that passengers would not need to do anything particularly distasteful during the traffic jam.

To a certain extent, the emergence of self-driving taxis is tantamount to the demise of the taxi driver. Sudden changes into autonomous cars will inordinately create difficulties for taxi drivers. Considering several demonstrations against an app-based car-hailing service, it is reasonable to predict that taxi drivers will demonstrate against the self-driving taxi. And it is quite understandable. Both proponents and opponents of self-driving taxis are beginning to call the policies for taxi drivers. What should government do for the near future?

In the face of a self-driving taxi, there are a number of options that government can choose from. The first choice is to simply ban the operation of a driverless taxi. This choice will definitely make taxi drivers and companies happy by maintaining the status quo. However, it will oppose the citizens’ interests because there are various benefits of using a self-driving taxi. It is like a government ban on automobiles to save horsemen. To be sure, exceedingly protecting the existing industry will inhibit innovation. I believe that it is not desirable for the government to ban self-driving taxis.

Second, governments may let any company join the taxi business. In order to foster creative destructions of the taxi industry, government can get rid of any barriers for potential companies to start a taxi business. If this were the case, even electronics manufacturing companies such as Samsung or automotive makers such as Mercedes-Benz would run a taxi service. As a result, taxi drivers as a vocation will go extinct soon and taxi companies will complain of this change because their businesses are at serious risk. This laissez-faire approach will take its toll on taxi drivers and taxi companies. From my perspective, a more lax approach means the lack of government responsibilities because government is the entity of last resort that is committed to protecting vulnerable citizens from a turbulent market.

Alternatively, government can make taxi drivers and companies adapt to the predictable changes. To a large degree, robotaxis will pose a grave threat to the taxi industry’s interests. Government has to offer job training programs for taxi drivers who want to switch their career as the exit strategy. Government should also alter the number of taxi drivers’ licenses by stopping issuing new taxi driver licenses. Once drivers get the license, it is extremely hard to take it away from them. The drivers will taper off during the decades ahead if no new taxi driver licenses are added. Furthermore, government and private companies must move in tandem as government assures companies to prepare for the future. It is better for government to encourage taxi companies to change their business if they want. This will facilitate traditional taxi companies to fade out gradually.

In addition to making the aforementioned decision, government is better at thinking out of the box about how the technological breakthrough changes society, because the bungled transition to autonomous automobiles will create a huge social cost. For instance, even if everything continues to go well, government ought to iron out new privacy and insurance concerns. Moreover, it has to deal with technological convergence and the need to construct electronic infrastructure. Overall, government needs to have a detailed set of rules governing self-driving taxis.

There was a time when citizens rode horses and horse-drawn carriages. At that time, some believed that cars would never replace horses. Soon after the car was introduced, however, there was a dramatic shift to ride in cars in just a few years. For now, many people have not yet become accustomed to the fact that a car can be driven by a machine. A taxi driver will be the modern-day equivalent of a horseman. Perhaps, people born after 2030 will not know the taxi driver. Robo-taxis raise new challenges for government as well. It is time for the government to assist taxi drivers in fading away with dignity.

Author: Yunsoo Lee is an assistant professor at School of Political Science and Public Administration, Shandong University. He holds a PhD in public administration and a master degree in public policy. His main research interests are public management, citizen trust in government, and airport.

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