Even Small Businesses Need More Regulation Than Private Citizens

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Matt Yglesias agrees that vehicles driving on city streets need to be regulated, but he’s not happy about stringent regulations on low-cost commercial transport options like van-sharing services:

The problem arises not when vehicles are regulated, but when using a vehicle to transport other people for money is regulated much more stringently than using a passenger vehicle in a non-commercial manner. The problem, of course, is that few people can depend on friends and family to drive them around everywhere. So very stringent curbs on commerce in transportation means that people need to overwhelmingly depend on owning their own vehicle and then transporting themselves with it on a non-commercial basis. This is a huge problem for certain classes of people (the vision impaired, the elderly, the poor) and leads to a lot of avoidable traffic congestion and air pollution.

The solution, however, isn’t to somehow stop regulating the practice of driving vehicles. It’s to level the regulatory playing field between a guy driving a friend’s stuff across town in a van to repay a favor and a guy driving five strangers across town in a van in exchange for money he’s going to use to pay the rent.

This deserves some pushback, especially since Matt has previously made similar arguments about the regulation of restaurants and commercial food processing operations. The problem is that commercial operations are just fundamentally different from private ones: they serve a lot more people, thus producing more potential for disaster, and their economic incentives are aligned differently. As a private car owner, I have a fairly obvious incentive to drive safely and to keep my car in decent shape. It’s not a perfect incentive, but at least it’s there. I’d just as soon not kill myself, after all.

But in a commercial operation, I just want to make money. My incentive is to hire the cheapest driver I can find and to skimp on maintenance as much as I can. That’s especially true for small-time operators who don’t have national reputations to worry about and who can just disappear if something disastrous happens. Because of this, the case for stricter regulation of commercial enterprises is pretty obvious.

Matt’s post is a riff on a longer post by Diana Lind, who addresses this tension pretty well:

There needs to be a middle ground between rolling death traps and a transportation system that is killing our economy. New York Sen. Chuck Schumer’s proposal of creating a clearly posted letter-grade system to identify the quality of Chinatown bus services is a great one; this model could be applied to other kinds of new transit providers that serve niche markets. Auctioning off transportation licenses or city-owned property to support infrastructure for alternative transportation modes could be a new source of revenue in other cash-strapped cities.

That sounds roughly right to me. We routinely exempt small businesses from certain kinds of regulations, and there’s no reason why we can’t do something similar here, providing small, low-cost transport operations with the option of following a less rigid set of regulations as long as this is clearly disclosed. But that regulation is still going to be different — and more stringent — than regulation of private vehicles.

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WHO DOESN’T LOVE A POSITIVE STORY—OR TWO?

“Great journalism really does make a difference in this world: it can even save kids.”

That’s what a civil rights lawyer wrote to Julia Lurie, the day after her major investigation into a psychiatric hospital chain that uses foster children as “cash cows” published, letting her know he was using her findings that same day in a hearing to keep a child out of one of the facilities we investigated.

That’s awesome. As is the fact that Julia, who spent a full year reporting this challenging story, promptly heard from a Senate committee that will use her work in their own investigation of Universal Health Services. There’s no doubt her revelations will continue to have a big impact in the months and years to come.

Like another story about Mother Jones’ real-world impact.

This one, a multiyear investigation, published in 2021, exposed conditions in sugar work camps in the Dominican Republic owned by Central Romana—the conglomerate behind brands like C&H and Domino, whose product ends up in our Hershey bars and other sweets. A year ago, the Biden administration banned sugar imports from Central Romana. And just recently, we learned of a previously undisclosed investigation from the Department of Homeland Security, looking into working conditions at Central Romana. How big of a deal is this?

“This could be the first time a corporation would be held criminally liable for forced labor in their own supply chains,” according to a retired special agent we talked to.

Wow.

And it is only because Mother Jones is funded primarily by donations from readers that we can mount ambitious, yearlong—or more—investigations like these two stories that are making waves.

About that: It’s unfathomably hard in the news business right now, and we came up about $28,000 short during our recent fall fundraising campaign. We simply have to make that up soon to avoid falling further behind than can be made up for, or needing to somehow trim $1 million from our budget, like happened last year.

If you can, please support the reporting you get from Mother Jones—that exists to make a difference, not a profit—with a donation of any amount today. We need more donations than normal to come in from this specific blurb to help close our funding gap before it gets any bigger.

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