As a legislative leader I feel one of my most important responsibilities is to ensure a climate exists for Iowa to have a vibrant and expanding economy. Achieving this will not only provide jobs and opportunity to Iowans already here, it will keep our young people from leaving and draw talented people from across the nation to our state. There is no question that in the 21st century this means embracing technology and internet based businesses. And, simply put, there is no better representative of this new era than Uber.
For those unfamiliar with this company and the current debate surrounding them in Iowa, Uber is an American company that operates a transportation service, similar to taxi cabs, that is powered largely by a smart phone app. The service allows a consumer to submit a trip request online, receive a ride from an Uber driver, and be billed digitally. While the company currently operates in Des Moines and Cedar Rapids, they have struggled to expand in Iowa due to differing rules and regulations in various cities—recently culminating with a decision to scrap plans to begin operation in Iowa City.
There are several complicated issues at play ranging from how the cars must be identified to how the drivers are insured. From a legislative standpoint, many of the problems arise from the fact our current regulations are written for taxi cab and limo related services, to which Uber is similar but certainly not the same. On March 24th, by a 95-5 margin, the Iowa House passed a bill that resolves these issues by creating a consistent, statewide set of rules. This action would allow Uber and similar companies to move forward with expansion into new Iowa markets. The bill has been sent to the Senate for consideration and I hope we pass it—here is why.
As a true believer in free markets and competition, the job of government is to create a level playing field for both established industries and innovative startups to compete on. Fairness in this arena is achieved by ensuring rules and regulations do not advantage or disadvantage either party. At the heart of the matter here is the danger of overregulation. While excessive and unnecessary levels of regulation hurt all businesses, small companies and startups in particular are disproportionally affected—they simply do not have the same budgets and administrative abilities to cope.
Though a large portion of our economy will always center around the ancient practice of farming, we also have the opportunity to be on the cutting edge of the internet-driven 21st century economy. I envision this unique mix as the key to prosperity for both rural and urban Iowans of all generations. To make sure this becomes reality we must be as welcoming and encouraging not only to companies like Uber that already exist, but also to the young people who will eventually create the next big innovation.
Creating excessive barriers to market entry through over regulation prevents and diminishes competition—which is the driving force that provides Iowa consumers with more choices and lower prices. As we weigh how to deal with services like Uber, it must be understood that this debate is not necessarily about Uber, but symbolic of many future issues we will face in transitioning to the “new economy” of the 21st century. By embracing intense competition on a level playing field, not only will the best companies, goods, and services win—so will every Iowan.