Insurance bill would hamstring car-sharing services
Facing pressure from the taxicab industry, Oregon legislators are currently considering a ridesharing insurance bill that would hamstring nascent businesses like Uber and Lyft throughout the state. Political pressure aside, however, the proposed bill underscores just how hard it is for lawmakers to understand the sharing economy at all.
At its root, House Bill 2995 fundamentally misunderstands the distinction between employees, contractors and “on-demand” workers. By seeking to shoehorn on-demand workers into more traditional employment relationships, the Oregon bill threatens to badly distort the insurance offerings available to ridesharing drivers and companies, and to make impossible the viability of ridesharing businesses in the state.
That may be exactly what the taxicab companies want, but it isn’t good for Oregon.
The basic idea behind the sharing economy is to enable individuals with a resource — time, extra housing, a vehicle — to make the unused portions of those resources available to their community, often for a fee below those set by professionals offering similar resources for dedicated use. The economic and social consequences of this innovation are significant: By enabling society to take advantage of these otherwise unused “fractional resources,” both the distribution of, as well as access to, economic opportunity are dramatically expanded.
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