Morris: Airbnb Tests Property Rights

November 13, 2017

by Leo Morris

The road before you diverges into two paths. You cannot go back. You can only forge ahead, choosing one path or the other. Sentinels guard both ways forward.

One sentinel will let you pass only if you either pay a hefty toll or accept suitable punishment for nonpayment. The other sentinel stands aside and says you may pass through and be on your way. Which path will you choose?

Not really that tough a choice, is it?

But some people seem to think it is, or at least want us to think it should be.

Consider the case of Airbnb, one of the newest entries in the “sharing economy” that lets people transact business with one another without the usual government regulatory structure setting the rules and choosing the winners and losers. Airbnb’s vacation rentals are to empty spaces what Uber and Lyft are to drivers and riders. Through the service, people can rent rooms or even whole houses for short periods. It’s a bargain for vacationers and puts extra cash in homeowners’ pockets.

So guess who doesn’t like the service? The existing hospitality industry, of course, which is pushing back against Airbnb as ferociously as the existing taxi industry has challenged Uber and Lyft. And guess who is helping with the fight? City and county governments, of course, which feel compelled to justify their existing regulations by letting no upstart entrepreneurs escape them.

Enter the state, which is considering legislation to prohibit local governments from stopping short-term rentals or trying to bury them under piles of unnecessary rules and regulations. And the possibility of state intervention has some people tied in philosophical knots, including those who populate newspaper editorial boards.

“Call it a clash of political philosophies,” says an entry on one of the state’s proudly progressive editorial pages, “on one side a devotion to the Jeffersonian tenet that ‘the best government is that which governs least’ versus a belief that local decisions are best made by local authorities.”

Oh, no! It’s the dreaded “state control or home rule” conundrum! Whatever shall we do?

Strip away the esoteric theories and abstruse hypotheticals, and what is at stake becomes clear: Whether we resist control or submit to it. This is not really a choice between state dictates and an unknown local decision-making process that could lead to any outcome. The only reason to fight the state’s plan for less control of vacation rentals is to give local governments permission to exercise more control.

Regulators serve the status quo, as columnist and retired pollster Scott Rasmussen has written. “Free-market competition, on the other hand, will encourage innovation and improve the lives of consumers. It’s the best form of regulation. The reason is simple: Consumers will seek out the option that serves their best interest.”

That is truer now than it has ever been. Those who like the idea of being in charge are always looking for ways to ramp up the rules and regulations. They have had no choice — more and more control was needed just for them to keep the power they already had.

But now they’re fighting for their very existence, so expect them to act accordingly. There has always been an underground economy full of buyers and sellers unhappy at being fettered by the heavy hand of authoritarians. Now the digital revolution — more profound than any upheaval this country has ever seen —  is bringing that economy out of the shadows. People today are free to enter into all sorts of voluntary exchanges unencumbered by the command-and-control structures that once stymied them, and they like it.

The statists feel their power slipping away, and they’re going to start getting a little surly. “Home rule” is a good guideline, but it is not an unalterable dictate. We should be careful about what result we will be happy with when the principle is invoked.

There are people who want to control us and those who are willing to let us be, so let’s keep our eye on the ball.

Leo Morris, columnist for The Indiana Policy Review, is a veteran of 40 years in Indiana journalism. As opinion editor of the Fort Wayne News-Sentinel, Morris was named a finalist in editorial writing by the Pulitzer Prize committee. Contact him at leoedits@yahoo.com.



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