‘Imagine’, said the cabbie, ‘that Uber had already been operating for twenty years.  And I came along with my black cab.  My product was less comfortable, you had to go out into the street to hail it, and it cost twice as much.  I don’t think I’d get many takers.  My business is finished, guv’, he said.  ‘I’m thinking about what job I do next’.

This is a true story, but an unusual one.  Taxi drivers more often regale passengers with abuse  of the ethnic origins of Uber’s drivers and the American corporations which have invested in that business.  And Transport for London has responded to the cabbies’ concern with the customer friendly suggestion that Uber users should have to wait at least five minutes for their car to arrive.

None of this is new.  A mural hangs on the wall of Manchester Town Hall, depicting my eighteenth-century namesake, John Kay. Kay is wrapped in a bale of cloth to escape detection as angry weavers demolish the flying shuttle he had invented.  The events it depicts are apocryphal, but the truth is, if anything, worse.   While Kay’s invention did provoke civil disturbance, he fled not from angry weavers but from his creditors; his savings had been exhausted in lawsuits over patents. Then as now, patents rewarded attorneys rather than inventors.

The mural probably confuses Kay’s tormentors with the Luddites, who fifty years later did indeed attempt to destroy the machinery which put them out of work.  But they were sternly repressed: Parliament authorised the use of military force and capital penalties to suppress the revolt of the handloom weavers.  The Manchester Town Hall mural is one of a series to celebrate the triumph of economic progress in the nineteenth century – the substitution of machinery for the skilled artisan.

The rise of democracy, perhaps, gave new Luddites an opportunity to use legitimate political means to achieve their ends.  The taxi driver lobby is  powerful and is behind TfL’s proposals to make citizens wait for their Uber.    New York mayor Bill di Blasio won office with substantial financial support from  the cab industry.   Corporate resistance to the internet economy is more powerful still; publishers resist digitisation, hotels protest at competition from Airbnb,  Uber drivers mounted their own protests and forced di Blasio to climb down, but perhaps it will not be long before they are in turn protesting against apps which connect you with cars which have no need of a driver.

These technological changes, even if inevitable, mean real hardship for particular individuals.  The poet Byron made an eloquent speech in Parliament in support of the Luddites, motivated by real concern for men thrown out of skilled work with no alternative means of employment.  In the last two years, the value of a New York taxi medallion has fallen from over $1 million to around $650,000 today.  My London cabbie’s investment in ‘the knowledge’ – the familiarity with London streets required of black cab drivers – had already been outdated by the satnav.  One might have less sympathy for investors in media companies who find the value of their properties  depreciated . nor need many tears be shed for Gene Friedman, the largest owner of New York taxi medallions, or the banks who financed his activities.  These investors  chose a speculation, not a career.

The French government granted John Kay a life pension and made his invention freely available.  In the nineteenth century, a similar French strategy meant Daguerreotype  photography swept the world. The probably superior method of the Englishman, Henry Fox Talbot’s gained only slow acceptance. Stimulating innovation may require public intervention to allow innovation to be freely available, and  to compensate individual losers. But to restrict competition is to damage both the process of innovation and the public interest.

Citation:

http://thefederalist.com/2015/10/26/new-yorks-taxi-king-is-going-down/   Gene Friedman and taxi medallion

http://www.gracesguide.co.uk/John_Kay_(1704-1780)       John Kay

http://www.luddites200.org.uk/LordByronspeech.html           Byron speech

http://www.manchester.gov.uk/townhall/info/8/about_the_town_hall/19/    the_town_hall_murals_by_ford_madox_brown                Manchester mural