When Governments Get Left Behind

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April 9, 2017 8:06 AM

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If there is one thing I’m learning coming out of this session at the Indiana Statehouse, is despite making a lot of progress on the fiscal and economic fronts, state government still has a long way to go to catch with the 21st century when it comes to understanding technology and consumers.

What exactly do I mean?

Think about how consumer purchasing habits have changed over the past 20-30 years. If you had to go to the airport and you couldn’t get a lift from a friend or family member, you picked up your landline phone and called a taxi. If you wanted to buy a car, you probably grabbed a copy of the newspaper, looked at the ads and then got that process started. If you were out of town on vacation, you probably stayed at a hotel.

Nowadays, if you want to go from point A to point B, you can use your smartphone app and call an Uber or Lyft. If you want to buy a car, say a Tesla, you can do it all online. And thanks to AirBnB, when I go on vacation I don’t have to get a hotel room, I can stay at someone’s home. And all of this can be done online.

And while we all see these changes as sort of matter of fact, governments seem to be slow to response. In fact, a lot of times government is the problem, not only stifling creativity and innovation but at times it appears that the powers that be are more interested in protecting the powers that exist.

I point to the debates in the Legislature this session over Tesla and AirBnB. Here are two companies that personify change and innovation and instead of being embraced, it’s almost as if someone was trying to put them out of business. Lawmakers wanted to craft a rule that you couldn’t sell a car in Indiana unless there were a middleman, i.e. a dealer. And the rules that were going to be put on AirBnB were so restrictive; you might as well not have bothered.

Now I am not saying that there should not be any rules for companies like Uber and AirBnB. There is something to be said about making sure that someone who is using their personal vehicle for commercial endeavors is properly insured, especially when they’re transporting someone else. And I am sure if you wanted to live next to a hotel, you wouldn’t have bought the house at the end of the cul de sac.

I think there is a happy medium where technology and innovation can properly co-exist with reasonable consumer protections. And as Indiana lawmakers go forward, I hope they always keep that in mind. Because at times, it did appear like lawmakers were more interested in protecting the status quo as opposed to figuring out how to modify the regulatory scheme in such a way that protects consumers and encourages innovation.

Next time we’ll talk about Sunday sales, cold beer, and Indiana’s alcohol laws.

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