My Say: Towards logical consistency — Uber and immigration

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WHEN Jabatan Pengangkutan Jalan (JPJ) announced that it would take legal action against individuals or companies offering taxi-like services with private vehicles, my Facebook feed erupted with comments from friends.

 They decried the action and lambasted JPJ’s decision to place sanctions on Uber, an app that matches people who want rides from one place to another with people who want to offer those rides.

A quick Google search showed many media portals compiling complaints from social media and Uber users that echoed those sentiments. For the most part, arguments against the banning of Uber or private vehicles centre around the superior transport service provided by Uber vis-à-vis other forms of public transport, particularly taxis.

 The most common argument is that if Uber can provide a more affordable, reliable and safe ride from point A to B, why should the government ban it, instead of encouraging Malaysian taxi operators to step up their game and compete?

The argument against Uber tends to boil down to legalities — private cars do not have permits to transport people commercially. Another argument is that while metered taxis have passenger liability insurance, private cars do not. To me, these arguments are unconvincing.

 For the first argument, I can just consider my Uber driver a friend who prefers cash compensation, as opposed to a meal at a restaurant, for doing me a favour by driving me from point A to B. There is little difference between that scenario and a friend buying me a Kentucky Fried Chicken meal as compensation for driving him or her to the airport.

On the second point, I think it really does not matter. If the driver chooses to take that risk, why is it the government’s business to regulate that choice? Furthermore, the incentive is to drive more safely, which is certainly a good thing.

I do not believe the government should regulate Uber whatsoever. If I choose to enter into a transaction for a service in Malaysia with a willing supplier, it should not be the government’s business. If the government wants to ban private drivers, it might aswell ban private music teachers or freelance writers. After all, they provide competition to legally permitted music teachers and writers too, do they not?

It is silly to think that banning a private transport service provided by Uber makes much logical sense, and it is worth acknowledging that the decision is a highly political one — the government wants to appease taxi drivers who may or may not be an important vote bank and who do have some collective action power.

Now, let’s suppose an individual believes that private transport providers, despite not having legal permits, provide a more reliable, less costly and safer means of transport. That individual then chooses to use that private transport at the expense of others such as taxis and, therefore, adversely affects the livelihood of taxi drivers.

The individual is choosing a technically illegal choice because that service is thought to be more beneficial, even if it is at the expense of other more costly providers. Furthermore, that individual is very unlikely to recommend banning that technically illegal service. Rather, he or she is more likely to recommend legalising it.

How is this any different from illegal immigrants from Bangladesh, Burma, Indonesia, Nepal and wherever else working in Malaysia?

In the latter case, employers, particularly low-skilled service providers, may choose immigrant workers because they do a decent enough job and are usually less costly and culturally less averse to menial work. Employing these workers usually means that the employer does not employ Malaysians, who may or may not want to do those jobs in the first place.

 Yet, when it comes to the case of Bangladeshi migrants, for example, we are as a society are quick to pronounce them as a scourge to society. On the other hand, with Uber, we are so eager to welcome disruptive technology. Why are we not as quick to welcome disruptive labour market movements?

I am all for free migration. If a person can move from Kuala Selangor to Kuala Lumpur to look for work, people should be able to move from Dhaka to Kuala Lumpur to look for work as well. If the country in which you were born is entirely arbitrary, then there is no moral ground for the prevention of migration flows. There is also economic literature that argues for greater labour mobility across nations. Aversion to free migration is usually due to political (at the government level) and bigotry (at the individual level) reasons.

 I recognise that “bigotry” is a strong word, but restricting a particular group of people from an activity due to some arbitrary attributes — whether it is race, gender or, in this case, nation of birth — is, by definition, bigoted. The less we label and define individuals by their arbitrary attributes, the less friction the world will have.

In fact, I would argue that the failure to legalise illegal immigrants is even more morally backward than the failure to legalise private individuals to transport passengers for compensation. The former is discrimination based on a person’s arbitrary attributes and the latter is based on a person’s choice. In either case, I argue that restrictions are unjustifiable from a moral perspective. It is from a political perspective that such restrictions gain traction.

Therefore, if we are to be consistent with our principles — notably those supporting Uber — we must acknowledge as well that those same principles should apply to illegal immigrants in Malaysia.

If we are to believe that the type of drivers under Uber should not be restricted, or even possibly legalised, then we must also believe that the illegal Bangladeshis, Burmese and Nepalese who want to work in Malaysia and carve out better lives for themselves — essentially, who only want what our ancestors wanted — should not be restricted in their movements, or even possibly legalised.

Nicholas Khaw is an economist-in-training at Harvard Kennedy School. Prior to this, he was an assistant vice-president at the research division of Khazanah Nasional Bhd.

This article first appeared in The Edge Malaysia Weekly, on November 03 - 09, 2014.