The Next Step in Regulation Madness

So, what is the next danger to the Republic that requires coercive government control to protect us all from disaster?  Pedicabs:

Operating a pedicab used to be cheap and easy. A person could make a buck with little or no overhead and without restrictive, burdensome regulations.

That’s no longer true in some Valley cities that have approved ordinances limiting who can operate pedicabs on their streets. Scottsdale is the latest to tighten its rules, joining Phoenix and Glendale. No other Valley municipality regulates pedicabs.

To continue doing business in Scottsdale, pedicab operators must have a valid Arizona driver’s license, maintain insurance and adhere to regulations pertaining to the safety and visibility of the pedicab. The ordinance, which became law on May 9, includes penalties for non-compliance but does not specify any inspections.

Phoenix’s ordinance, which went into effect in August 2008, was in response to concerns and complaints from downtown stakeholders and patrons regarding pedicab activity, city spokeswoman Sina Matthes said. The ordinance is stricter than Scottsdale’s, requiring Police Department inspections and inspection tags.

Glendale’s ordinance, which became law in late 2007, requires a city-issued license and limits the hours of operation and what roads can be used by operators, said Sgt. Jay O’Neill of the Glendale Police Department.

Why the regulation.  What safety disaster led to this?  Well, apparently some poor pedicab operator allowed himself to be hit by a drunk driver.

Scottsdale’s ordinance was prompted by a Jan. 4 crash involving a suspected drunken driver and a pedicab trailer on Scottsdale Road near Rose Lane. The two pedicab passengers suffered serious head and spine injuries.

Scottsdale police determined that there were no mechanical or safety violations.

Here is some government cluelessness:  it is OK if we rape you as long as we ask for your feedback first

In Scottsdale, operators must maintain at all times a commercial general-liability insurance policy of at least $1 million per occurrence and $2 million annual aggregate.

Jay Ewing Jr., owner and operator of Big Papa Human Powered Transportation, said four people have asked him if he wanted to purchase their equipment because they are going out of business in connection with the Scottsdale regulations. He says a pedicab operator can expect to pay at least $250 a month for insurance....

Scottsdale police Cmdr. Jeff Walther said the transition has gone smoothly because all operators were made aware of the proposed changes and were given the opportunity to provide input before the regulations were approved by the council.

“I was surprised, my folks were surprised, that almost immediately there seemed to be a pretty dramatic decline in operators,” Walther said.


  1. ErikTheRed:

    Eh, in a city (San Diego) where pedicabs infest the downtown streets like lice, I see them more as a "tragedy of the commons" than providing any useful service. I'm been tempted to, on occasion, start a business selling t-shirts that say "No, I don't want a fucking pedicab ride."

  2. Benjamin Cole:

    This is an important post.

    There are many, many business that people could enter without much capital---and nearly all of them are stifled by local government.

    Here in Los Angeles, not only do people want to operate food trucks, they want to step up small food stands, push-carts. They cannot. City regs. They can't even sell hot dogs from their front yards.

    You can't open a speakeasy in your garage, be a prostitute, grow pot, drive a taxi, brew moonshine and sell it, cut hair etc etc etc.

    In fact, nearly anything that a guy could do without much capital is outlawed. Even pedi-cabs!

    (The gag about $2 million insurance is standard to open up a regulated business nearly anywhere, or get a loan of any kind. Lawyers love that one. Every business has $2 million in coverage--fat targets galore!)

    So what does a guy do with $6k in the bank?

    He votes for Obamacare. He can't start a business.

    Can you blame him?

    The sad thing is, we are talking thousands of local governments here. How do you reform thousands of local governments?

  3. randian:

    “I was surprised, my folks were surprised, that almost immediately there seemed to be a pretty dramatic decline in operators,” Walther said.

    You massively raise costs and are surprised when people quit their businesses? This person is an idiot.

  4. chris:

    and a government employee, shock of shocks.

  5. mlhouse:

    Sorry, requiring a business to carry liability insurance is not an onerous requirement and is not "regulation madness". Even the most die hard libertarians must know this because they advocate the utilization of the tort system to make parties "whole" in place of "government regulations". But clearly, if liabiity insurance is not mandated an injured party would very unlikely be able to recoup losses from any damage caused by the negligence of a business.

    Having to put up labels everywhere. Requiring that something be painted red. Nitpicking because a step is 1/16th of an inch to high or too low. Going overboard on handicap accessibility. Forcing licensing requirements that have nothing to do with health and safety and limiting the level of licenses to protect already vested holders. Those are examples of regulation madness. But, legitimate pubic safety and insurance regulations that are enforced against all operators in a free market situation, that is THE LEGITIMATE INTERESTS OF LOCAL GOVERNMENT.

  6. marque2:

    $1 million per occurrence is pretty rough though. In the accident, the drunks insurance should have covered the medical, and the under-insurance would have been covered by the passengers auto insurance policy as well.

    But in a sense I agree, having a valid driver's license, for instance, isn't all that onerous a requirement.

  7. marque2:

    "How do you reform thousands of local governments?"

    One at a time.

    But really it isn't the government, it is the people. People are so terrified of anything anymore that all an official has to do is say it is for safety and then all of a sudden everyone agrees with it. -Or at least they feel they have to agree with it, you look like a cad if you use logic against a law, "designed to keep our kids safe"

  8. marque2:

    You know, I have strolled by Seaport village myself, and the two pedicabs that went by in the several hours I was walking there, didn't seem like a problem to me.

    Of course I don't head there often. I am not all that fond of overpriced ice cream and candy shops to begin with.

  9. jimc5499:

    I have an aircraft mechanics license. A local small airport has been after me for years to do light maintenance and has even offered me free hangar space and utilities. I could easily make between $750 to $1200 a weekend, doing oil and tire changes, light airframe repair and electrical work. The reason that I don't do it is because if I change the oil in a Cessna on a Saturday and the wing falls off on Thursday, I and every other mechanic who's license number is in that log book will be sued. It doesn't matter if that wing falls off five years from now, I'll still be sued. I have no problem with paying for insurance, but, to have to pay for coverage for the rest of my life is crap.

  10. Scott:


    "The question isn't who is going to let me; its who is going to stop me."

  11. Scott:

    I don't see anywhere that the author is arguing that legitimate public safety and insurance regulations that are enforced in a free market situation is against THE LEGITIMATE INTERESTS OF LOCAL GOVERNMENT.

    If i interpret correctly, the point is that regulation that forces entrepreneurs to go out of business destroys the free market. This is regulation madness.

  12. Scott:

    It is my understanding that "Tragedy of the Commons" refers to situations such as these, when no one takes the time or effort to take care of a shared property. For example, think of what an unchecked public bathroom may look like, or how often the printer breaks down in your office because no one take the time to take care of the machine properly, or even a shared living space. The asthetic and functional values of shared properties such as these are likely to decrease over time, or depreciate, at a faster rate than a property that is privately owned.

    I'm having trouble understanding how you think this argument is relative to the pedicabs. You may personally be annoyed at the tragically common occurrence of being offered a fucking pedicabs ride in San Diego, but these pedicabs exist only because the people around you that share your community are using their money to pay for it.

  13. obloodyhell:

    }}} “I was surprised, my folks were surprised, that almost immediately there seemed to be a pretty dramatic decline in operators,” Walther said.

    Captain Renault: I'm shocked, shocked to find that gambling is going on in here!

  14. obloodyhell:

    }}} The sad thing is, we are talking thousands of local governments here. How do you reform thousands of local governments?

    marque2 got it ALMOST right.

    One tar and feathering at a time.

    Ya missed that all-important phrase that would make the process SO much more effective....

  15. obloodyhell:

    }}} Sorry, requiring a business to carry liability insurance is not an onerous requirement and is not "regulation madness".

    How much liability insurance does a regular cabbie have to possess?

    And, without someone ELSE involved -- as in a "drunk driver" -- how does a pedicab alone do 1m damage to anyone?

    The real solution is to require them to make clients AWARE of their lack -- or the total amount of -- of liability insurance, not to require it.

    This is a PRIVATE contractual activity. The government has no business mandating that you do anything but make information such as the amount of liability insurance you have available at any point to the client. Then the client can make an informed decision regarding the wisdom of hiring you for a job.

    And yes, that goes for virtually ALL transactions -- if I hire a quack with no medical degree to do surgery on me, then I get what I deserve -- and NO, the F***ING State IS UNDER NO OBLIGATION OF ANY KIND TO MITIGATE MY INJURIES, so take THAT argument, fold it into lots and lots of sharp corners, and use it as a suppository...

    All this total lack of expectation of responsibility to perform due diligence on the part of individuals does is make people think they don't have to exercise any responsibility whatsoever.

  16. mahtso:

    "Why the regulation. What safety disaster led to this? Well, apparently
    some poor pedicab operator allowed himself to be hit by a drunk driver."

    The linked article does not say this. How do we know that the pedicab was not at fault? Do people think it is wrong to require "regular" taxi cabs to carry liability insurance?

  17. MNHawk:

    "concerns and complaints from downtown stakeholders"

    Ah, yes. The "stakeholders" with concerns they'll be unders, er, for public safety, ya that's the ticket.

  18. mahtso:

    Do you favor banning civil lawsuits? Those suits involve using the state to mitigate injuries.

  19. marque2:

    I am sure someone can come up with a way for a pedicab to cause $1 million in damage. However it is pretty strained. A car can run into a building and do a million damage, but a pedicab wouldn't even break the windows (unless they were mounted really low).

    I am not sure if lowering the amount of insurance would work to ease the burden though, cuz the first 100K of payouts is much more probably most of the rate is based on paying out that 100K.

    I do think folks who take the pedicabs should know to have their own insurance (health insurance and their personal auto liability insurance should cover them) and the reality is that the owner of the automobile that hits them, which is the most likely cause of injury would be responsible for damages as well.

    I really don't see why the cabs should have to buy extra insurance. As for the driver's licence. Yeah I can go along with that. it doesn't cost that much to get, and in AZ anyway, they never expire.

  20. Benjamin Cole:


    It might work to incorporate a business that only does the weekend work. Do the weekend work for five years, then have that corporation declare bankruptcy.


  21. mahtso:

    Strained? Hardly, all that has to happen is that the cab drive into a the path of a car or bus, which could easily lead to all passengers suffering major medical damage.

  22. marque2:

    Highly unlikely. When busses hit motorcycles almost no one notices except for the motorcyclist. In fact if a car hits the back of the bus few on the bus get injured . pedicab is much like a bicycle. Getting hit by the bus would cause zero damage to the bus or occupants. Very silly example

  23. John:

    I just got an idea for a story about 21st century workers buying black market I.D.'s so they can risk working at their profession.

  24. figment:

    the "success" of junk lawsuits with large payouts for people's own stupidity helped us get here.