The Corner

Airbnb versus San Francisco: The Fight Continues

A few weeks ago, I wrote about how new and innovative tech companies, such as Uber, Lyft, and Airbnb, have struggled against government and special-interest groups trying to regulate them out of existence. For instance, Airbnb allows individuals to rent out their apartments and homes to interested parties (and vice versa), which has the hotel lobby quite angry. As I explained:

With the help of sympathetic lawmakers, Airbnb was banned in Portland. As usual, New York City is a role model for how eager lawmakers are to side with special interests – the city charged a man with a $40,000 fine last year for renting out his apartment with Airbnb. The fine was later lowered by a judge, but it sent a strong signal about whose side the legislature was standing by. Some L.A. neighborhoods have raised heckles about Airbnb, building momentum to bring their case to municipal officials. Across the pond, cities like Paris and Berlin have readied their banhammers for short-term rental services like Airbnb. Smaller cities, like Grand Rapids, Mich., tempered their original impulse to simply ban Airbnb by imposing less restrictive, but still anti-competitive, price regulations on the company. Change is simply proving too big a pill to swallow for many city officials and hotel lobbies.

This week, the fight has taken a turn for the worse in San Francisco: The city is considering a bill that would allow the city to give financial rewards to people who snoop on their neighbors and report whether and how their are hosting people through Airbnb. Here are some details:

One of the initiative’s architects, former planning commissioner Doug Engmann, says that each neighborhood would decide if and how it will permit residents to rent out their homes. The most controversial of the potential provisions, however, would be to financially reward citizens for snitching on their neighbors who violate the law.

“The city’s not enforcing its own law,” Engmann told VentureBeat today. “The private right of action has always been a way in the United States that people can get their laws enforced when their government doesn’t want to enforce their laws.” …

Engmann said pro-Airbnb laws would effectively zone the entire city for short-term rentals, but it should be up to neighborhoods, not individual renters.

“That’s the basis for society; that’s the basis for community. It’s the basis for zoning laws,” he argues….

“Right now, it’s totally unregulated, and the law is being violated,” Engmann said. “I have a real problem with businesses that basically build a revenue model on encouraging their hosts to do illegal activities — that’s basically what Airbnb’s business model is.”

I don’t even know where to start. First, it is stunning for someone who claims to care about “society” and “community” to argue that this kind of snooping will make things better. There’s nothing good that will come out of neighbors spying on neighbors on behalf of the government. Second, the underlying law here either shouldn’t prevent Airbnb’s business or should be repealed. People should be able to do whatever they want with their property, rather than have their neighbors dictating to them what to do with the stuff they own. Zoning laws are unfair and often protecting established homeowners or land owners at the expenses of lower-income people. This case is no different. 

Finally, lawmakers and the officials involved here should read my colleague Adam Thierer’s book, Permissionless Innovation: The Continuing Case for Comprehensive Technological Freedom. If the regulators think that the generation who grew up reading Reddit, using Uber, and dreaming of the incredible potential of 3D printings and commercial drones will forever agree to ask for permission to be creative or reap the benefits of creative innovators, they are mistaken. 

Veronique de Rugy — Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University.

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