Why should the incumbents have security in their position, when as you pointed out college kids can do the same work at lower cost? It is unfair to the unemployed and to consumers to provide special protection to incumbents based solely on their position and earlier entry to the market. That is a classic case of rent seeking with governmental protection.

Good for Uber and Lyft for breaking the law and pushing us out of that local minima. Sometimes you have to harm a few privileged rent seekers to remove coercive monopolies and reduce regulatory capture.