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wmf

We are now in a "post-Uber" world where regulatory arbitrage is considered just another business strategy.

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You make it sound like it wasn't a standard Business practice before Uber.

Too bad people aren't going to jail for openly flouting regulations. That would probably stop a lot of it.

Assuming that for all regulations the regulator is the good guy you're totally right.

But these days there are people who'd disagree with that assumption.

Then the place to discuss that is in the political arena.

Violating regulations because you think the regulations stink, the regulators are wrong, they shouldn't apply to you, whatever, is wrong.

We probably all agree here that dumping mad pollution into the air is a bad thing, and that regulation should be obeyed, but all it takes is one factory owner deciding that that regulation sucks, and the air's unbreathable again.

Yes, the place to discuss it is in the political arena but whether you can change it in any significant way without the expense of significant resources is questionable. There are many regulations that serve effectively to support a monopoly / oligopoly by installing market entry barriers (Taxi, TelCo, founding a bank). Price controls effectively are regulations that can influence the well-being and survival of many people and in the years after WW2 the Germans were practically forced to break the regulations (against Reich and Allied law) in order to survive. You think they did wrong?

I also think that you (and everyone) should try to follow the laws (laws = regulations and much more) as much as possible as long as you do not believe they are unacceptably unjust. The dilemma between justice and law is itself a recognized part of law philosophy https://en.wikipedia.org/wiki/Radbruch_formula

I fully agree with your last sentence but even here I must ask what regulation is good for if people don't or cannot abide or it's not enforceable?

EDIT: For an excellent example of ambiguity and limits of law and regulations I can strongly recommend: https://en.wikipedia.org/wiki/The_Case_of_the_Speluncean_Exp... (best to read the original article, you can find the PDF in the internetz)

Wrong is a question of morality/ethics, however it most certainly is illegal.

Depends entirely on the effect of the regulations. You could describe the divisive racism laws of the past in USA as regulations, wouldn't it be better to break them anyway? Do no harm, law or not.

Still, if you break a law, you should face consequences, whether you're doing right or wrong. That's the point of civil disobedience - willing to accept the punishment for going with your conscience.

Then there's a difference between breaking the law out for moral reasons and breaking them because they're inconvenient and you could profit more by ignoring them.

About "profit by ignoring them":

- Is food profit?

- When I'm hungry -is food profit?

- When my family is hungry and I don't pay taxes in order to buy food today - is it profit?

- What if I don't pay taxes in order to send my kid to a school?

- What if I don't pay taxes in order to send my kid to a good school?

- What if I collect taxes from people who could otherwise send their kids to school?

There are a million possible definitions of profit and I bet that to each of them I can invent a scenario where it's simply unjust.

And for each of your scenarios I can invent two in which your actions are just parasitic, in which you freeload on your community. It's easier to make a profit when you don't play by the same rules as everyone else. Also, if you run a startup, you're likely not struggling to feed your kids, so the moral picture you're painting does not apply.

Maybe Ripple Labs were engaged in civil disobedience, then?

Or is it impossible for organised groups of people like Ripple and Uber to engage in civil disobedience, in your view?

And since all laws aren't good, people who break laws should not have to ever go to jail. Just fine them instead, regardless of the law, because some laws are bad.

I don't think throwing people in jail accomplishes much of anything. The US has enough control over the banking system to just shut down companies if they misbehave enough, and freeze/reclaim assets if the company was "willfully negligent"

Startups start to run out of things to "disrupt", so they're now starting to disrupt the very fabric of society itself.

What could possibly go wrong.

You mean state, not society.

No, I mean what I wrote. Laws are coordination mechanisms and exist for a reason. Good or bad, they're needed or the community destabilizes as bad actors start to abuse the rest. Not every law is good and while there are mechanisms to realign them with the needs of a community, ignoring the law just because you can get more profit by doing so is not a way to go, it's a fraud and a malicious action towards your community. Doubly so if you're such an asshole about it as Uber is.

Why are bad laws needed? Surely that's the problem. And what mechanisms for "realignment" do you have in mind?

The relevant money transmitter laws in the USA take at minimum several years and millions of dollars to comply with, without any really good reason. The evidence that they achieve anything is minimal (try finding good academic studies of this - it's an exercise in frustration). There is NO way to reform them because the laws are highly open to interpretation, and the regulators who apply them freely admit that they pretty much do whatever they want with applicants:

http://www.americanbanker.com/issues/178_151/how-california-...

US money transmitter laws have created a kind of death spiral where regulators see startups as dangerous (they explicitly say that in the article), make it difficult for them to get licenses, and so the entire market ends up owned by stagnant incumbents. There is then nobody left to lobby for changes to the laws, and big entrenched interests who don't want competition, thus it's impossible to get reform.

its a dangerous position, if people start to find courage from Uber...You don't go to jail for decades for exercising regulatory arbitrage when taking paid rides in your car.

Uber has already been shut down in France, Germany, South Korea, India, Spain, Nevada, South Carolina, Florida, and Kansas. California will require Uber to get commercial insurance, and probably commercial plates, effective July 1. Uber in New York City was forced to comply with NYC's regular taxi and limousine rules. Uber's "we're just a data service" claim did not work for them. They're just another car service now, better organized than most.

But they got to a $40B valuation or whatever.

I see a very similar thing in the Bitcoin world. Build something, ignore all regulations, get VC, get big, then write your own regulations that advantage you relative to "legacy" businesses.

"But they got to a $40B valuation or whatever."

One analyst makes a good argument for a $3.2 billion valuation for Uber.[1]

[1] http://fivethirtyeight.com/features/uber-isnt-worth-17-billi...

"I see a very similar thing in the Bitcoin world. Build something, ignore all regulations, get VC, get big, then write your own regulations that advantage you relative to "legacy" businesses."

Bitcoin business strategies run more to "take the money and run". Running a honest exchange isn't very profitable, because you're in competition with no-fee crooks. Coinbase doesn't charge merchants until they do at least $1M in business, and few merchants have reached that level. NewEgg and Overstock reported that their Bitcoin business was much lower than expected, and have backed off on promoting Bitcoin.

It doesn't sound like Uber is "writing their own regulations" in the above examples...

"Oh look! Archaic municiple rules is attempting to block us! This must mean we are disrupting them, and the fact we have users shows that all these evil municipal rules should be ignored!"

--- AirBnB, Uber, Ripple, etc....

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