New NYC taxis=government at its best?

Fresh off a weekend in New York City--which served as a fantastic reminder of everything I don't miss (and a few things I do miss) about living there--I was somewhat amused to read this story in the New York Times about the fight to replace the Crown Victoria as the crown jewel of the NYC Taxi fleet.

An icon of the urban landscape, the humble yellow cab is set to undergo an unprecedented face-lift — perhaps the biggest change to the city’s street aesthetic since licensed cabs were required to be painted yellow in 1970.

The Bloomberg administration on Monday unveiled three finalists in its competition to replace the current taxis, a mishmash of sedans, minivans and hybrid sport utility vehicles, with a single City Hall-approved model.

By 2014, when the first new vehicles are expected to appear, the city’s taxis will bear more resemblance to the oblong, obsolete Checker cab than the fleet’s current stalwart, the Ford Crown Victoria, which is to be discontinued next year.

All three competing designs, submitted by Ford, Nissan and the Turkish manufacturer Karsan, have the bulky appearance of a minivan. Gone is the cramped legroom of a hybrid car: these interiors feature generously sized backseats and, in Karsan’s case, a rear-facing drop seat to encourage conversation among passengers (that, or motion sickness). 

While I'm not totally sold on the results of the search--why are they all basically minivans, what does this mean for gas mileage, why not go with two models instead of one, etc.--I'm nevertheless intrigued by the process.

In a sense, I think this type of search represents government at its best. In (too) many arenas, we solve problems by creating large government agencies crowded with newly-hired government workers, and inefficiently throw money at the problem (think TSA). The result is often an irreversible structural increase in government spending, with questionable long-term benefits.

This program turns that dynamic on its head. The government puts out a massive incentive (in terms of a government contract), lays out its specifications, and leaves it to the open market to find a suitable answer. This approach is not only more democratic, it also encourages the free flow of capitalism and represents a more efficient use of taxpayer dollars. The costs of research and innovation are privatized (as are the profits), but the general public still benefits. The taxpayer pays nearly nothing for the right to see a better product (or program) put to use by the government.

Incentive-based programs are hardly a new concept, but it's somewhat rare to see the government use it widely (or wisely). Private individuals and organizations have used this approach for decades, with often transformative results--witness the Orteig Prize, which effectively launched the private air industry, and the Progressive Insurance Automotive X Prize, which encouraged the development of a 100-mpg car by providing a substantial cash reward.

To its credit, the Obama administration recognized the potential of these programs (and the power of the collective) by launching Challenge.gov, which provides an interface for existing federal agencies to offer cash rewards for solutions to their problems. A buildout of this type of program to consider a much wider scope would be beneficial to the U.S. government and its taxpayers, while retaining the government oversight that we typically expect and desire.

I think that for our most complex problems, this type of government/private industry hybrid is an absolutely essential tool, especially as we face increasing budgetary constraints at the federal and local level. The government cannot possibly provide the answer to all of our problems (certainly not efficiently), but it can use the power of the collective to provide incredible incentives to the private industry members who are best equipped to solve those problems. Doing so through these types of programs is democracy in motion, and it must be encouraged.


[New York Times]