Texas Can't Get Its Innovation Act Together: Fails To Pass Bills To Let Tesla & Uber Provide Service

from the corruption-index dept

Last year, we wrote about two key “corruption indicators” in city and state governments: they ban direct sales models to block Tesla from competing with traditional car companies and they ban Uber/Lyft style car hailing services to protect local taxi incumbents.

It appears that Texas is really trying to wave its anti-innovation flag as strongly as possible as the legislature down there failed to move forward on two key bills that would have made it possible for Tesla to do direct sales in Texas… and to stop local cities from blocking Uber & Lyft to favor taxi incumbents.

A Texas House deadline has come and gone, killing many top-priority bills for both parties ? among them one that would allow Tesla-backed direct car sales and another to regulate ride-hailing companies. Midnight Thursday was the last chance for House bills to win initial, full-chamber approval. Since any proposal can be tacked onto other bills as amendments, no measure is completely dead until the legislative session ends June 1. But even with such resurrections, actually becoming state law now gets far tougher.

And, of course, this comes just after the FTC warned Michigan for its blocking of direct sales of cars like Tesla.

The failure to allow direct sales is a much bigger deal than the car hailing stuff, but both are bad. And the response from Texas politicians is really quite disgusting:

Rep. Senfronia Thompson ? one of the House’s most senior members currently serving her 20th term ? said it was the company’s own fault that the bill didn’t pass.

“I can appreciate Tesla wanting to sell cars, but I think it would have been wiser if Mr. Tesla had sat down with the car dealers first,” she said.

Really? In what world is it considered appropriate to force an innovative company that wants to go direct to consumers to first “sit down” with the gatekeepers that are trying to block them? “I can appreciate Amazon wanting to sell books to people, but I think it would have been wiser if Mr. Amazon had sat down with retail store builders first.” “I can appreciate YouTube wanting to let anyone upload videos, but I think it would have been wiser if Mr. YouTube had sat down with TV producers first.”

That’s not how innovation works. At all. And thus, we can cross Texas off the list of innovative states.

The law around car hailing is not quite as big of a deal, but without the new Texas law, various cities within Texas can still create their own rules that would effectively make it impossible for such services to operate there. There are states that create spaces for innovation — and then there are those that protect incumbents. Texas appears to be making it clear that it’s the latter. If I were a startup in Austin, I might consider finding somewhere else to operate.

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Companies: lyft, tesla, uber

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Comments on “Texas Can't Get Its Innovation Act Together: Fails To Pass Bills To Let Tesla & Uber Provide Service”

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31 Comments
That One Guy (profile) says:

Too good to pass up

“I can appreciate Tesla wanting to sell cars, but I think it would have been wiser if Mr. Tesla had sat down with the car dealers first,” she said.

“I can appreciate Emile Berliner wanting to sell records, but I think it would have been wiser if Mr. Berliner had sat down with the orchestral musicians first,” she said.

“I can appreciate Karl Benz wanting to sell automobiles, but I think it would have been wiser if Mr. Benz had sat down with the horse-drawn buggy makers first,” she said.

“I can appreciate the movie industry wanting to sell films, but I think it would have been wiser if Mr. Movie Maker had sat down with the live theater companies first,” she said.

“I can appreciate Fred W. Wolf wanting to sell refrigerators, but I think it would have been wiser if Mr. Wolf had sat down with the ice sellers first,” she said.

Teslas death ray farts in your general direction says:

Err Innovation?

So Tesla is a car company that sells direct and Uber is a cab company that has creative ways of billing..

I’m not seeing the innovation,ah I had to think I make a cell phone that becomes obsolete every 2 yrs INNOVATION ! love me!

They shouldn’t be blocked from operating but to call either company innovative is massively overstating the reality

PaulT (profile) says:

Re: Re: Err Innovation?

It’s the usual tricks from the ACs around here. If they can’t find a way to support the court’s decision, object to the article or personally attack Mike, they’ll just pretend that the business model under discussion is irrelevant. They used to do this all the time in articles about crowdfunding – once it stopped being a “gimmick” and had demonstrable results, they’d just wave it off as irrelevant because art used to be funded by patrons in the past.

PaulT (profile) says:

“I can appreciate Tesla wanting to sell cars, but I think it would have been wiser if Mr. Tesla had sat down with the car dealers first,” she said.

So, she’s so ignorant of the company that she doesn’t even know that Elon Musk and Nicola Tesla are two different people, one of whom has been dead for 70 years, but believe her she’s an expert on what their business model should be and who they should emulate? Why does that not surprise me?

Anonymous Coward says:

when is the USA gonna realise that 90% of the people elected into various public offices haven’t got the brains of a rockin’ horse? they are not interested in anything other than having a cushy time with fat bank balances achieved by voting to keep the incumbents, not the innovators, in positions of being able to screw the people! instead of continuing to vote these back into office, try voting for someone who has some vision, some foresight, that will hopefully enrich the lives of ordinary people!

Anonymous Coward says:

Re: Jus' 1 queschun f'r yall

As a Texan, who lives in Austin, I will say that this doesn’t seem to have affected the sales of Teslas too much. I see them all over the place, usually at least once a day.

But that’s not to say that this doesn’t make me sick that we can’t get our Reps to pull their heads out of their asses…

Teamchaos (profile) says:

Re: Re: Re:

“government can be a force for good and ill, and we prefer the good.”

We agree on that. I do believe that with most government interference in the marketplace the law of unintended consequences rears it’s ugly head. The road to hell is, after all, paved with good intentions.

http://www.econlib.org/library/Enc/UnintendedConsequences.html

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