Monday, August 18, 2014

George Hilton

George Hilton has died.  Here is the post at the UCLA Economics Department's website.

George contributed "What Did We Give Up With the Big Red Cars?" to a symposium that Ross Eckert and I put together at USC in 1976.  LA did not lose its streetcars, he showed, because of a any corporate conspiracy. The conspiracy story, however, survives. It is just too sweet for some people to give up.

Hilton called attention to the fact that Los Angeles and other modern cities are built for auto use. Adding rail lines will not change that. Many years later, we have found out that George was correct. But we did it the hard way -- by wasting billions of dollars on rail projects.

These crony capitalist projects have almost nothing to do with transportation. Tom Rubin recently reported that the Los Angeles MTA provided 497.2 million transit rides in 1985 but remained stuck at 495.3 million rides in 2014. The LA area had grown considerably in the intervening years. Here is one of Tom's recent studies.

Ross Eckert (also deceased) was George Hilton's student at UCLA. Together, they wrote about "The Jitney's" in 1972. Door-to-door service that might compete with the private auto had been regulated out of existence by you-know-who. But it is now 2014 and the cronies in the taxi industry and city hall have finally met their match. Here is the intro to Gordon Crovitz's column on Silicon Valley's interest in a regulated internet, from this morning's WSJ.
The only thing better for consumers than a disruptive innovator breaking up a monopoly is competition among multiple innovators. The race to upend the taxi industry by providing cheaper, more convenient rides ordered via smartphones is accelerating, leaving regulators in the dust. The challenge led by upstarts Uber and Lyft goes beyond new choices for rides. It's also a reminder that regulators are the enemy of innovation.
The innovators will win but only after much has been lost in time and treasure. Had people only listened to George Hilton in 1976.