The book Why Nations Fail describes the process of how countries either stagnate, devolve, or prosper. The answers, the book claims, lie in a nation’s institutions.
Are political institutions going to allow for democracy and political participation? Or are a few at the top going to dictate everything to their advantage?
Are economic institutions going to allow for new players in the marketplace? Or will they stifle innovation because it threatens their own source of income/power?
Will the institutions of media allow the freedom to speak truth despite it threatening the power/money of powerful interests?
Why Nations Fail addresses this issue on a global scale. But I don’t have to look far to see this same thing happening at a local level. The Twin Cities has two recent examples where it falls on the wrong side of this phenomenon.
A start-up company called Lyft.com recently tried to open up shop in Minneapolis. They are a ride share service that allows a person to request a ride through the Lyft phone application. Drivers also connected to the app receive these requests and respond. Then, in their own car, the driver picks up the person and takes them where they need to go. The drivers and cars are pre-screened for safety by Lyft. When the rider gets dropped off, he pays the driver also through the phone app, and both parties go about their separate ways.
This system makes for a smoother transportation experience. You don’t have to call a taxi service; you get picked up by a trusted driver who welcomes you in their front seat; there are no cash or credit card transactions to deal with. And it has been a hit in half a dozen or so other markets–including Los Angeles, San Francisco, and Seattle–prior to giving Minneapolis a try
However, Lyft also disrupts the business of existing taxi services, and representatives from this industry have been vocal about their disdain for Lyft (and other web-based transportation services). Up until Minneapolis, though, Lyft has been able to operate in the markets they’ve attempted by going to city councils, being up front about their service, and getting approval. In August, Minneapolis denied Lyft’s ability to function in the city. In response to the rejection, Lyft went across the river to St. Paul where they had no regulatory hurdles and currently operates freely there.
Twin Cities media personality Bob Davis had until recently hosted a conservative talk radio show called Davis and Emmer. (“Emmer” is Tom Emmer, former state representative and 2012 gubernatorial candidate.) When the new Vikings stadium was being debated over the summer, the co-hosts decided to have a couple economists on their program who argued that building a stadium has no net positive economic impact on the community.
This was a problem for Davis’s and Emmer’s boss, Clear Channel Communications, owner of several radio and print media outlets locally and nationwide. Davis’s and Emmer’s boss told them not to have the economists on the air. Here are Davis’ words:
“…we were told we couldn’t talk about the Vikings anymore. And we said, ‘Well, what will happen if we do that? Are you going to fire us?’ And [Clean Channel management] said, ‘No, we’ll fire Andrew Lee, your program director. We’ll get rid of him.’ And here’s a guy with kids and everything else.
So for those of you that wondered why we didn’t talk about the Vikings stadium, that’s why. They told us not to. That’s Clear Channel for you.”
You can listen to the whole podcast on Bob Davis’s website where he recently admitted he exchange.
Clear Channel also owns the sports talk radio station KFAN, the “radio home of the Vikings”.
Whether the abusive power of capitalistic institutions or governmental ones, we have in these examples the prevention of growth and truth. Both are snuffed out to the advantage of a few and at the expense of the many. It would benefit the citizens to know the whole truth of an investment their taxes are going toward. It benefits the people to have alternatives for services such as transportation.
Thankfully, there’s a solution. It isn’t in voting in better people–though that can help. Minneapolis just had several city council members who had voted in favor if using $150 million of Minneapolis’s money to fund the Vikings’ stadium get voted out in November. And it isn’t about creating laws to break up monopolistic media control from Clear Channel. The answer is in improving the institutions as a whole by whittling away at their ability to be controlled and manipulated to the benefit of a few. We can change institutions a lot faster than we can change human nature. And as long as there are institutions that allow for such exploitation, people will seek out the ability to exploit to their advantage.
The answer is in technology. Technology allows for free flow of information without the “okay” from a media boss. Thanks to blogs and podcasts, people like Bob Davis can get their word out directly to the people without a media giant censoring their content. Technology allows for people to communicate and interact and build innovative phone apps without the okay of government.
Government in Minneapolis has “won” this time in preventing Lyft from operating, but the fact that other cities have recognized the benefit of Lyft and have resisted the lobbying of special interests–including Minneapolis’s own next-door neighbor, St. Paul–will hopefully influence Minneapolis to adopt to the age of greater inter-citizen connectivity and stop abusing their political power to restrict the advancement of improved services for their residents’ lives. And hopefully next time, the public won’t be shorted the chance to hear the whole truth of an important issue. Technology can strip some of the power from companies like Clear Channel, and people can discover alternative media online.
Until then, the Twin Cities serves up two examples of how political and media institutions can stifle improvement.