Trumpism in China
By Scott Sumner
Trump’s ideas are increasingly popular around the world. Here’s an example from Shanghai, China, discussing China’s version of Uber:
Didi Chuxing, China’s dominant car-sharing company, is gutting its fleet of drivers in Shanghai to comply with the city’s new regulations restricting car-sharing platforms to the use of local drivers and locally-registered cars.
The removal of drivers and cars from outside the city is Didi’s first major capitulation to regulators after enjoying years of laissez-faire treatment in China.
Less than 3 per cent of Didi’s 410,000 drivers in Shanghai have a local hukou (household registration) that would allow them to continue picking up passengers via the platform, according to the company.
Starting from Saturday, drivers using cars without a Shanghai licence plate will begin being removed from the Didi platform, according to three drivers who received a text message from the company notifying them of the regulatory demands.
This is actually a much bigger deal than banning Uber in America, as the urban Chinese are much more reliant on delivery services:
After the rules of “local cars, local drivers” came into effect in Shanghai last month, Didi initially allowed migrant drivers with out-of-town licence plates to continue using the platform. Many risked fines of up to Rmb50,000 ($7,300) — as much as their annual earnings — to do so.
Migrants from rural China usually drive their own cars registered outside Shanghai. They make up a majority of the urban workforce for car-sharing platforms as well as the delivery services that support the country’s booming e-commerce sector.
Now China’s top cities are cracking down on migrant drivers in order to protect local taxi companies and restrict urban population growth.
The goal is to keep people from the countryside out of the biggest cities. Unfortunately, city residents won’t do this work:
Mr Ren, a manager at a company that rents out Beijing licence plates who wished to remain anonymous because plate rentals are a “grey area”, said that about 20 per cent of his business comes from Didi drivers. Once the new regulations take effect, he estimates that number will drop to zero.
“No local resident would rent a plate to be a Didi driver. It is a tough job, very tiring, and Beijing residents [with Beijing hukou] have much more better choices,” he said.
Similarly, if we deport illegals from America, then Americans would still not be willing to pick fruits and vegetables in the hot sun. Instead, the farmers would stop producing, and we’d buy our fruits and vegetables from Mexico.