Big Government Wants in Your (Spare) Bedroom

It’s very expensive to visit many cities in the United States. New York City is perhaps the most expensive, not only because of the finite space in such a densely populated city, but because of numerous taxes on lodging and regulations like rent control that artificially create lodging shortages.

Nevertheless, there is still high demand to visit cities like New York and the market has found a way to make those visits more affordable. AirBnB is an online service that allows members to stay in people’s spare rooms, apartments, and homes in cities all over the world, often much more cheaply than the average hotel stay in the area.

New York State Attorney General Eric Schneiderman, however, is challenging the entrepreneurial innovation—probably under pressure from special interests who would like the government to stifle their competition. This is crony capitalism as usual. As we’ve seen here in DC, established businesses like brick and mortar restaurants and taxicab drivers use their connections to government to squeeze out competition like food trucks and the Uber personal car service that challenge the status quo.

Cato has long supported free markets, entrepreneurship, and innovations to make goods and services more affordable. Government overreach like General Schneiderman’s campaign punishes not only AirBnB hosts and travelers, but also the New York economy as a whole as fewer people will be able to visit New York. I was on Fox Business last night talking about this protectionist government overreach. You can watch that here: