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Op-ed Placement

    The War on Airbnb

    Originally Published in Mises Canada on 8/29/14.

    The web startup Airbnb is finding itself in hot water lately. A peer-to-peer service that matches renters with rentiers, the company is under attack by entrenched lodging businesses such as hotels. It’s easy to see why. The company, which is fairly decentralized, breaks through the thicket of established chains. It matches real people with real people, each seeking to mutually profit from one another. As Jeffrey Tucker writes, Airbnb allows “regular people to cut through stultifying regulations and make better lives for themselves.” It breaks a sacred rule of economics: anything that bypasses the hold of legacy businesses is bound to garner unwanted interference.

    In a confusing column for Bloomberg View, Leonid Bershidsky encourages government regulation of Airbnb for reasons totally unclear. As a resident of Berlin, Bershidsky feels crossed by the startup’s business model. He thinks that local governments give too much leeway to Airbnb hosts, and doesn’t gouge them enough for ransom payments known as taxes. He complains that it’s hard to find liveable, long-term apartments in Berlin because a service like Airbnb emphasizes short-term rentals. He writes: “I’m pleased that Berlin has banned short-time rentals without express permission from the city government.”

    Why so much angst? Apparently, Bershidsky had a tough time finding an apartment in the most populated area of the city. But rather than chalk it up as a fact of condensed living environments, he pins the blame on Airbnb. Since the peer-to-peer network makes it easier to rent out extra rooms or beds, it makes it profitable to do so on a continual basis. People with larger apartments can have a continuous flow of guests fill their space, make some extra cash, and overall assist in the dynamic market process.

    Bershidsky wants none of it. He wants the government to control the process through which people utilize their own property. Airbnb is a nemesis to the stifling nature of the state. Where bureaucrats domineer the playing field under government-supervision, peer-to-peer networks connect people without obtrusion. They slash the cost of doing business by eliminating the middle man. They are empowering, and allow for a more mutually-beneficial economy.