The sad, embarrassing news came from Indonesia. It was recently reported that one of Gojek drivers, the online motorcycle-taxi (ojek), got harassed by a number of “traditional” ojek drivers. The reason was because Gojek driver took a passenger from the base area of the traditional ojek. The harassments, at least, have happened more than once. I have seen how Gojek drivers were being intimidated with harsh words while crossing the base of traditional ojek drivers during the day and on busy streets.
Many people gave sympathy to Gojek drivers who are getting resistance from traditional ojek drivers. But in my opinion, they only give sympathy without looking at these events as gross violation of human rights and freedom to conduct business and economic activity. Violence against Gojek drivers should be considered equivalent to the persecution of the Ahmadiyya by Islamists, because it concerns the rights to equally get access to basic human rights, which is the freedom. Some people seemed to still tolerate such violence due to “understanding” the traditional ojek drivers that they feel threatened as there are newcomers in the business of motorcycle-taxi services in Jakarta.
If we would like to really understand the case between the traditional ojek and online ojek, they both motorcycle riders who have equal rights and equal access to the economy. Both are protected by the law to conduct economic activity (although ojek have not been included as one of the modes of transport, but the rights of the individuals must be protected by law). Both of them should be able to show their added values, so that customers can choose based on the benefits they could gain. The competition between these two types of motorcycle-taxi is inevitable, if we see it from the perspective of customer benefits.
Business activities can only be developed and increasingly beneficial to customers when they are running in a competitive environment. If there are similar businesses in the same field conducting a perfect competition (which happened without government intervention), then the price offer of commodities will be lower and beneficial to customers. Not only that, the quality of commodities will be increased with the existence of a competition, because the seller will continuously improve the quality of the goods that customers demand. In the contrary, the goods with poor quality and not up-to-date would not survive the market and eventually be abandoned. This is what is called by Joseph Schumpeter as “creative destruction”. Modern civilization is born from creative destruction. The existence of automobile technology eliminates animal-based transport modes. The existence of mobile phones eliminates (slowly) the use of a conventional telephone. It will always be like this, a natural selection of progress.
The problem is, not everyone understands the logic of this kind of competition. Most Indonesians feel sympathetic to the party who gets left behind. Of course this is something saddening. However, the progress itself relates to many people, much larger than the ones who get left behind. When there are people giving their sympathy to the traditional ojek drivers who cannot compete with online ojek drivers, in reality they are giving sympathy to one party and ignoring many other parties: creative ideas from the owners of online ojek, the online ojek drivers, and the customers. Gojek, for example, could bring more ojek drivers closer to their passengers through a simple application downloaded via smartphones, with fixed price on certain definite distance. Meanwhile, traditional ojek fares are often determined arbitrarily without regard to the destination distance. The customers (including people like us who are after affordable price) would feel more comfortable with online ojek. There is no one to blame if the traditional ojek began to be left behind.
Other Embarrassing Things
Absolute economic progress can only be achieved through economic competition. Entrepreneurs do not necessarily want to compete with each other. They tend to go after an absolute power, monopolize certain sectors, and gain benefit by being a “crony” of the government in power. Adam Smith explicitly described it in his magnum opus, “The Wealth of Nations”, that although capitalism and economic competition can bring prosperity through competition among entrepreneurs, there is a disease in a partnership between business and political power that could kill the economic competition itself. Thus, the failure of capitalism in many countries is a failure in maintaining the economic competition.
Then take a look at Indonesia. Anti-competition mentality of Indonesian businessmen can be seen from many associations and entrepreneurs’ association who would like to create cartels in certain business sectors and to put pressure on the government.
The people in Indonesia should emphasize not only the importance of being an entrepreneur to encourage economic growth, but also the importance of competition for entrepreneurs in order to create progress for the wider community. Trainings to be entrepreneurs or start-up training should elaborate that becoming the “crony” businessmen is as bad as becoming corrupt officials. The corrupt entrepreneurs should be exposed to avoid economic crisis during the New Order, which was built on economic cronyism, led to an underdeveloped Indonesia.
The competition mentality is necessary to not only bring a greater progress, but also to eliminate embarrassing things such as what the traditional ojek drivers to online ojek drivers. As a civilized society, we need economic actors that are not embarrassing.
