Eli Dourado

The most important issue of the 2012 election? TacoCopters

The election is in full swing, and both sides are trying to make it sound like there’s a lot at stake. But the truth is, on many of the issues that divide the country, there are not as many degrees of freedom as politicians claim. The government can’t keep running trillion-dollar deficits forever, so at some point that will stop. There will be some mix of tax increases and spending reductions regardless of who is elected. Many issues have already been decided cumulatively, over the last decade, and merely await congressional or presidential acceptance of reality.

But there are some important and under-appreciated issues that will genuinely be decided in the next four years. Chief among these is that the FAA is scheduled to make its first rules for the commercial use of drone aircraft by September 2015. Under current rules, such use is illegal. But the cost of drone components is plummeting so quickly that widespread use of drones is now an option. As Dan Shapiro notes, “A single high-quality gyro used to go for a thousand bucks.  Now, you can get 3 gyros, 3 accelerometers, and a nice CPU to manage the whole thing for under a sawbuck.”

When most people think of commercial drones, they think of TacoCopter, the fake-but-delicious-sounding taco delivery service. The idea is simple. Download an app, place your order, upload your location, and within minutes, a small unmanned quadrocopter shows up with your tacos. If the FAA makes good rules, such a service is likely to emerge. In fact, thousands of such businesses might even get started. FoodCopter services will be more convenient than food trucks, and more able to withstand local regulatory efforts provided that federal rules are well designed.

Other local delivery services will also suddenly become possible. Farhad Manjoo has written about how Amazon is making a push into same-day delivery. But package-delivering drones greatly reduce the logistical costs of the same-day delivery business, to the point that quite possibly most companies will offer same-day drone drop-off. Drones could change not just the way we shop, but the way our cities develop—we could live more densely, and with narrower streets, if we did not need to drive to the store so much, and if trucks did not need to make deliveries.

The use of commercial drones in long-distance delivery might be even more important. Chris Anderson says that FedEx founder Fred Smith is extremely interested in switching their fleet to unmanned aerial vehicles.

He says that they’d like to switch their fleet to UAVs as soon as possible but that this will have to wait for the FAA, which has a tough road ahead in figuring out the rules of NAS integration. Unmanned cargo freighters have lots of advantages for FedEx: safer, cheaper, and much larger capacity. The ideal form is the “blended wing” (example shown). That design doesn’t make a clear a distinction between wings and body, so almost all the interior of both can be used for cargo. The result is that the price premium for air over sea would fall from 10x to 2X (with all the speed advantages of air).

Reducing the cost of air transport by a factor of five and making it competitive with post-shipping container ocean transport would be an astounding achievement. It would increase the number of mutually-beneficial trades that are possible, which is pretty close to the definition of economic growth. And think also of the fuel savings and environmental gains.

Making air transport competitive with ocean transport would have additional benefits. When I was in Rwanda last year, a number of officials and business leaders that I talked to cited the fact that Rwanda was landlocked as an obstacle to growth. Even though there is little corruption in Rwanda, the corruption in neighboring countries is cutting Rwanda off from trade. As I reported with Rohac and Shah,

A study by the Rwandan Ministry of Trade and Industry reveals that in order to reach the port in Mombasa, Kenya, some 900 miles away from Kigali, a lorry driver needs to pay an average of USD 864 in bribes, and stop at 36 different road blocks and 10 weighbridges. The representative journey used for the study, using a tea shipment of two containers, took over 93 hours to reach the destination.

If the price of air transport fell to only twice the cost of ocean transport, corruption in neighboring countries would not disrupt the flow of goods. Rwanda would have a shot at more exports. Drones are a technology of resistance for Rwanda viz. its neighbors.

But of course, Rwanda is not where drones are going to be further developed, at least not any time soon. A lot of commercial drone development is going to happen—or not happen—in the US in the next several years. And the “not happen” possibility worries me. After all, consider that commercial use of the Internet was unnecessarily delayed for decades:

A handbook on computing at MIT written in 1982 warned students: “It is considered illegal to use the ARPAnet for anything which is not in direct support of government business. . . . Sending electronic mail over the ARPAnet for commercial profit or political purposes is both anti-social and illegal. By sending such messages, you can offend many people, and it is possible to get MIT in serious trouble with the government agencies which manage the ARPAnet.”

This doesn’t have to happen to drones. Instead of delaying the introduction of drones while the FAA writes tons of safety regulations, we should use the existing tort system to enforce safe operation of drones. Regulatory agencies are not well suited to managing highly dynamic sectors of the economy. The tort system, on the other hand, because it addresses cases and controversies after the fact, would be more capable of setting efficient safety guidelines for drone operators. And if we adopted a common law approach rather than a regulatory approach to drone safety, we could have our TacoCopters now, not several years down the road.

To my knowledge, no one has asked the candidates about this important issue. But I hope someone will. The American people deserve to know which one is more committed to opening up urban airspace to commercial use.