Self-driving Ford Fusion hybrid cars.
Self-driving Ford Fusion hybrid cars. (Photo: Jared Wickerham/AP)

Recently I was reminded of the story about “the great horse manure crisis of 1894.” At the turn of the 20th century, there were about 50,000 horses serving as the main form of transportation in the great metropolises of London and New York. Needless to say, the neighing transit line was producing an exorbitant amount of manure daily. The problem reached headlines when the Times newspaper estimated that in 50 years every street of London would be buried under 9 feet of manure. This projection was the catalyst for the first international urban planning conference held in 1898 in New York. Unfortunately, the delegates were unable to agree on a solution. Perhaps more importantly, they were unable to break out of the mindset of a city without horses, and imagine any other alternative. Then, by 1912, the manure problem was long gone.

What solved the crisis was not a change of policy but technological innovation: electrification and the internal-combustion engine provided new, manure-less ways to transport people and goods. And the regulator was only all too happy to embrace these sudden blessings to usher in a new era in transportation.

It was this story that I had in mind when considering some of the challenges regulators face today when trying to predict the future legal regime of autonomous vehicles (AV). In just the last few months, we have been witness to many signs of technological advancement in this field: Tesla declaring its ability to produce a fully autonomous vehicle by 2017; Uber using a broad definition of Pittsburgh’s existing regulatory framework and close cooperation with local authorities in order to turn the city into an experimental ground for autonomous taxis; Otto testing the operation of autonomous trucks, which have the potential to disrupt the entire commercial delivery industry; Google, Baidu, Volvo, and many others, already stepping in and working hard to establish themselves in the industry too.

Unlike other technological advancements, for example, artificial intelligence, Internet of Things, or nanotechnology, the AV industry is locked up in regulation from head to toe. A car, even semi-automated, will not be allowed to drive even one single yard without prior approval of the regulator, not to mention an en masse authorization of fully autonomous vehicles to take the streets. Public safety is the foremost concern and rightfully so. This means that major players’ financial investments and remarkable technological achievements are not enough. To drive the AV industry forward, it is essential to accompany such progress with the creation of the appropriate legal structure that aligns with the new emerging reality.

Looking a decade or two into the future, we are likely to live in a world in which most of the traffic in western countries will be autonomous. Human beings will no longer be drivers. They would eventually lose this battle to computers, which will use machine learning-based algorithms to drive vehicles in the most secure and efficient way possible. This also means that the issue of liability for car accidents will have to be reviewed, paving the way for a new legal regime that holds the manufacturer and other service providers chiefly liable for any damage caused to human well-being or property.

Furthermore, the growing trend of the “sharing economy” and the increase in use of autonomous vehicles could lead to the conceivable end of private ownership of automobiles. The industry could gradually shift away from an individual consumer customer base to corporations running large fleets of vehicles. Essentially, there would be no economic justification for owning a vehicle that is not in use 95 percent of the time (and requires an expensive parking space).

The design of the vehicle itself would also evolve. The notion that there is no human driver in the front seat would likely inspire new innovative designs that would elevate the safety and comfort of the travelers, allowing them to use time spent in transportation for business and pleasure in ways similar to what we see in the shipping and aviation industries.

The issue of infrastructure is equally as important. Vehicles would be able to communicate directly between themselves, with traffic signs, and with the authorities, with no human involvement, calculating the most safe and resourceful method of transportation. Rapid, ongoing and secure communication infrastructure would be essential for the operation of the AV industry. Obviously, cybersecurity concerns would be central.

Judging by the current direction, it is fair to say that the United States is leading the race, both in terms of technological advancements and amendments to existing legislation. For example, the recent U.S. Department of Transportation’s new AV policy provides a significant acceleration forward for state legislators and the AV industry. There are already signs that, with a green light from the Feds, states such as California could speed ahead to regulate driverless cars.

Other countries are also attempting to establish their own leadership in this area. The Israeli Minister of Transportation recently signed an MoU with his U.S. counterpart to invest in developing a new center for research and development of autonomous vehicles in Israel. In a brief to the press, he presented the vision of autonomous vehicles driving on Israeli streets by 2020, thus turning Israel into one of the first countries to allow for the full operation of autonomous vehicles. A special interagency team was compiled to discuss the need for a new regulatory framework to be established in time for the arrival of the first autonomous car to be cruising down the Israeli freeway.

Singapore has also launched the first operational taxi service run by NuTonomy, an autonomous vehicle software startup. Singaporean good weather, great infrastructure, obedient drivers and the geographical characteristic of being a land-locked island have turned it into an ideal laboratory for the introduction of AV.

Devising a new regulation for emerging technologies is an art form. Knowing the law and its reasoning is vital, but not enough. As the great horse manure crisis of 1894 has shown us, it isn’t enough just to get policymakers together in a room, but for them to have the crucial capacity to envision an entirely new set of rules once they get there. Regulators need to be able to imagine a detailed vision of the future in order to construct a legal regime which provides adequate solutions to a reality that has yet to mature. The uncharted future often leads to short-sightedness, which in turns creates a tendency to deal with immediate and minute problems, instead of focusing on the bigger picture. There is no doubt today that the autonomous vehicles industry is facing gigantic challenges that demand creative and robust legal thinking, not meaningless muddling in manure.

Recently I was reminded of the story about “the great horse manure crisis of 1894.” At the turn of the 20th century, there were about 50,000 horses serving as the main form of transportation in the great metropolises of London and New York . Needless to say, the neighing transit line was producing an exorbitant amount of manure daily. The problem reached headlines when the Times newspaper estimated that in 50 years every street of London would be buried under 9 feet of manure. This projection was the catalyst for the first international urban planning conference held in 1898 in New York . Unfortunately, the delegates were unable to agree on a solution. Perhaps more importantly, they were unable to break out of the mindset of a city without horses, and imagine any other alternative. Then, by 1912, the manure problem was long gone.

What solved the crisis was not a change of policy but technological innovation: electrification and the internal-combustion engine provided new, manure-less ways to transport people and goods. And the regulator was only all too happy to embrace these sudden blessings to usher in a new era in transportation.

It was this story that I had in mind when considering some of the challenges regulators face today when trying to predict the future legal regime of autonomous vehicles (AV). In just the last few months, we have been witness to many signs of technological advancement in this field: Tesla declaring its ability to produce a fully autonomous vehicle by 2017; Uber using a broad definition of Pittsburgh’s existing regulatory framework and close cooperation with local authorities in order to turn the city into an experimental ground for autonomous taxis; Otto testing the operation of autonomous trucks, which have the potential to disrupt the entire commercial delivery industry; Google , Baidu, Volvo, and many others, already stepping in and working hard to establish themselves in the industry too.

Unlike other technological advancements, for example, artificial intelligence, Internet of Things, or nanotechnology, the AV industry is locked up in regulation from head to toe. A car, even semi-automated, will not be allowed to drive even one single yard without prior approval of the regulator, not to mention an en masse authorization of fully autonomous vehicles to take the streets. Public safety is the foremost concern and rightfully so. This means that major players’ financial investments and remarkable technological achievements are not enough. To drive the AV industry forward, it is essential to accompany such progress with the creation of the appropriate legal structure that aligns with the new emerging reality.

Looking a decade or two into the future, we are likely to live in a world in which most of the traffic in western countries will be autonomous. Human beings will no longer be drivers. They would eventually lose this battle to computers, which will use machine learning-based algorithms to drive vehicles in the most secure and efficient way possible. This also means that the issue of liability for car accidents will have to be reviewed, paving the way for a new legal regime that holds the manufacturer and other service providers chiefly liable for any damage caused to human well-being or property.

Furthermore, the growing trend of the “sharing economy” and the increase in use of autonomous vehicles could lead to the conceivable end of private ownership of automobiles. The industry could gradually shift away from an individual consumer customer base to corporations running large fleets of vehicles. Essentially, there would be no economic justification for owning a vehicle that is not in use 95 percent of the time (and requires an expensive parking space).

The design of the vehicle itself would also evolve. The notion that there is no human driver in the front seat would likely inspire new innovative designs that would elevate the safety and comfort of the travelers, allowing them to use time spent in transportation for business and pleasure in ways similar to what we see in the shipping and aviation industries.

The issue of infrastructure is equally as important. Vehicles would be able to communicate directly between themselves, with traffic signs, and with the authorities, with no human involvement, calculating the most safe and resourceful method of transportation. Rapid, ongoing and secure communication infrastructure would be essential for the operation of the AV industry. Obviously, cybersecurity concerns would be central.

Judging by the current direction, it is fair to say that the United States is leading the race, both in terms of technological advancements and amendments to existing legislation. For example, the recent U.S. Department of Transportation’s new AV policy provides a significant acceleration forward for state legislators and the AV industry. There are already signs that, with a green light from the Feds, states such as California could speed ahead to regulate driverless cars.

Other countries are also attempting to establish their own leadership in this area. The Israeli Minister of Transportation recently signed an MoU with his U.S. counterpart to invest in developing a new center for research and development of autonomous vehicles in Israel. In a brief to the press, he presented the vision of autonomous vehicles driving on Israeli streets by 2020, thus turning Israel into one of the first countries to allow for the full operation of autonomous vehicles. A special interagency team was compiled to discuss the need for a new regulatory framework to be established in time for the arrival of the first autonomous car to be cruising down the Israeli freeway.

Singapore has also launched the first operational taxi service run by NuTonomy, an autonomous vehicle software startup. Singaporean good weather, great infrastructure, obedient drivers and the geographical characteristic of being a land-locked island have turned it into an ideal laboratory for the introduction of AV.

Devising a new regulation for emerging technologies is an art form. Knowing the law and its reasoning is vital, but not enough. As the great horse manure crisis of 1894 has shown us, it isn’t enough just to get policymakers together in a room, but for them to have the crucial capacity to envision an entirely new set of rules once they get there. Regulators need to be able to imagine a detailed vision of the future in order to construct a legal regime which provides adequate solutions to a reality that has yet to mature. The uncharted future often leads to short-sightedness, which in turns creates a tendency to deal with immediate and minute problems, instead of focusing on the bigger picture. There is no doubt today that the autonomous vehicles industry is facing gigantic challenges that demand creative and robust legal thinking, not meaningless muddling in manure.