Because that's the primary way that governments aren't just corporations: if the rulers (the majority, in a democracy) believe that Uber needs to go out, or at least needs to stop participating in the market in certain ways, the government can enforce that via its monopoly on violence.

This has historically worked pretty well for human society; for instance, if someone gets the clever idea to participate in a market by impersonating an existing, trusted market participant, or offering counterfeit goods, or using slave labor to plant cotton, or whatever other bad idea that is short-term profitable, the government can step in and say that this isn't long-term good for society.

Whether Portland is correct to stop Uber is a legitimate matter of debate, but that Portland legitimately has the ability to choose to stop Uber is, I'd hope, uncontroversial.