Imagine if driver's licenses were treated the same way cities treat taxi licenses and liquor licenses.
The number available is limited, so if you want a driver's license you have to wait for someone to die, and then buy the license from the estate. Since it's artificially scarce you'd have to pay a pretty penny to get one. Some companies might step in and buy up driver's licenses to rent them to drivers for only a few hundred dollars a month...
Treating any form of license as transferable private property seems to be against the public interest.
My primary memory of my first Singapore visit a few years ago is how nearly impossible it was to find a taxi in the afternoon/evening. Ended up spending an hour walking back to the hotel instead.
Singapore is a different case, because it's such a small country. Between the size of the island and the climate (hot/humid) they can't afford uncontrolled growth of car usage. It's also a place (like Manhattan) where you don't need a car.
Frankly, I think car usage should, ideally, cost 2-3 times what it costs in the U.S. to account for all the externalized costs. (Those taxes could be used to modernize the train system and public transportation.) That wouldn't be practical, unfortunately, as the country is set up now.
Public transport and trains don't do anything to help the many folks living outside cities. Singapore is very different to downtown Texarkana.
Try telling bill the farmer that his truck is gonna cost 3x more to run this year to help fund light rail in The city. Singapore and the US is an apples to pork chops comparison.
Australia has a system whereby "bill the farmer" (and miners) can claim a tax credit for fuel excise taxes, whereas inner city drivers can't.
The UK has a system where inner city drivers have to pay congestion taxes.
Both of these systems make some progress towards limiting congestion and subsidising public transport in dense areas without hurting those outside the cities. Personally I think they should both go a lot further.
Plus there are many ways the Singaporean government gives advantages to the very wealthy. Providing them with roads that everybody pays for but they don't have to share is but one of many.
It is very much so. It's a form of capturing rent. Look at how crazy the taxi companies go to protect this revenue stream. They keep this because they are tenacious 1 issue voters. (And in NYC, the current mayor was elected on the basis of unions and 1 issue voters like this)
In my view the taxi licenses should be of fixed length. It's ok to say "The roads only allow for 13K (or however many) taxis." It's wrong to give people a lifetime annuity based on it, and create a barrier to entry in the industry. Better to have a fixed term like 5 or 10 years. Long enough that it's worth investing in the business. Short enough that others can enter. And the total # should be flexible, perhaps linked to traffic and population.
If you're going to argue against taxi licenses or anything else, please explain why you think the reasons why some people believe the good outweighs the bad are wrong, rather than just pointing out that there is bad.
New York's rent stabilization isn't that bad, but it also doesn't have a major effect on rents, either for those who have it or those who don't. (Rent-stabilized apartments can go up by a few percent per year.) It's the 1947-era legacy rent control that is patently ridiculous.
Most people underestimate the harm of that program because they don't understand price elasticity. It's true that only ~1-2% of apartments are under that system. However, 1-2% supply destruction can actually double prices. (See: oil shocks.)
Another problem is that this country is run by scumbags and pussies who allow foreigners to own real estate (many countries don't). Now, I'm all for a reasonably open immigration policy, and letting foreigners live here is not the issue. (The people who move here to live here don't have a major effect on the rent, and are good for the country overall.) But the types of foreigners who buy U.S. real estate are usually corrupt officials who want a place to live if their own country brings them to trial. (In China, corruption is a death-penalty offense.) This is the real reason why Silicon Valley is so expensive: every fucking Communist Party scumbag in China and murdering Russian oligarch and Arab slave state billionaire has bought a place (even if it goes uninhabited) in California. It doesn't affect a large number of houses, strictly speaking, but it's enough of a margin to have massive impacts on the price level.
I am amazed at Americans' willingness to be "patriotic" about stupid things and get into nonsensical wars... but then we go and let corrupt, murdering dictators and billionaires from all over the world buy California and Manhattan real estate. It's fucking disgusting.
Do you have any evidence to back-up the claim that foreigners are driving up the cost of property? I can't find the source now, but from the data I've seen, foreign purchases amount to less than 10%. What really drives up housing pricing in the bay area is speculation where contractors purchases homes for cash and flip them.
The other thing to think about is, do you really think "communists from china" are buying 1-bedroom apartments in the Mission? No, they are buying the multi-million dollar homes in Russian Hill. For the average American those homes were never within budget.
Cities scale just fine. They become more efficient as you build up. That goes until you're at about 50 stories, which is more average height than most US cities by far (New York has a lot of prime real estate at 3-5 stories, such as in the Village).
The problem is people. People usually fight against "ugly" new development and "Manhattanization" and change of all kinds, and while they make arguments based on urban beauty, they're really just trying to protect their obscene premiums on real estate by blocking new supply.
I actually think urban home ownership makes no sense for most people. Ownership is about a sense of control. If you live in the woods and sit on an acre of land or two, you can be pretty sure that no one's going to block your morning sun, or set up a nightclub next door. Cities can't afford to grant those assurances. It's just better, from that standpoint, for most people to rent. Why make your primary investment something that another person with more power and more money can easily fuck up, just by buying space near it?
"The threat to medallion owners isn’t that they’ll lose passengers to these services. It’s that they’ll lose drivers — who have been aggressively courted by Uber.
“Without the drivers, we’re dead,”
"
Oh really? Please tell me again how people were thinking a gimmick that's valuable only because of a government imposed monopoly is a sound investment.
The bubble is popping. And it would be interesting to ask why did the price started going up around the 2000s...
> a gimmick that's valuable only because of a government imposed monopoly is a sound investment
City streets are a limited public good. Aside from ensuring quality and consumer protection, regulation & limiting the number of taxis ensures that traffic can actually flow.
A traffic consultant says that NYC's plan to add 2,000 medallions could slow down all traffic by 12% because taxis don't park -- they roam the streets constantly.
If you limit taxis, more people will drive their own cars. To make up some numbers, if you want to take 2000 cars off the road, you might have to eliminate 2500 or 3000 medallions.
Instead, traffic-limiting measures should target all vehicles using congestion tolls, gas taxes, vehicle taxes, or something more innovative.
I don't buy that analysis. In NYC, you don't need a medallion to operate a taxi - you only need one for a yellow taxi that can legally stop when hailed on the street. Having more medallion taxis just means that these taxis will take business away from the "black car" (reservation-driven) companies and from services like Uber (and those cars never park either - if they're not moving, they're not making money). Increasing the number of medallions won't magically increase the usage of taxis - the people who can afford them already use them, but for the vast majority of New Yorkers, the prices are way out of reach and they take public transit.
The problem is not the regulation or limiting the available licenses per se, it's rather the ability to transfer or sell them.
If the current license holder can't or won't use it for another year there's absolutely no reason he should be allowed to transfer his permit. The regulator should just keep a list of people interested in it and let the next one have his turn.
Am I the only person that thinks government regulation is a reasonable thing for the taxi industry? Regulations on work hours, car safety, tougher environmental standards, driver training, requiring pickup if called, etc all seem reasonable. It's unfair that Uber is able to skirt most of these rules. The same could be said for hotels (noise, safety regs, etc) and restaurants (food safety, etc). Should all services be unregulated? Anyways, I do think things like Uber and Airbnb are very cool and innovative, I just feel a little uncomfortable about where it's leading us to.
The biggest issue that I have with this is that the government regulations are meaningless these days due to lack of code enforcement.
Two great examples:
1.) Staying in Fremont, CA, needing a trip to the San Jose airport at 4:50 in the morning. I had a cab 'scheduled' but a few drivers didn't show up, and they didn't bother calling me to let me know that they were not going to show up. The dispatcher didn't speak english well and didn't understand the questions that I asked. If I had instant feedback that nobody was coming, I would have made alternate plans the minute that I knew nobody was going to pick me up.
2.) In Chicago for a business trip. I generally don't carry cash, but, needed a ride from point a to point b. Taxi driver's sticker said he took credit cards, but his machine was 'down.' A "standoff" of sorts occurred between me, the taxi driver, and Chicago PD; ultimately, after the police harassing him (and reminding him that a working credit card reader was required in the city), he reluctantly ran my credit card and let me out of his car.
It's unfair that the Taxi companies skirt these rules too -- Uber and Lyft just give their ecosystems a quicker way to get ride of bad actors and focus on customer service, where the Taxi companies are focused on keeping the medallion owners happy.
I think that's a very underestimated reason for why taxis and Uber alike are hated by many. There is an artificial medallion shortage, sure, but I'm in the same bucket as skosuri and think that code enforcement would solve a lot of problems. I think that even forcing Uber et al to participate in some of the codes - or creating new ones for rideshare services - would be great. Stuff like working with local paratransit services, 24/7 availability with decent coverage, choices that are more like "I have a wheelchair/need a ramp or lots of luggage" vs luxury or not (uber SUVs are occasionally super hard to come by!) and a standardized, routinely enforced safety program for vehicles and drivers alike.
Then the argument for overhauling taxi medallions and restrictive rideshare laws wouldn't be sidelined so often by stories of shitty uber drivers/practices and bad taxis alike. I also feel that everyone would benefit from this kind of government regulation _if done well_, because if left alone with little enforcement and only free market choices to influence business decisions, nobody would want to deal with servicing half of San Francisco, or folks with disabilities. Like your story of getting to SJC from Fremont - have you tried to catch an Uber on the east side of the Bay Area when you're not in downtown Oakland or near airports? It takes forever and a half even during the day. It's easier to just walk/use AC Transit to a BART station or wait and call for a regular cab five times than it is to wait for an Uber from OAK or worse for me, even though there were a whole bunch of times where I _wanted_ to pay for an Uber from Hayward to SF multiple times in a week (read: BART strike).
I've seen the other way around just as much if not more so. People calling taxis and then not waiting for the one they called, with a driver just hanging around. My experience in Boston was quite good over many hundreds of taxis rides. As far as I saw, the rules were generally followed.
I've never had this issue. Every dispatcher has spoken very clearly and my cab orders have arrived on or ahead of time every time. As for the credit card issue that is easy enough to fix. I always give them a cash tip and then ask them to put the actual travel charge on a credit card.
Cities vary. There are good cab drivers, bad ones, and really bad ones. I've had the same things happen to me as the previous poster: didn't show up, claimed credit card didn't work (frequent.)
I have also had a few other things: kidnapped, cab driver trying to run other cars off the road, talking on cell phone (40% - 60% of the time), stopping for gas, picking up their friends, operate a vehicle with brakes that were clearly barely operable, and so on.
This is what you'd expect government to do when taking away a licence would mean the person loses their livelihood.
The same thing is true for lawyers, land meters, certified accountants, ... they effectively get one "get out of jail free" card for any offence that occurred on the job, and isn't an obvious repeat offence, or was an obvious case of corruption (and getting paid a lot, but not directly to commit a crime is not corruption).
Why ? Two reasons. Firstly, because taking that licence destroys the person, nobody wants to do it. Second because of the effect of taking away licences, their competitors could cause their licence to be taken away to increase business (for lawyers at least, I know two cases where this happened)
It's a nice theory, but in my experience taxi drivers are often clueless and/or cheating, and their cars are often run-down. Literally every single time I have used a taxi in the last couple of years it was at least one of these three problems.
The current regulation regime does not produce safety, fairness or improve quality, but it does stifle competition.
Well it's one against one. I didn't own a car for the last 12 years. I've had an overall great experience with taxis over many hundreds of taxi rides. So we can compare our usage, but your anecdote is just that.
My anecdote is just enough to show it's not a slam-dunk victory for regulated cab regime.
The question we should be debating is the relative quality of regulated Taxi vs. Uber-style free market. To make progress we would need to allow Uber to operate for some time, and then look at the accident/crime/satisfaction surveys. Speculating about what regulation can do for us in theory is fruitless, and denying the opportunity for alternatives to be tested out, which is what those cab-lobbies advocate, is dishonest.
What people don't realize is neither Uber nor medallion owners care one bit for the people they are meant to serve. Arguments on all sides are driven by selfish parties that only want to set up a system to benefit them. At the end of the day Uber would like to be the only game in town and Uber investors would like nothing more than a well-oiled corporate machine that prints money. So all this talk of consumer choice and safety is a red herring. It's definitely good marketing but don't be fooled into thinking Uber is helping anyone but themselves when they push for deregulation.
So yes I'm with you on this one. I also find it a little funny that everyone brings up anecdotal evidence about shitty cab drivers and awesome Uber drivers as an argument for deregulation. Such micro activities are meaningless in the face of what happens at the macro-economic scale.
All the things you listed are perfectly reasonable. But, in some regions, the government deliberately issues too few medallions. This means consumers pay higher prices, and all that money goes to well-connected people who managed to get the medallions. Those people don't actually drive the taxis, they just take the money.
Better regulation, like what you describe, seems better than no regulation, but I'd be willing to accept no taxi regulation if it gets rid of the political cronyism and high prices that go with it.
Usually more expensive, but that depends on when you ride -- prices go up during hours of peak demand, like Friday nights, and fall at other times. Some rough numbers here:
> I don't use Uber, but is it generally cheaper than taxis?
no, generally more expensive, but the product is way better. My girlfriend gets sick with exhaust vapors when typical cheap taxi drivers lave their windows open and insist their AC is broken. Taxi shocks are usually shot, and the ride crashes around on city streets. Uber has nice, comfy, clean, big, air conditioned vehicles. Worth the extra money.
I started to get sick on one of my last Uber rides because the driver had on an absurd amount of cologne. Another had no clue what he was doing and explicitly took the street he was told not to take, getting stuck in the traffic I was hoping to avoid. Some of them are really reckless about driving too, sometimes ignoring posted signs altogether, and I think the only saving grace is that the cars are usually brand new.
I could go on about how much I have a problem with Uber, just like how much I hate taxis. The only nice thing about Uber here is that there's an easy way to get in touch and fix a problem. That for sure, I agree, is worth the cost.
That being said, I've found UberX in SF is cheaper than cabs, so I have even less interest in taking cabs.... but the last few cities I went to like NYC and Miami, the cabs were great. Wish SFMTA would step it up...
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I don't see why a special set of rules have to apply to just taxi drivers. Isn't working hours regulated already by OSHA? Car safety by the NHTSA? Requiring a pickup might be something that doesn't even need enforcing when there are dozens of drivers in your area.
Well taxi's are on the road a lot more than normal cars. There are separate rules for commercial vehicles for instance. Also, since most of the driver's are freelancers (and not Uber employees), I don't see how OSHA rules apply (although perhaps I'm wrong).
The different rules for commercial vehicles are because the vehicles need a lot more maintenance to be safe on the road. Delivery drivers don't get any more inspections.
But it's not clear to me that other types of regulation are desirable. Environmental standards should be the same for all cars; driver training has been made almost redundant by sat-nav systems; a reputation-based system might be better than a 'requiring pickup' system.
In particular, I want a regulatory system that makes it easy for someone to be a taxi driver only from midnight to 2am on Saturday nights. Or only to and from the airport between 3pm and 6pm. This is the sort of flexibility that brings down costs overall.
Where do you stop? I am sure we can point to any service/industry and find enough "reasons" to regulate it.
Did you know in many cities you cannot be a tour guide without a license? Open a hair salon? Want to do business with a government agency, well there might be rules pertaining to the services your business provides in that case, and that case only.
The list goes on and on. Eventually we need to really analyze what really is important. I would say if life is on the line then you might be justified, but driving a few people between points on a map?
Regulation is one thing, but I think a buried innovation of on-call driver services is the disintermediation of reservations that removes the dispatcher's judgement that serves to decrease service in certain situations.
That just means that there is room for a company to develop and create better dispatch software for the taxi industry, not that all regulation should be decimated to make dispatching better.
They are different issues, and the historical controversies (where I live) over dispatch policies and biases imply the taxi industry is in no hurry to eliminate their Louie De Palmas.
Urban taxi companies have many, many problems that have persisted for decades. There is no one solution that covers all of them.
That's a nice theory, but I think that's what got us into the regulation in the first place. People basically don't know the place, don't know the cabs drivers, and you can't really choose based on quality if you are stuck in an unknown city with same-looking cabs.
Now Uber is probably changing all that thanks to mobile internet, but that wasn't possible before.
I buy all my prescription drugs over the Internet without a valid Rx. Not all that interested in heading to the GP to get a script that says "This has been a recurring problem" for the price of an outrageous co-pay and possibly a hassle from my insurance company.
Am I the only person that thinks government regulation is a reasonable thing for the taxi industry? Regulations on work hours, car safety, tougher environmental standards, driver training, requiring pickup if called, etc all seem reasonable.
I agree.
The medallion system is a disaster. In fact, it's systemized government corruption. Most of these medallion-owning assholes have never driven a taxi in their lives. They're just rent-seeking vampires.
The purpose of limiting the supply of drivers is to prevent a race to the bottom-- and I would generally support that, for a variety of reasons. But the effect of the medallion system is that drivers do no better under the system than without it, because they have to pay enormous leasing fees.
A fully unregulated system is a bad idea (it means you're screwed if you live in the outer boroughs, it will encourage unsafe conditions and driving) but the medallion system needs to be shut down.
I do think things like Uber and Airbnb are very cool and innovative
Uber is an evil company. It's not surge pricing alone that makes it evil. It's the complete lack of transparency around surge pricing, and the fact that (unlike Lyft) it increases its own take when surge is in effect. It's one thing for prices to go up when the supply of cars can't mean demand. It's an entirely different situation when the (a) pricing algorithm is opaque and (b) it's determined unilaterally by a company with every incentive to manipulate it.
I am glad to see the medallion parasites under threat, though. If I were mayor of any of these cities, my first move would be to scrap the medallion system, with no compensation to their owners.
How is surge pricing "evil"? You are free to use Uber or not. When surge pricing is in effect, you have to agree to it before going forward in the app.
It's not hard. If you don't like the price of something, don't buy it.
Uber is evil because it doesn't publish the conditions under which surge pricing will occur, and because surge pricing often happens when there are plenty of drivers available.
Uber collects when surge pricing is in effect, which means that there's a conflict of interest in how it manages this algorithm, which is not really a free market. In a free market, drivers and riders (not Uber) would decide on the price point for each level of service and availability.
There is no conflict of interest because it is clear that Uber's goal is to maximise profit for its shareholders - and that is fine. We let Toyota and Starbucks manage the 'algorithm' for pricing cars and coffee, so why not let Uber do the same for rides? If their price is too high then some other company (eg. Lyft) will offer a lower price and grab the business - seems like a free market to me.
I don't really think surge pricing poses a conflict of interest for Uber. If I were running the company, I'd hate surge pricing. Who wants to pay 2 or 3 times the normal rate for a ride?
I would imagine that when surge pricing is in effect Uber comes away with less revenue than periods where fares are normal.
At that point, something like Uber still makes sense as a centralized ride brokerage. Cab companies will have driverless cars that go everywhere, but on many cities, no company will have enough cars for you to just want to go to their website to request a ride.
It becomes a mix of Expedia an an auction site. You say where you are, and where you want to go, and get bids from car companies that claim to be able to get to you in X time, and charge you Y to get to your destination. You get to pick. With automated cars, their bids are all by algorithm.
I'd be shocked if the Uber people weren't thinking about this problem today.
> At that point, something like Uber still makes sense as a centralized ride brokerage.
Since this is such an obvious part of the business model, I don't think they will get the chance to do this.
There's one thing people don't yet understand about robots in the public space. Who carries the responsibility for the driving, and for accidents ? Currently for normal cars this is shared between producer and driver. With self-driving cars both the producer and driver are one and the same company, and obviously the occupants won't feel a great sense of responsibility, they'll feel they are victims, for obvious reasons : they didn't do anything.
So ownership and insurance of things don't make sense for driver less cars. Ownership of them doesn't make sense because the responsibility thing doesn't work if you don't allow the producer remote access to do anything they want to the car. Insurance doesn't make sense for similar reasons.
So yes I'm sure the car companies will allow Uber to take part in some "affiliate" scheme, but I'd expect that to be the limit of their involvement.
I think the general idea behind driverless cars is that they can be JIT-rented, and since Uber would have the infrastructure in place, they would be the natural market leader.
I've always thought that was Uber's endgame. Get in now and establish a brand with existing technology (taxi drivers) so that you're ready to capture the new market when it's ready (driverless cars).
There's a kind of live by the sword, die by the sword theme here. If government rules can be enacted to make an item's value go up, they can also change to make the same item's value go down.
In February, he sued the city on behalf of medallion
owners, brokers, managers, financiers and cab
affiliations. The suit argues that the city has violated
their rights by allowing new companies to provide an
essentially identical transportation service without
complying with existing regulation. By eliminating the
exclusive right of medallion owners to provide that
service, the suit argues, the city has taken away the
thing that gives medallions their value as property
under Illinois law.
“If you think it’s an improvement to change the rules,
maybe you can do that,” says Edward Feldman, a partner
with Shakman. “But you have to provide compensation for
the property rights you’re destroying. And that’s the
Constitution.”
Medallions represent a promise, he says. And on that
promise, medallion owners took out mortgage-size loans.
If the city backs out of that promise, it must make them
whole.
So, if I buy a fishing license but fail to catch any fish, can I sue my state's Department of Fish and Wildlife for a refund of my $50? I wonder what people would say if I tried?
That's an invalid analogy. A valid analogy would be that you purchased a fishing license from your state's Department of Fish and Wildlife because you were told one was legally required to fish in a certain location, but the Department of Fish and Wildlife then failed to take action against others who began fishing in that same location without a license.
Good idea or horrible idea, certain cities created licensing regimes that promised to protect taxi drivers from competition if they paid for medallions. Now that others are flouting the law and circumventing the licensing regime, the taxi drivers want their protection money back if they're not going to receive the protection they were promised.
In terms of individual taxi drivers who took out massive loans this is a valid argument. In terms of the rent-seeking institutional investors who lobbied the government to create an asset class which diverts most of the profits away from the people actually doing the work and makes taxis more expensive for no return in public benefit.
I have no issue with government regulation of the taxi industry - quite the opposite. Certainly I think that it's important to mandate vehicle safety inspections. But if taxi licenses are going to be supply constrained, they should be issued by the government for a flat fee on a first-come first-served, use-it-or-lose-it basis. They should only be purchasable by the driver that will be driving the taxi and they should not be transferrable.
The arguments about chaos without regulations is bullshit. There are proofs around the world.
It's going to be very interesting to see how the industry will change.
1. Almost all will switch to Uber, Lyft etc.
2. Driveless cars take over.
3. Distributed network of driveless cars backed by bitcoin like transactions. No need for central logistics like Uber.
Anyone else find the graph of medallion values a little weird?
Looking at the DJIA, It was ~11,700 in Jan 2000 and by March 2009 it was down to ~6,600. The graph makes it look like it was about 100% of what it was in 2000. That makes no sense.
Also, they have the CPI plotted, but it's a straight line at 100. So they might be correcting for CPI, but in that case, you'd expect the 2009 DJIA to be even lower.
How much can someone who already has their own car make doing Lyft, UberX or Sidecar? It might be a good option for empty-nesters who need extra cash but don't want to sell assets or dip into pension pots.
I took UberX yesterday. The driver told me he used to be a cab driver and he loved Uber. He made more money and spent less time doing it. For reference, when he drove a cab he had to spend $600 per month to rent the car!
The number available is limited, so if you want a driver's license you have to wait for someone to die, and then buy the license from the estate. Since it's artificially scarce you'd have to pay a pretty penny to get one. Some companies might step in and buy up driver's licenses to rent them to drivers for only a few hundred dollars a month...
Treating any form of license as transferable private property seems to be against the public interest.