5 ms·

This is an especially poignant story, and it's hard to not feel bad for this driver. On the other hand, people face investment risk all the time, i.e. when fra

This is an especially poignant story, and it's hard to not feel bad for this driver. On the other hand, people face investment risk all the time, i.e. when franchising a restaurant. When Chipotle or whoever comes in and devours the fast food market, I wonder if the local struggling burger franchisee asks the city for help? I can't speak on behalf of other cities, but anyone who has lived in SF pre-Uber has no shortage of nightmare stories from taking cabs. For people who had to wait years and pay enormous costs for their medallions, many taxi drivers acted smug, entitled, rude, and sometimes even downright shady. I know you can't say this about _every_ taxi driver, but there's no doubt that the current ecosystem treats the consumer many orders of magnitude better.

lolwutf 11y ago
Comparing a human being to a local burger franchisee is a pretty awful analogy.
- panorama 11y ago
  I was referring to a franchisee as a human being. A franchise is a business.
Multiplayer 11y ago
It's not quite the whole story. Medallions used to be almost free, which is why the waitlist was 10 years. They started charging 250k, but you can give them back for 200k. From the MTA site: By capping the sale price of medallions, the MTA insulates medallion holders from market fluctuations, either up or down. When drivers want to resell, the price is what they paid, minus a 5 percent transfer fee. The agency said it is unlikely to cut the price. For those cabbies who paid nearly nothing for their medallions, the new sales system is an even better deal; they receive $200,000 when they surrender it for resale."
- Scoundreller 11y ago
  > For those cabbies who paid nearly nothing for their medallions... I'd argue they did pay for them, they worked for below-average wages for 10 years in the hopes of a payoff. Long-term drivers tend to see getting a medallion as a retirement plan.
  - Scoundreller 11y ago
    Not understanding the downvotes: Since cab drivers are bidding against each other for a medallion-car, if they bid more to get a car that shift/day/week, they earn less. If, after 10 years of driving a cab, one could get a $250k wind-fall, one would be willing to earn less during those 10 years than if the wind-fall did not exist.
- smsm42 11y ago
  > Medallions used to be almost free, which is why the waitlist was 10 years. I imagine the waitlist was 10 years not because medallions were cheap, but because there wasn't enough of them issued to satisfy the demand.
qq66 11y ago
People face investment risk all the time, but medallions are a case of a city setting explicit expectations when selling the medallions and then changing the terms of the deal post facto. Chipotle devoured a huge chunk of the fast food market, but the city didn't collect money from McDonalds for a guarantee that Chipotle wouldn't be allowed to enter. Notably, this is illegal by federal law for auto manufacturers and other franchisors: if you promise a 25-mile exclusivity radius and get a franchisee to build a dealership, you cannot renege on that without being liable for damages. Interestingly, it's auto manufacturers who lobbied for these laws, wanting to kickstart a dealership ecosystem and knowing that franchisees would not invest money in building and marketing dealerships if they did not have suitable protections. Taxi drivers are a form of franchisee, and they are asking for similar protections. One possible solution is for the city to buy back all the extant medallions at some fixed price, do away with the system, and finance the purchase with an excise tax on all types of transportation going forward, whether rideshares, taxis, etc. You can imagine how Uber feels about that, and how they can mobilize their vast PR capabilities against such a concept.
- deleted 11y ago
  [deleted]
- SilasX 11y ago
  Hold on -- there's a big difference between "the government reneged on its promise to keep squatters off your land" vs "no one wants your land anymore". If they start turning a blind eye to squatters, it's fair to criticize that government for reneging. If the other city becomes such a vibrant spot that no one wants to live near you -- different story entirely. While local governments are arguably failing to require newer livery services like Uber and Lyft to meet e.g. higher insurance requirements, they are not reneging on the medallion promise, which still gives holders the exclusive right to pick up street hails. That right is still enforced, and the Uber/Lyfts of the world are not infringing on it. The situation is much closer to "street hail pickup rights aren't valuable anymore" than "governments enable encroachment on the right to pick up street hails". And before you dismiss "arranged hire" (livery) vs "street hail" as a technicality, there are very good reasons to put a cap on the latter but not the former (and otherwise subject the latter to harsher regulation): - By necessity, street hails require clogging of "Schelling points" where drivers can expect to get line-of-sight to a potential fare, and vice versa. That doesn't happen with livery, where they go only where requested, not significantly different from a private car. - Street hails create a risk of fighting over fairs, livery doesn't. - Street hails enable you to pressure naive passersby/tourists to take your rate, livery requires you to ask for the fare from a central service. - Medallion holders get use of the scarce privileges to use taxi stands and bus-only lanes, livery doesn't. - Livery creates a central, auditable record of the event, while street hails can rip you off without showing up on an audit. To be sure, Uber/Lyft are flouting even some of the requirements of livery services ... but the medallion case looks more like "street hails are becoming obsolete in the information age, so of course they'll lose value".
kenrikm 11y ago
“I thought … there should be proper rules and regulations,” Batth says. “We have a very corrupt society back in India. With money, anything gets done. I never thought it would be the same in this country.” I found quite a bit of irony in this quote, The taxi industry has historically been very corrupt. Bribes to city officials to artificially keep the prices for medallions going up (not adding new ones) and to prevent competition are common. I do feel bad for this driver but at some point if you're paying $250k for a chunk of metal you have to stop and think that what you're really paying for is a monopoly in performing a specific action I.E picking up passengers that hail you and this is not a guarantee that that business continue to be worth what it was.

lolwutf 11y ago

Comparing a human being to a local burger franchisee is a pretty awful analogy.

panorama 11y ago
I was referring to a franchisee as a human being. A franchise is a business.

Multiplayer 11y ago

It's not quite the whole story. Medallions used to be almost free, which is why the waitlist was 10 years. They started charging 250k, but you can give them back for 200k. From the MTA site: By capping the sale price of medallions, the MTA insulates medallion holders from market fluctuations, either up or down. When drivers want to resell, the price is what they paid, minus a 5 percent transfer fee. The agency said it is unlikely to cut the price. For those cabbies who paid nearly nothing for their medallions, the new sales system is an even better deal; they receive $200,000 when they surrender it for resale."

Scoundreller 11y ago
> For those cabbies who paid nearly nothing for their medallions... I'd argue they did pay for them, they worked for below-average wages for 10 years in the hopes of a payoff. Long-term drivers tend to see getting a medallion as a retirement plan.
- Scoundreller 11y ago
  Not understanding the downvotes: Since cab drivers are bidding against each other for a medallion-car, if they bid more to get a car that shift/day/week, they earn less. If, after 10 years of driving a cab, one could get a $250k wind-fall, one would be willing to earn less during those 10 years than if the wind-fall did not exist.
smsm42 11y ago
> Medallions used to be almost free, which is why the waitlist was 10 years. I imagine the waitlist was 10 years not because medallions were cheap, but because there wasn't enough of them issued to satisfy the demand.

qq66 11y ago

People face investment risk all the time, but medallions are a case of a city setting explicit expectations when selling the medallions and then changing the terms of the deal post facto. Chipotle devoured a huge chunk of the fast food market, but the city didn't collect money from McDonalds for a guarantee that Chipotle wouldn't be allowed to enter. Notably, this is illegal by federal law for auto manufacturers and other franchisors: if you promise a 25-mile exclusivity radius and get a franchisee to build a dealership, you cannot renege on that without being liable for damages. Interestingly, it's auto manufacturers who lobbied for these laws, wanting to kickstart a dealership ecosystem and knowing that franchisees would not invest money in building and marketing dealerships if they did not have suitable protections. Taxi drivers are a form of franchisee, and they are asking for similar protections. One possible solution is for the city to buy back all the extant medallions at some fixed price, do away with the system, and finance the purchase with an excise tax on all types of transportation going forward, whether rideshares, taxis, etc. You can imagine how Uber feels about that, and how they can mobilize their vast PR capabilities against such a concept.

deleted 11y ago
[deleted]
SilasX 11y ago
Hold on -- there's a big difference between "the government reneged on its promise to keep squatters off your land" vs "no one wants your land anymore". If they start turning a blind eye to squatters, it's fair to criticize that government for reneging. If the other city becomes such a vibrant spot that no one wants to live near you -- different story entirely. While local governments are arguably failing to require newer livery services like Uber and Lyft to meet e.g. higher insurance requirements, they are not reneging on the medallion promise, which still gives holders the exclusive right to pick up street hails. That right is still enforced, and the Uber/Lyfts of the world are not infringing on it. The situation is much closer to "street hail pickup rights aren't valuable anymore" than "governments enable encroachment on the right to pick up street hails". And before you dismiss "arranged hire" (livery) vs "street hail" as a technicality, there are very good reasons to put a cap on the latter but not the former (and otherwise subject the latter to harsher regulation): - By necessity, street hails require clogging of "Schelling points" where drivers can expect to get line-of-sight to a potential fare, and vice versa. That doesn't happen with livery, where they go only where requested, not significantly different from a private car. - Street hails create a risk of fighting over fairs, livery doesn't. - Street hails enable you to pressure naive passersby/tourists to take your rate, livery requires you to ask for the fare from a central service. - Medallion holders get use of the scarce privileges to use taxi stands and bus-only lanes, livery doesn't. - Livery creates a central, auditable record of the event, while street hails can rip you off without showing up on an audit. To be sure, Uber/Lyft are flouting even some of the requirements of livery services ... but the medallion case looks more like "street hails are becoming obsolete in the information age, so of course they'll lose value".

kenrikm 11y ago

“I thought … there should be proper rules and regulations,” Batth says. “We have a very corrupt society back in India. With money, anything gets done. I never thought it would be the same in this country.” I found quite a bit of irony in this quote, The taxi industry has historically been very corrupt. Bribes to city officials to artificially keep the prices for medallions going up (not adding new ones) and to prevent competition are common. I do feel bad for this driver but at some point if you're paying $250k for a chunk of metal you have to stop and think that what you're really paying for is a monopoly in performing a specific action I.E picking up passengers that hail you and this is not a guarantee that that business continue to be worth what it was.