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TL;DR: In an economy with government involvement as heavy as ours[1], it's ludicrous to claim that people should not only know the "true" value of something bu

TL;DR: In an economy with government involvement as heavy as ours[1], it's ludicrous to claim that people should not only know the "true" value of something but know precisely when the gov't is going to decide that the market value should be allowed to revert to its "true" value. > Taxi drivers did not get screwed. It's medallion owners that got screwed Right, good catch, I wasn't thinking about that fact. That's not central to my point but it is a good point to clarify. > The medallion owners who got screwed do partially have themselves to blame, because they saw the outrageously inflated prices for medallions and chose to pay them anyway. This doesn't make a whole lot of sense to me. What is the "true" value of a taxi medallion, in a regulatory context where the government is setting the supply? If we implement [insert optimal healthcare policy] and (hypothetically), doctor salaries drop precipitously, are doctors to blame for seeing how "outrageously inflated" med school tuition was and choosing to pay it anyway? Should they have stayed out of the field entirely until healthcare policy in this country is perfectly optimal? For the life of me, I'll never understand the lack of empathy required to see someone get screwed by unstable rules and conclude "well, it's your own damn fault: you should have been born one of the X-Men, with the ability to predict the future perfectly and realize that this particular inefficient policy regime was going to be disavowed at this exact time". Providing a stable legal framework is one of the most basic and most important jobs of a gov't, and making changes like suddenly deciding to stop enforcement of policy that the industry has been dealing with for decades is what legal scholars call "a dick move". Here's another example which might be more directly relatable: if you buy a house in California and Prop 13 gets repealed or if you own real estate anywhere and our idiotic policy regime around real estate gets fixed: you'd suddenly lose a huge portion of your life savings, but you'd have yourself to blame because "you saw the outrageously inflated prices and chose to pay them anyway"? Bear in mind that even if you were intellectually consistent here and agreed that those homeowners are to blame, that would be terrible advice for the literally centuries' worth of landowners/homeowners in whose lifetimes real estate policy wasn't made efficient or fair, and real estate value growth accrued to arbitrary people through rent-seeking. [1] Not that that's a bad thing necessarily

ams6110 9y ago
What is the "true" value of a taxi medallion, in a regulatory context where the government is setting the supply? You can compute the present value of the total profit you can expect to earn (average fares less expenses including the medallion) and if it's less than what the medallion costs, the medallion is overpriced.
- didibus 9y ago
  I don't think it was though. A medallion would make you around 50k in profit a year. Medallion's were a great investment, but the greatnest of them depended 100% on the government regulations staying relatively the same.
- wutbrodo 9y ago
  > You can compute the present value of the total profit you can expect to earn This isn't what we're talking about here. That's the equilibrium market price of the medallion, but the person I was responding to was saying that the overinflation due to supply restriction through gov't policy (i.e. medallions) was what was causing market value to diverge from "true" value. The fact that his goal is basically unreachable is sort of my point: his definition of "true" involves an ideal world in which taxis are optimally regulated.
chongli 9y ago
I'll never understand the lack of empathy required to see someone get screwed by unstable rules and conclude "well, it's your own damn fault The lack of empathy stems from the behaviour of medallion owners. They're right up there with patent trolls in their unlikeability. They purchase access to a government-granted virtual monopoly and use it to extract rent from hard-working people. They form industry associations and use their profits to lobby the issuing municipalities for rate hikes and other laws that help them squeeze the drivers for more money. They produce nothing and the capital they own has zero intrinsic value. Frankly, I struggle to see what there is to like about them.
- CydeWeys 9y ago
  Nail on the head here. I'm quite a liberal/progressive person, and I have empathy for many people in rough situations, but medallion owners are so hard to empathize with. I do think of them like patent trolls.

ams6110 9y ago

What is the "true" value of a taxi medallion, in a regulatory context where the government is setting the supply? You can compute the present value of the total profit you can expect to earn (average fares less expenses including the medallion) and if it's less than what the medallion costs, the medallion is overpriced.

didibus 9y ago
I don't think it was though. A medallion would make you around 50k in profit a year. Medallion's were a great investment, but the greatnest of them depended 100% on the government regulations staying relatively the same.
wutbrodo 9y ago
> You can compute the present value of the total profit you can expect to earn This isn't what we're talking about here. That's the equilibrium market price of the medallion, but the person I was responding to was saying that the overinflation due to supply restriction through gov't policy (i.e. medallions) was what was causing market value to diverge from "true" value. The fact that his goal is basically unreachable is sort of my point: his definition of "true" involves an ideal world in which taxis are optimally regulated.

chongli 9y ago

I'll never understand the lack of empathy required to see someone get screwed by unstable rules and conclude "well, it's your own damn fault The lack of empathy stems from the behaviour of medallion owners. They're right up there with patent trolls in their unlikeability. They purchase access to a government-granted virtual monopoly and use it to extract rent from hard-working people. They form industry associations and use their profits to lobby the issuing municipalities for rate hikes and other laws that help them squeeze the drivers for more money. They produce nothing and the capital they own has zero intrinsic value. Frankly, I struggle to see what there is to like about them.

CydeWeys 9y ago
Nail on the head here. I'm quite a liberal/progressive person, and I have empathy for many people in rough situations, but medallion owners are so hard to empathize with. I do think of them like patent trolls.