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Yes, the medallions were stupid, although I think they shouldn't have allowed Uber to operate without medallions, or get rid of the system in general. >Relying

by carlmr 9y ago

Yes, the medallions were stupid, although I think they shouldn't have allowed Uber to operate without medallions, or get rid of the system in general. >Relying on their "value" for retirement is crazy. And like another commenter has said - if it was worth 1.1 million, why not sell it and retire Because he took out a loan of 1.1 million to buy it. It's not that he bought it for next to nothing and it rose to that price, it was always a stable asset. Because regulation didn't allow non-medallion taxis in the city. Until Uber came and they just allowed it. >like all gambles, this one had a possibility of failing - and it did. We're not talking about the smartest people here. Something that had a stable (and slowly rising) value for 100 years didn't seem like a gamble until the lobbyists came in and convinced the lawmakers to allow unfair competition. I think medallions are stupid, but as long as the system exist, everybody needs to adhere by it, otherwise it's just f*ing over the working poor.

taneq 9y ago
Exactly, and that's my problem with ride sharing companies like Uber (or rather, with governments letting them operate as unlicenced taxis despite strict regulation of 'real' taxis). The government created an artificial monopoly, sold tickets to operate in that monopoly, and then failed to protect it. Medallions were a stupid idea but that doesn't mean the government should be able to just write them off and screw over the people holding them.
- wooter 9y ago
  So it should be able to screw people not holding them? Or those who cant get a $1 Million dollar loan or pay 3k to drive a car? Car leases are easy at $150.
  - wjnc 9y ago
    Any government policy has winners and losers. Literally any. All that's reasonable is that governments act in.good faith and with proper accounting of, say, time horizons. They should have figured out that medallions were unsustainable, what, in the low 100k's? Once it starts working as a pyramid scheme there are only losers from then on... Except the now retired taxi drivers, who banked 1M.
- autokad 9y ago
  it sounds like the cities should be forced to buy them back at the price they sold them
  - MrFantastic 9y ago
    Private profits and subsidized losses? Capitalism requires bankruptcy.
- TheCoelacanth 9y ago
  A medallion was never necessary to run a car service. There were tons of other car services operating in New York without medallions prior to Uber. The medallions were required to be able to pick up street hails. Uber does not and never has accepted street hails. They operate more like the other car services where you request a car from a central dispatcher, and then that car comes and picks you up at a location that you requested.
  - taneq 9y ago
    Yeah, but not really. In the days before mobile phones, street hails were a huge majority of a taxi's fares. Your only other choices were to call from home, find a pay phone, or find a cab rank (or does a cab rank still count as a street hail?) Apps like Uber let people effectively "street hail" while sidestepping the legalities, which were written before mobile phones became available.
adventured 9y ago
> it was always a stable asset. Because regulation didn't allow non-medallion taxis in the city. In fact it was not a stable asset. Medallion values had increased dramatically in a relatively short amount of time. They went up in price by four fold in ten years for both corporate and individual. [1] Is it rational to buy something after an extreme price appreciation like that, with the assumption that it couldn't possibly go back down? [1] https://i.imgur.com/TeJiCpf.png https://i.imgur.com/TeJiCpf.png
greeneggs 9y ago
> We're not talking about the smartest people here. Something that had a stable (and slowly rising) value for 100 years didn't seem like a gamble until the lobbyists came in and convinced the lawmakers to allow unfair competition. This is not right. It was a bubble. Prices rose from ~$250K in 2001 to over $1.2 million in 2013 [1, 2]. That's a 13% growth rate. It was obviously a bubble. Yet people were jumping on it, taking out big loans to buy more medallions. It had to burst at some point. Uber was the trigger, but this had to blow up at some point. The sooner the better. [1] https://www.bloomberg.com/features/2015-taxi-medallion-king/ https://www.bloomberg.com/features/2015-taxi-medallion-king/ [2] http://www.nyc.gov/html/tlc/downloads/pdf/march_2013_medallion_transfers.pdf http://www.nyc.gov/html/tlc/downloads/pdf/march_2013_medalli...
p0wn 9y ago
They allow non medallion cars aka the black private car service cars but I think you needed a medallion to pick up a person hailing a cab off the side of the road... ie you didn't call the car service to come pick you up. With uber they're still not picking people up that are physically hailing them. They are relying on technology aka smartphones to get around this.
- falcolas 9y ago
  Personal experience has shown that Ubers will in fact pick up folks who hail them, you just have to then set up the ride via the app afterwards. Found this out while waiting an hour for an uber driver - three others drove by and responded to my waving them down to see if they were my uber, and offered to take me (looking back, I should have taken them up on the offer). This, ironically, turned me on to the taxi system in NY. They were just more reliable at the time.
lazerpants 9y ago
Uber was allowed to operate as a "car service", which was not based on medallions. There were already many non-taxi car services operating in NYC, all Uber did was scale the idea and put it on a smartphone.

by carlmr 9y ago

taneq 9y ago

Exactly, and that's my problem with ride sharing companies like Uber (or rather, with governments letting them operate as unlicenced taxis despite strict regulation of 'real' taxis). The government created an artificial monopoly, sold tickets to operate in that monopoly, and then failed to protect it. Medallions were a stupid idea but that doesn't mean the government should be able to just write them off and screw over the people holding them.

wooter 9y ago
So it should be able to screw people not holding them? Or those who cant get a $1 Million dollar loan or pay 3k to drive a car? Car leases are easy at $150.
- wjnc 9y ago
  Any government policy has winners and losers. Literally any. All that's reasonable is that governments act in.good faith and with proper accounting of, say, time horizons. They should have figured out that medallions were unsustainable, what, in the low 100k's? Once it starts working as a pyramid scheme there are only losers from then on... Except the now retired taxi drivers, who banked 1M.
autokad 9y ago
it sounds like the cities should be forced to buy them back at the price they sold them
- MrFantastic 9y ago
  Private profits and subsidized losses? Capitalism requires bankruptcy.
TheCoelacanth 9y ago
A medallion was never necessary to run a car service. There were tons of other car services operating in New York without medallions prior to Uber. The medallions were required to be able to pick up street hails. Uber does not and never has accepted street hails. They operate more like the other car services where you request a car from a central dispatcher, and then that car comes and picks you up at a location that you requested.
- taneq 9y ago
  Yeah, but not really. In the days before mobile phones, street hails were a huge majority of a taxi's fares. Your only other choices were to call from home, find a pay phone, or find a cab rank (or does a cab rank still count as a street hail?) Apps like Uber let people effectively "street hail" while sidestepping the legalities, which were written before mobile phones became available.

adventured 9y ago

> it was always a stable asset. Because regulation didn't allow non-medallion taxis in the city. In fact it was not a stable asset. Medallion values had increased dramatically in a relatively short amount of time. They went up in price by four fold in ten years for both corporate and individual. [1] Is it rational to buy something after an extreme price appreciation like that, with the assumption that it couldn't possibly go back down? [1] https://i.imgur.com/TeJiCpf.png https://i.imgur.com/TeJiCpf.png

greeneggs 9y ago

> We're not talking about the smartest people here. Something that had a stable (and slowly rising) value for 100 years didn't seem like a gamble until the lobbyists came in and convinced the lawmakers to allow unfair competition. This is not right. It was a bubble. Prices rose from ~$250K in 2001 to over $1.2 million in 2013 [1, 2]. That's a 13% growth rate. It was obviously a bubble. Yet people were jumping on it, taking out big loans to buy more medallions. It had to burst at some point. Uber was the trigger, but this had to blow up at some point. The sooner the better. [1] https://www.bloomberg.com/features/2015-taxi-medallion-king/ https://www.bloomberg.com/features/2015-taxi-medallion-king/ [2] http://www.nyc.gov/html/tlc/downloads/pdf/march_2013_medallion_transfers.pdf http://www.nyc.gov/html/tlc/downloads/pdf/march_2013_medalli...

p0wn 9y ago

They allow non medallion cars aka the black private car service cars but I think you needed a medallion to pick up a person hailing a cab off the side of the road... ie you didn't call the car service to come pick you up. With uber they're still not picking people up that are physically hailing them. They are relying on technology aka smartphones to get around this.

falcolas 9y ago
Personal experience has shown that Ubers will in fact pick up folks who hail them, you just have to then set up the ride via the app afterwards. Found this out while waiting an hour for an uber driver - three others drove by and responded to my waving them down to see if they were my uber, and offered to take me (looking back, I should have taken them up on the offer). This, ironically, turned me on to the taxi system in NY. They were just more reliable at the time.

lazerpants 9y ago

Uber was allowed to operate as a "car service", which was not based on medallions. There were already many non-taxi car services operating in NYC, all Uber did was scale the idea and put it on a smartphone.