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> The offer to bail out taxi drivers is an unforeseen twist in the years-long struggle by New York City regulators to contain the explosion of ride-hailing app

> The offer to bail out taxi drivers is an unforeseen twist in the years-long struggle by New York City regulators to contain the explosion of ride-hailing app drivers. City Council members have said they were partly motivated by the plight of taxi medallion owners, who have seen the value of their licenses plummet in recent years in direct correlation to the rise of ride-hailing apps. Six taxi drivers have committed suicide in the last six months, a grim reminder of the human costs of technological disruption. This is such an upsetting characterization of the situation. The city government sold a bunch of medallions to investors/"speculators" (depending on your politics). Those medallions declined in value. Who should bear that loss? The entire situation was created by a government monopoly that never needed to exist in the first place. Now that someone's figured out how to go around it, all the investors in the manufactured, useless regulation are losing their shirts. It's really hard to feel bad for these guys. They were willing participants in a system designed to line their pockets by fleecing ordinary people, choking supply to ensure their prices were kept artificially high. They're basically the OPEC of transportation. Do we feel bad because electric cars are disrupting OPEC? Lyft and Uber really aren't the bad guys here, at all.

ryandrake 8y ago
US, State and local governments seem to have taken on the job of propping up the values of (some) people’s investments and bailing them out when they lose value. See all the crazy things done to keep home prices inflated and the risk-swallowing they did for the financial services industry. All at the people’s expense.
- s17n 8y ago
  Well, in this case the investments were originally sold by the city, based on the promise that the city would use its authority to maintain their scarcity, so I don't think it's unreasonable for the city to offer some kind of bailout.
  - bogomipz 8y ago
    >Well, in this case the investments were originally sold by the city, based on the promise that the city would use its authority to maintain their scarcity .." Where was that promise codified?
    - bbeonx 8y ago
      Oh, don't be coy. That's the whole point of the medallion system.
      - bogomipz 8y ago
        No that is not and has never been "the point" in the medallion system. Perhaps do just a modicum of research before making such false and uninformed assertions: http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_regulationandprosperity.html http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_...
        bbeonx 8y ago
        Yeah man, I read that. I stand by my claim.
- 40acres 8y ago
  Seem to? The entire middle class was built this way. See: FHA, student loans.
  - eldavido 8y ago
    It's interesting that one of these things had a major financial meltdown last decade and the other is well on its way (student loans). Coincidence?
    - dnadler 8y ago
      The fact that there is a lot of student debt does not mean that a meltdown is coming. The housing market crash was so significant because of the amount of leverage that was in the system (and how obfuscated it was). There leverage in the student loan market is much lower for the time being.
  - bogomipz 8y ago
    >"The entire middle class was built this way. FHA and student loans allowed mortgages and higher education to be accessible to more people. This is not the same thing as propping up the value of my degree and my home's valuation in the market place after I have acquired them. The Middle Class in the US was built by former(and other New Deal policies) not the latter.
pteredactyl 8y ago
When will the state start to focus on fixing problems instead of regulating solutions? Their actions are so transparently market friction and corruption. I'm tired of the majority career politicians who have no knowledge of reality other than 'sound good' politics. Companies would be able to build more housing and pay more in wages if they didn't have to grease the government's palms to do anything. They need to go. All of them. Bring back empiricism
- eldavido 8y ago
  Did you vote in the last election? I did.
40acres 8y ago
I think you're being a bit harsh to the individual drivers here. My dad was a yellow cab driver in NYC, lots of drivers, like my dad, were immigrants and owning / renting out a medallion was seen as the equivalent to owning your own home as a nest egg. I totally agree that taxi companies were colluding with government to create regulatory capture that was deservedly busted by innovation, but lots of families have been hurt by the drop in medallion prices. Many drivers have committed suicide. I'm disappointed that NYC didn't take the deal.
- bogomipz 8y ago
  >"I totally agree that taxi companies were colluding with government to create regulatory capture that was deservedly busted by innovation, but lots of families have been hurt by the drop in medallion prices." Why should investing upwards of a million dollars or more in a taxi medallion be treated differently than any other large investment with real risks involved? So when were profits from these medallions those were private but now that there's risk it should be socialized?
  - 40acres 8y ago
    NYC policy is what allowed the medallions to be so artificially inflated in the first place. The city has less medallions today than in the pre-war times. Now that the market collapsed it's the moral thing to do not only to liberalize the medallion restrictions but repay those who were hurt the most.
    - bogomipz 8y ago
      "NYC policy is what allowed the medallions to be so artificially inflated in the first place." You seem to be missing a bit of history. It sounds like you are unaware that the original call for regulation of the taxi industry was by the taxi drivers themselves. Yes, the passage of the Haas act in 1937. During the Depression there were far more drivers than there was demand for taxis. This resulted an abundance of "wildcat" cab drivers who were threatening the livelihood of legitimate taxi drivers.[1][2] >"Now that the market collapsed it's the moral thing to do not only to liberalize the medallion restrictions but repay those who were hurt the most." Lastly the overwhelming majority of medallions are leased out as part of "fleets." The people that have been "hurt" the most have been the drivers who are required to lease the cab for a 12 hour shift for $130 and are also responsible for paying the insurance and gas on top of it. This is basically a feudal system where medallion owners are lords and the actual taxi driver is a serf. [1] https://www.nytimes.com/1996/05/11/nyregion/medallion-limits-stem-from-the-30-s.html https://www.nytimes.com/1996/05/11/nyregion/medallion-limits... [2] http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_regulationandprosperity.html http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_...

ryandrake 8y ago

US, State and local governments seem to have taken on the job of propping up the values of (some) people’s investments and bailing them out when they lose value. See all the crazy things done to keep home prices inflated and the risk-swallowing they did for the financial services industry. All at the people’s expense.

s17n 8y ago
Well, in this case the investments were originally sold by the city, based on the promise that the city would use its authority to maintain their scarcity, so I don't think it's unreasonable for the city to offer some kind of bailout.
- bogomipz 8y ago
  >Well, in this case the investments were originally sold by the city, based on the promise that the city would use its authority to maintain their scarcity .." Where was that promise codified?
  - bbeonx 8y ago
    Oh, don't be coy. That's the whole point of the medallion system.
    - bogomipz 8y ago
      No that is not and has never been "the point" in the medallion system. Perhaps do just a modicum of research before making such false and uninformed assertions: http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_regulationandprosperity.html http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_...
      - bbeonx 8y ago
        Yeah man, I read that. I stand by my claim.
40acres 8y ago
Seem to? The entire middle class was built this way. See: FHA, student loans.
- eldavido 8y ago
  It's interesting that one of these things had a major financial meltdown last decade and the other is well on its way (student loans). Coincidence?
  - dnadler 8y ago
    The fact that there is a lot of student debt does not mean that a meltdown is coming. The housing market crash was so significant because of the amount of leverage that was in the system (and how obfuscated it was). There leverage in the student loan market is much lower for the time being.
- bogomipz 8y ago
  >"The entire middle class was built this way. FHA and student loans allowed mortgages and higher education to be accessible to more people. This is not the same thing as propping up the value of my degree and my home's valuation in the market place after I have acquired them. The Middle Class in the US was built by former(and other New Deal policies) not the latter.

pteredactyl 8y ago

When will the state start to focus on fixing problems instead of regulating solutions? Their actions are so transparently market friction and corruption. I'm tired of the majority career politicians who have no knowledge of reality other than 'sound good' politics. Companies would be able to build more housing and pay more in wages if they didn't have to grease the government's palms to do anything. They need to go. All of them. Bring back empiricism

eldavido 8y ago
Did you vote in the last election? I did.

40acres 8y ago

I think you're being a bit harsh to the individual drivers here. My dad was a yellow cab driver in NYC, lots of drivers, like my dad, were immigrants and owning / renting out a medallion was seen as the equivalent to owning your own home as a nest egg. I totally agree that taxi companies were colluding with government to create regulatory capture that was deservedly busted by innovation, but lots of families have been hurt by the drop in medallion prices. Many drivers have committed suicide. I'm disappointed that NYC didn't take the deal.

bogomipz 8y ago
>"I totally agree that taxi companies were colluding with government to create regulatory capture that was deservedly busted by innovation, but lots of families have been hurt by the drop in medallion prices." Why should investing upwards of a million dollars or more in a taxi medallion be treated differently than any other large investment with real risks involved? So when were profits from these medallions those were private but now that there's risk it should be socialized?
- 40acres 8y ago
  NYC policy is what allowed the medallions to be so artificially inflated in the first place. The city has less medallions today than in the pre-war times. Now that the market collapsed it's the moral thing to do not only to liberalize the medallion restrictions but repay those who were hurt the most.
  - bogomipz 8y ago
    "NYC policy is what allowed the medallions to be so artificially inflated in the first place." You seem to be missing a bit of history. It sounds like you are unaware that the original call for regulation of the taxi industry was by the taxi drivers themselves. Yes, the passage of the Haas act in 1937. During the Depression there were far more drivers than there was demand for taxis. This resulted an abundance of "wildcat" cab drivers who were threatening the livelihood of legitimate taxi drivers.[1][2] >"Now that the market collapsed it's the moral thing to do not only to liberalize the medallion restrictions but repay those who were hurt the most." Lastly the overwhelming majority of medallions are leased out as part of "fleets." The people that have been "hurt" the most have been the drivers who are required to lease the cab for a 12 hour shift for $130 and are also responsible for paying the insurance and gas on top of it. This is basically a feudal system where medallion owners are lords and the actual taxi driver is a serf. [1] https://www.nytimes.com/1996/05/11/nyregion/medallion-limits-stem-from-the-30-s.html https://www.nytimes.com/1996/05/11/nyregion/medallion-limits... [2] http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_regulationandprosperity.html http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_...