7 ms·

What you are saying is fine, but that's not why taxi's were regulated, at least in New York. The regulations go back to the depression and were put in place spe

by NoPiece 14y ago

What you are saying is fine, but that's not why taxi's were regulated, at least in New York. The regulations go back to the depression and were put in place specifically to limit competition in order to keep prices high and protect employment of existing cab drivers. The history is right on the NYC gov page: http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_regulationandprosperity.html http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_... -- quoting from the NYC site: "Widespread poverty prompted many New Yorkers to opt for less-expensive forms of transportation, decreasing the demand for taxis. This put many companies out of business and caused many cabdrivers to lose their jobs. The situation was made worse by the tactics of “wildcat” (unlicensed) taxis who used what some considered to be “underhanded tactics,” such as drastically lowering fares, to get more business."

gertef 14y ago
As you wrote: "The situation was made worse by the tactics of “wildcat” (unlicensed) taxis who used what some considered to be “underhanded tactics,” such as drastically lowering fares, to get more business." Protecting a critical industry from market failure is more than just "protecting employment"
- NoPiece 14y ago
  Why would you say that it would lead to market failure? It would have led to more cabs, lower fares, and more jobs (albeit at lower wages). BTW - if it wasn't clear, I didn't write that sentence. I copied and pasted it from the nyc.gov site I linked. I'll edit my post to make it more clear. But I think it important that the regulators themselves are being honest about why the regulations came to be.
kevinskii 14y ago
> The situation was made worse by the tactics of “wildcat” (unlicensed) taxis who used what some considered to be “underhanded tactics,” such as drastically lowering fares, to get more business. Lowering fares to get more business? Oh my. What good could possibly come of such a thing.
- DanBC 14y ago
  If they lower fares by not getting insurance and not maintaining their vehicles it's probably a bad thing.
  - AnthonyMouse 14y ago
    Wouldn't requiring them to carry insurance and maintain their vehicles still be better than government-granted monopolies?
    - untog 14y ago
      Yes, but it's considerably harder to enforce.
    - tptacek 14y ago
      The medallion is what puts teeth on the enforcement of those rules. It's very easy for the owner of a fly-by-night cab company to get new drivers back on the street, perhaps operating under a wholly new LLC with new livery. It's not easy for that owner to get new medallions.
      - AnthonyMouse 14y ago
        That's just treating the medallion as a deposit. If that's the point then why not use an actual deposit and not artificially limit the number that are issued? Or just treat the cab itself as collateral and seize it for any violation that would have caused forfeiture of a medallion? It may not be worth several hundred thousand dollars, but it's certainly worth enough to have to take it seriously.
  - lanstein 14y ago
    see: Fung Wah buses on the East Coast
potatolicious 14y ago
> "who used what some considered to be “underhanded tactics,” such as drastically lowering fares, to get more business." Lower fares is not the only consequence of this type of free market. In NYC we've seen a rise of intercity buses competing at cut-rate prices, and one such bus company recently and spectacularly failed every single safety inspection performed on their vehicles. They also have an accident rate several times that of their less price-sensitive consumers (Greyhound, Amtrak, etc). Free markets often have substantial downsides, it's dishonest to pretend that regulation is strictly driven by parasitic behavior. There are also substantial upsides to commoditization - i.e., gains in efficiency when every consumer does not have to engage in complex analysis of the product on every sale. There is a loss of market confidence when you have to go through a mound of paperwork just to determine which intercity bus line is safe to ride. When a market is over-regulated, such regulation often have legitimate and still-relevant roots. Those who cry for complete deregulation would be wise to figure them out first. Regulations may run amok, but they very often still sit on top of a legitimate need.
- NoPiece 14y ago
  You say, "it's dishonest to pretend that regulation is strictly driven by parasitic behavior," but I was just quoting directly from the nyc.gov site that explains that's exactly why those regulations came to be. You can argue separately for safety regulations, but that's not why NY started to regulate cabs - it was protecting an existing industry from competition. Also, put yourself in the 1935 mindset - was there even auto insurances? were there seat belts? The risk profile people lived with was much different.
  - superuser2 14y ago
    > it was protecting an existing industry from competition Otherwise known as "keeping people employed at a living wage." When the market decides that human labor is worth nothing, it's irresponsible not to contradict it. I will agree that medallions should have gone away after the crisis, but it wasn't "parasitic" at the time.
    - 14y ago
chaz 14y ago
Regardless of origins, I think there's still an important role for city governments to manage the number of cars on the street. NPR Planet Money did a story about the effect of NYC's planned +2,000 cabs (in additional to the existing 13,200) will have on the city: shorter wait times, but longer drive times for everyone. If the story is correct, more deregulation with more cars on the street without other measures (such as congestion pricing) would be bad for the public. NYC traffic is already bad enough. http://www.npr.org/blogs/money/2012/07/31/157477611/does-new-york-city-need-more-taxis http://www.npr.org/blogs/money/2012/07/31/157477611/does-new...
- JackFr 14y ago
  It's far from obvious that demand has outstripped supply. The population of Manhattan was significantly higher in 1937 than it is now 1.9 million vs. 1.6 million. On a population basis it would seem that we would need fewer rather than more cabs. What drives the demand for cabs is the the price of a ride versus the alternative. If the regulated fare is low relative to subways & buses and the overall price level, cabs will be in high demand. If the fare is high, demand for cabs will decline.
  - ericd 14y ago
    You really can't compare the use-per-capita of cabs between 1937 and 2013...
    - JackFr 14y ago
      Why not? An ellipsis isn't an argument.
      - ericd 14y ago
        I thought calling attention to it would be enough. Life, wealth distribution, transportation modes, etc. are very different now than they were 80 years ago. Treating it as a roughly apples to apples comparison is ludicrous.
  - 14y ago
larrys 14y ago
"but that's not why taxi's were regulated, at least in New York." Why does it matter why they were first regulated? It matters just as much why they keep being regulated because the reason can change or morph over time. And even if regulated for the wrong reasons it doesn't mean that in the end there aren't any benefits.
tptacek 14y ago
I'm not sure why it matters what the original impetus behind medallions was. Maybe that means we should have a different regulatory regime more suited to ensuring that every resident of a major metro area has access to safe, efficient taxi transport and less suited towards ensuring a living wage for cab drivers. That's fine. But it's not an argument for no regulation at all. There may be a compelling argument for no regulation. I'm just saying, that's not it.
jbooth 14y ago
I'm just gonna throw this out there, "underhanded tactics" in the depression era were probably quite a bit more underhanded (no scare quotes) than undercutting the competition on price.

by NoPiece 14y ago

gertef 14y ago

As you wrote: "The situation was made worse by the tactics of “wildcat” (unlicensed) taxis who used what some considered to be “underhanded tactics,” such as drastically lowering fares, to get more business." Protecting a critical industry from market failure is more than just "protecting employment"

NoPiece 14y ago
Why would you say that it would lead to market failure? It would have led to more cabs, lower fares, and more jobs (albeit at lower wages). BTW - if it wasn't clear, I didn't write that sentence. I copied and pasted it from the nyc.gov site I linked. I'll edit my post to make it more clear. But I think it important that the regulators themselves are being honest about why the regulations came to be.

kevinskii 14y ago

> The situation was made worse by the tactics of “wildcat” (unlicensed) taxis who used what some considered to be “underhanded tactics,” such as drastically lowering fares, to get more business. Lowering fares to get more business? Oh my. What good could possibly come of such a thing.

DanBC 14y ago
If they lower fares by not getting insurance and not maintaining their vehicles it's probably a bad thing.
- AnthonyMouse 14y ago
  Wouldn't requiring them to carry insurance and maintain their vehicles still be better than government-granted monopolies?
  - untog 14y ago
    Yes, but it's considerably harder to enforce.
  - tptacek 14y ago
    The medallion is what puts teeth on the enforcement of those rules. It's very easy for the owner of a fly-by-night cab company to get new drivers back on the street, perhaps operating under a wholly new LLC with new livery. It's not easy for that owner to get new medallions.
    - AnthonyMouse 14y ago
      That's just treating the medallion as a deposit. If that's the point then why not use an actual deposit and not artificially limit the number that are issued? Or just treat the cab itself as collateral and seize it for any violation that would have caused forfeiture of a medallion? It may not be worth several hundred thousand dollars, but it's certainly worth enough to have to take it seriously.
- lanstein 14y ago
  see: Fung Wah buses on the East Coast

potatolicious 14y ago

> "who used what some considered to be “underhanded tactics,” such as drastically lowering fares, to get more business." Lower fares is not the only consequence of this type of free market. In NYC we've seen a rise of intercity buses competing at cut-rate prices, and one such bus company recently and spectacularly failed every single safety inspection performed on their vehicles. They also have an accident rate several times that of their less price-sensitive consumers (Greyhound, Amtrak, etc). Free markets often have substantial downsides, it's dishonest to pretend that regulation is strictly driven by parasitic behavior. There are also substantial upsides to commoditization - i.e., gains in efficiency when every consumer does not have to engage in complex analysis of the product on every sale. There is a loss of market confidence when you have to go through a mound of paperwork just to determine which intercity bus line is safe to ride. When a market is over-regulated, such regulation often have legitimate and still-relevant roots. Those who cry for complete deregulation would be wise to figure them out first. Regulations may run amok, but they very often still sit on top of a legitimate need.

NoPiece 14y ago
You say, "it's dishonest to pretend that regulation is strictly driven by parasitic behavior," but I was just quoting directly from the nyc.gov site that explains that's exactly why those regulations came to be. You can argue separately for safety regulations, but that's not why NY started to regulate cabs - it was protecting an existing industry from competition. Also, put yourself in the 1935 mindset - was there even auto insurances? were there seat belts? The risk profile people lived with was much different.
- superuser2 14y ago
  > it was protecting an existing industry from competition Otherwise known as "keeping people employed at a living wage." When the market decides that human labor is worth nothing, it's irresponsible not to contradict it. I will agree that medallions should have gone away after the crisis, but it wasn't "parasitic" at the time.
  - 14y ago

chaz 14y ago

Regardless of origins, I think there's still an important role for city governments to manage the number of cars on the street. NPR Planet Money did a story about the effect of NYC's planned +2,000 cabs (in additional to the existing 13,200) will have on the city: shorter wait times, but longer drive times for everyone. If the story is correct, more deregulation with more cars on the street without other measures (such as congestion pricing) would be bad for the public. NYC traffic is already bad enough. http://www.npr.org/blogs/money/2012/07/31/157477611/does-new-york-city-need-more-taxis http://www.npr.org/blogs/money/2012/07/31/157477611/does-new...

JackFr 14y ago
It's far from obvious that demand has outstripped supply. The population of Manhattan was significantly higher in 1937 than it is now 1.9 million vs. 1.6 million. On a population basis it would seem that we would need fewer rather than more cabs. What drives the demand for cabs is the the price of a ride versus the alternative. If the regulated fare is low relative to subways & buses and the overall price level, cabs will be in high demand. If the fare is high, demand for cabs will decline.
- ericd 14y ago
  You really can't compare the use-per-capita of cabs between 1937 and 2013...
  - JackFr 14y ago
    Why not? An ellipsis isn't an argument.
    - ericd 14y ago
      I thought calling attention to it would be enough. Life, wealth distribution, transportation modes, etc. are very different now than they were 80 years ago. Treating it as a roughly apples to apples comparison is ludicrous.
- 14y ago

larrys 14y ago

"but that's not why taxi's were regulated, at least in New York." Why does it matter why they were first regulated? It matters just as much why they keep being regulated because the reason can change or morph over time. And even if regulated for the wrong reasons it doesn't mean that in the end there aren't any benefits.

tptacek 14y ago

I'm not sure why it matters what the original impetus behind medallions was. Maybe that means we should have a different regulatory regime more suited to ensuring that every resident of a major metro area has access to safe, efficient taxi transport and less suited towards ensuring a living wage for cab drivers. That's fine. But it's not an argument for no regulation at all. There may be a compelling argument for no regulation. I'm just saying, that's not it.

jbooth 14y ago

I'm just gonna throw this out there, "underhanded tactics" in the depression era were probably quite a bit more underhanded (no scare quotes) than undercutting the competition on price.