[quote=“wysinwyg, post:26, topic:35988, full:true”]
“Plenty”. Taxis, Lyft, public transport. That’s three. Is that plenty?[/quote]
Sidecar, RelayRides, GetTaxi. ZipCar. Car2Go. Enterprise CarShare. Literally hundreds of small transportation companies of one stripe or another. Do I need to go on?
Really? What evidence does the author present for that argument? In fact, he clearly understands the problem with the taxi market:
Does he offer any indication whatsoever that Uber is pursuing the same strategy? Or any strategy at all to block new entrants to the market? Are you considering surge pricing as evidence of predatory pricing? In fact, the only evidence he offers of Uber trying to set itself up as a gatekeeper is … the Amazon/Hachette pricing dispute, which is about as bad of an example as you can get. He then describes competition between Lyft and Uber as a “price war”, when it is really evidence of the market working as designed. And he even admits that Uber doesn’t even have leverage like DRM to lock passengers into its service. And from that, he jumps straight to “when Uber controls the market” FUD, without ever describing how Uber could possibly get there. Like I said, rubbish.
(1) Get to know your local elected officials and the members of the taxi commissions. They are good people trying their best to do a thankless job. Try to thank them whenever you get the chance, and remember, it isn’t always the thought that counts.
(2) Need protection from regulators who want to shut you down? Ask around your town and see if there are any consultants who specialize in providing protection. In most cities with a medallion system there are firms that have been working in this field for decades. Capisce??
Both these methods have proven successful for the medallion owners and I see no reason why they won’t work for you.
Keep the existing licensing, safety, and insurance requirements in force for all vehicles for hire. Yellow cabs, Uber, anyone else.
But sell an numbered annual sticker, clearly visible to passengers, for $100/car to anyone who provides drivers and vehicles which meet those requirements.
The only group that does not benefit by this is those who have “invested in” million-dollar medallions and who believe it’s the government’s duty to protect their “business model”. And seriously, fuck them with a tire iron.
In D.C.'s case, it looks like a case of massive regulatory capture–compounded by grotesque arrogance on the part of the captured regulators. For decades, the D.C. Taxi Commissioned tolerated decrepit vehicles and widespread abuse of the zone system–which I got to know well, living on a zone boundary where I was almost always charged a two-zone fare when the rules said I should only pay one. And the DCTC’s occupants apparently felt as entitled as the drivers; in 1996, the Post found that the chair held driver’s licenses in both D.C. and Maryland, and her response was “hey, arrest me.”
Surely the “barrier to entry is low” for another auto company to compete with the Ford Motor corporate. Henry Ford started his auto business as a side-project while employed as an engineer (at Edison labs; by analogy, the same plucky spirit is currently employed at Google or Amazon). After all, there’s nothing preventing another person from doing what he did and starting in their spare time – there’s the same low costs!
No, you just (if you want to operate within the law) either need to be extraordinarily wealthy or have a wealthy backer. That is pretty much the only requirement - Cab Medallions are for rich and well-connected people only (although sometimes they will let a poor person drive it and earn money for them! Sometimes, a few not-so-well-off people might even band together and do it on their own, though that is getting harder and hard to pull off in many places since that’s against the intent of the rules)
This is such a critical point in this, and many discussions that somehow never seems to be made. I’ve been having this conversation about socialism with a lot of people lately, people considering changing careers but crippled by the fear of moving into a different field, despite the fact that that their skills and talents could be put to better use elsewhere. People tend to imagine that socialism is just an expansion of the power of the dysfunctional individual unions that exist in the U.S, where things like lifetime tenure for (mostly great, but occasionally very, very bad) teachers, and medallion systems for cab drivers, and the preservation of jobs at the expense of streamlining production are the only “wins” for their constituencies that unions can manage. The shape of unions and union actions and efforts are guided by the incredibly dysfunctional system they act in, and are not inherent in the nature of strong labor. True labor unions do not represent an individual industry, competing for protection against other industries. They also don’t have to prop up dying, inefficient industries and processes in order to keep their members and workers off the street. When there is true protection and support for working people as a whole, as you say, they have the freedom and flexibility to be employed where they are most useful, most effective, and most needed. This doesn’t remove the incentive for wealthy people to try to capture regulatory structures for their own enrichment, as is a problem in this case, but it removes the idea that protectionism in a single industry, like medallions for cabs, are somehow a protection of individual workers.
There are probably treatises on this, but it’s a combination of organized crime (past and maybe present), oppression of minority/ethnic groups, and the size of American metro areas compared to those in many UK and Continental cities.
The slightly longer explanation is that by setting up cab commissions that enforce scarcity and have huge rewards for winning bidders for licenses (medallions), the possibility of corruption is vast, and it happens all the time. Further, the cab owners rake so much money off the backs of drivers, a good percentage of whom have few other similar economic opportunities and (in the past) were undocumented workers paid in cash, that they are an effective local political lobby against change.
So forced scarcity, a climate of either or both corruption and power madness, and regions that can span hundreds of square miles that cabs must serve? Big problems. Uber et al. break the scarcity problem, which lessens the cartels’ powers and reduces the value of the medallions (which cost well over $1 million in NY now), and put more control and money in the hands of drivers. But Uber also can ban drivers for little or no cause as drivers aren’t employees and also aren’t subject to laws that protect licensed cab drivers.
This was a joke! I guess sarcasm doesn’t play. The typical view of socialism is that merit has no value, and I was playing with Silicon Valley’s inflated notion that merit is all that one can rely on (and that merit is correctly recognized).
Was Elon Musk employed by PayPal, or did he own it?
There’s a big difference in starting a niche-company (electric cars sold to a specialty market vs., mass-market automobiles) when you have plenty of money to burn, vs. starting up with close-to-zero-capital.
If you wanted to compete with Facebook today, you can’t start in your dorm room, because you have to compete with Facebook. If you want to compete with Uber today, you can’t start in your garage – because you have to compete with Uber.
Sorry for missing the joke - one gets used to a very warped view of socialism from the USA!
But back to the main issue, do I understand correctly that the US system is based on an auction for a limited number of licences / medallions? I can see that becoming quite corrupt when you have wealthy businesses bidding in a small pool!
By contrast our regulation here imposes a modest financial hurdle (the biggest is actually the requirement to have a modern fully serviced, moderately large vehicle that satisfies the pollution regs. https://www.cambridge.gov.uk/become-a-taxi-driver
The council has limited the number of licenses in the past and (particularly for Hackney carriages) there is occasionally a secondary market in badges. But the council tends to stamp that out and wants to licence drivers directly.
And to reverse the joke, perhaps auctioning in a free market is too capitalist a solution that results in corruption
I would like to add that uber has another big problem, if you ask for an Uber somewhere a little bit farther than the “normal” the driver can refuse the ride and you cannot even rate the driver for not giving you any service. So you’re basically F…
I don’t even have access to witch driver has made me and my family almost loose an airplane. I guess it was my error in trusting something new and shiny.
Yeah, this was kinda my question too…the topic of “I can’t get a cab in Brooklyn” being an argument for Uber rung kinda false for me. In a totally open market, what is the incentive for Uber drivers to operate in markets that even cabs don’t want to travel in? Has this been shown to be demonstrably true, that they do spread out to the hinterboroughs? better than the new, green “outer borough” cabs?
I don’t know how every U.S. city/regional market works, but in the major cities, that’s the case. The history involves a lot of organized crime and fraud, of course! And medallions can be sold and transferred in many places. I believe two went for over $2 million as a set in New York recently.
The argument behind this licensing is that it makes cabs too valuable to be idle, providing an incentive (coupled with fixed rates set by a local commission or regulator) to have some cabs on the rode all the time.
Uber etc. flips that providing only financial incentives rather than exclusivity. So all drivers compete with one another, but the demand has so far not seemingly exceeded driver supply, hence Uber’s use of surge pricing.
Uber gives drivers intelligence about where people are trying to get rides, and drivers are obliged under Uber’s rules to take people anywhere in the service area, as I understand it. (This may not be a legal requirement, because they aren’t operating as cabs in UberX and Uber Black, but I believe a driver refusing to go to a destination could easily be knocked out of Uber’s system.)
As a result you have Uber drivers winding up all over and then looking for fares to take them back to other places. Uber drivers will cluster were there are the most fares waiting, but they may also know they are more likely to get a fare in a less-popular but still busy area.
