A Bailout for NYC Taxis?
In the real life game of paid transportation in New York City, taxi medallion owners have long had an ironclad monopoly. However, with their stranglehold on the market being seriously challenged by free-market services like Uber, Lyft and Gett, taxi bigwigs and their allies in the City Council gathered yesterday for an emergency summit. The meeting was organized by taxi mogul Gene Friedman, who was also sued yesterday morning by New York State Attorney General Eric Schneiderman for failing to pay his drivers. One of the ideas reportedly proposed at the meeting was for the city government to guarantee taxi medallion loans. This would effectively become a bailout for medallion owners, who have seen the value of their medallions plummet in recent years. But the facts make clear that drivers and customers alike are well-served by the new competition in taxi services, and that supporting medallion owners will only advance their own interests, not those of New Yorkers.
The Facts You Need to Know
Economic Disruptor: Last year, taxi medallions were worth $1.3 million per car. Thanks to competition from services like Uber and Lyft, medallion owners have taken a financial hit. But for New Yorkers—especially in Northern Manhattan and the underserved outer-boroughs—more options means lower prices and higher quality. Read more
Looking Out For Drivers: Uber benefits more than just consumers. In NYC, the median income for an Uber driver is $90,000 a year, compared to $30,000 for cab drivers. That’s in part because drivers for Uber and similar services don’t have medallion leases to pay back. Read more
New Employment Opportunities for Women: 14% of Uber drivers are women, nearly double the rate of traditional taxi companies (8%). Read more
Wow More Uber's than Taxis in NYC!! Changing of the guard! Crazy.— Jonathan Cheban (@JonathanCheban) March 18, 2015
The Past is Present
Ending the old system should prove a boon to everyone except medallion owners and the hangers-on who support themselves off this government-created market. Taxi drivers will face a much smaller financial burden, allowing them a decent living at current fares. More stability among drivers will mean more knowledgeable and safer cabbie corps. At the same time, the city will be able to demand more of these drivers in the way of safer, more comfortable cabs, fuller insurance coverage, and more driver training.
On The Calendar
The Alexander Hamilton Award was created by the Manhattan Institute to honor those individuals helping to foster the revitalization of our nation’s cities. This year, the winners are George Kelling, co-author of the Broken Windows Theory, and Eva Moskowitz, Founder and CEO of Success Academy Charter Schools. Click to purchase tickets.
And in other news...
Fines would be comparable to a passenger not wearing a seatbelt in a car that’s not a cab. They would range from $25 to $100.