Reason.tv: D.C. Taxi Heist – How a New Law Would Screw Drivers and Riders
by Reason TVWashington, D.C. is considering a bill that would require every cab driver in the city to own a special permit called a medallion. The total number of medallions would be capped at 4,000, which would reduce the current number of cabs by more than one-third and put thousands of drivers out of business. (The city government has no idea how many licensed cabs are in the district, though estimates range from 6,500 to 10,000.)
If that weren’t bad enough, most drivers wouldn’t have the option of buying a medallion. The first set of medallions would be offered for sale to the minority of cabbies who have been driving for at least five years and who live in Washington D.C. (Again the city government has no idea how many current drivers meet this criteria, but rising real estate prices and weak city services have led many drivers to leave the district.)
Who will be offered the next set of medallions, according to the bill? That would be cab companies, who could then rent medallions to drivers. This system would destroy the relatively open-access taxi industry in D.C., in which the majority of drivers are owner-operators free to make their own schedules and keep whatever money they earn on the job. In cities such as New York and Boston, drivers pay upwards of $800 a week to rent their medallions.
Cab riders would also suffer under the new regime. Reducing the number of taxis on the street will make it harder to catch a cab, especially in non-tourist neighborhoods and areas far from business districts. And the medallion system will almost certainly drive up prices. A 2010 study by D.C.’s own Department of Finance found that fares in cities with medallion systems are 25 percent higher on average than in cities in which the supply of cabs isn’t restricted.
Given all that, why would the nation’s capital consider implementing such a system? D.C.’s medallion bill was written by lobbyist and former city councilman John Ray, who was hired by taxi magnate Jerry Schaeffer. Ray has worked as a lawyer for councilman Harry Thomas, and it was Thomas who introduced Ray’s bill in the city council. The other major sponsor of the bill: Council member Marion Barry, the former mayor best known for his 1990 arrest for smoking crack in a hotel room with a girlfriend.
In a recent letter in the Washington Post, Ray argued that because the cab industry is open entry and unregulated it’s been susceptible to corruption. But in practice the DC taxi commission, which currently regulates the industry, has its own history of corruption. And the commission is so wary of scrutiny that when reporter Pete Tucker snapped a photo on his cellphone at a recent public meeting he was dragged out and arrested.
Reason.tv Producer Jim Epstein captured Tucker’s arrest on his mobile phone. Later, Epstein was also arrested after resisting attempts by the taxi commission and us park police to confiscate his camera phone. When Tucker was arrested, cab drivers, stormed out of the meeting in protest.
For more on the medallion bill, read Reason’s Sam Staley in the Washington Post on medallions, and on how regulation has spawned corruption in D.C.’s taxi industry.
Produced by Jim Epstein, with help from Kyle Blaine, Lucas Newman, and Jack Gillespie. Narrated by Nick Gillespie.
Approximately 6 minutes.
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21 Comments
Reason.tv Producer Jim Epstein captured Tucker’s arrest on his mobile phone. Later, Epstein was also arrested after resisting attempts by the taxi commission and us park police to confiscate his camera phone.
In other news, sellers of jackboots are making record profits…
"My country tis of thee,….
sweet land of liberty,……..
of thee,……."
I remember.
This is insane…
I love how in the video one of the commission people keeps telling the cab drivers to calm down or else nothing will get resolved.
I'm surprised she didn't have them arrested too….
I am all for anything that makes life in Washington D.C. more painful.
"In a recent letter in the Washington Post, Ray argued that because the cab industry is open entry and unregulated it’s been susceptible to corruption."
And there is NO corruption behind Mr. Ray being financed by taxi magnate Jerry Schaeffer./sarc off
Alright….. one more reason to reject Washington DC…….
In a recent letter in the Washington Post, Ray argued that because the cab industry is open entry and unregulated it’s been susceptible to corruption.
I marvel that some lefties are able to suppress giggles when they tell whoppers like this. Remember when the MSM reporter laughed in Robert Reich's face, when he said we need more government spending? They must be taking some drug to numb their own revulsion of themselves.
Medallion system is a way for rich people with political connections to extort money from those who just want to work.
Anytime you find a medallion system, you will find a corrupt political system.
And to give you an idea how much money is made under the medallion system.
In 2009, a NYC medallion has goes for over $900,000. The lease fee, or the cost of renting the cab to work, is now over $160 per day!
I heard a story that D.C. has a deal with Middle Easterners to give them priority in the taxi & limousine business. Does anyone know what that is about. I'm going to research that now to see what I find. Same deal in NYC with Middle Easterners…………I think it's very dangerous. They should not be driving Americans around. Investigation warranted!
"The first set of medallions would be offered for sale to the minority of cabbies who have been driving for at least five years and who live in Washington D.C" ??????????????????
So women and white men are disqualified? Smells like Hope-n-Change to me.
But…but…but…without laws to tell people what to do, it would be utter chaos? We can't just let people decide on their own how to help others, otherwise there will necessarily be winners and losers! /sarc
Why is it that Progressives can wonder at the spontaneous order of complex ecosystems, but cannot see in the market order an equally wonderous, even beautiful complexity that is no more designed than that found on the lands and in seas of the earth? That people wish to serve others by serving themselves is the fact which confounds Progressives. That in exchange, both parties benefit (otherwise the interaction would not have happened) is brushed aside if it's even acknowledged.
Looks like a thumb-downing monkey just swung through a few minutes ago.
The medallion system is almost union like in how it works,. You can't work unless you pay and if you "own" a medallion, you're pretty much set for life as you'll always have a job, no matter how crappy you do your job. Then there is the corruption that occurs with a medallion system where the biggest payers are the one that gets them while others are locked out.
Reason number 1 million to sucede from the union…let the idiots play around in the north or far west where the progressives live.
Um I think you are reading that sentence wrong. Or maybe you are being funny. But it says that only the cabbies that have driven for at least 5 years will be able to buy them. It doesn't say anything about race, it just says that the number of cabbies that have driven that long are the minority or in other words less than the number that have started driving more recently.
Effing crooks.
Jerry Schaeffer = Wesley Mouch.
Or they just count the cash they are getting out of the deal.
Terrific reporting. Thank you. They're making these men into their slaves. Disgusting!
STOP THE MEDALLION BILL NOW!!!
Now why would the cab companies be given preference? Is it because they can supply lots of kickbacks to the DC politicians? This is another example of how government regulation creates artificial shortages and causes prices to rise artificially. I guess there were just too many people enjoying freedom and the liberals had to put a stop to it.
Right here in our Nation's Capital we've probably got the worst taxi service of any major city in these United States, largely because the regulators, barely regulate — guys who shouldn't have licenses driving vehicles that wouldn't be street legal in Tijuana, etc. The only problem is, now that the D.C. government — which could F-up a cup of coffee — wants to get "more involved" things undoubtedly willl get much, much worse. Repeal Home Rule!
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