New York City Taxi Alliance Opposes Competition

| by CEI

From their webpage, we see a press release denouncing Mayor Bloomberg’s decision to allow livery cars (limousines, personal hired cars, etc.) to pick up residents outside of Manhattan, in areas that aren’t well-served by taxis or mass transit. From their press release:

We are stunned by the Mayor’s proposal to turn liveries into taxis in the outer boroughs.  Legalizing an illegal activity because it’s been done for so long will immediately cut into fares, especially during the rush hours when yellow cab drivers who live in the outer boroughs pick up fares at the beginning or end of their shifts.  And as liveries bring more riders into Manhattan, what guarantee do we have that the city will stop the illegal activities in Manhattan or the airports?  Already, the city has turned a blind eye on such activity throughout Manhattan and the airports which cuts deep into taxi driver incomes.  This is a slippery slope with long-term implications.  Meanwhile, yellow cab drivers pay between $130 - $190 per SHIFT before they can break even.  EVERY fare counts.   Already, there is increased competition as more taxis are being leased out during this recession with record high number of license holders.

The irony and arrogance makes the rest of the release worth reading. The purpose of the NYC Taxi Alliance is to limit competition in the taxi market thus ensuring higher profits. They complain about how hard it is to make a profit because of the onerous costs imposed on them by the NYC Taxi and License Commission. However, they almost certainly support the idea of taxi-regulation as it allows them to restrict competition. As previously noted, taxi medallions in NYC can run for more than $500,000 — which obviously has huge implications on the profitability of cabs and the unfortunate need for cabbies to work longer hours. Would the Taxi Alliance agree to some form of complete deregulation of taxis in NYC?

Even if they would, it might be too late at this point. This budget (PDF), projected 2011, has revenues of $41 million from fees, medallion sales, and fines. This is insane. The agency doesn’t appear to spend the entirety of its budget meaning they bring in close to $10 million for New York City. These regulations are nothing more than a hidden tax on taxi drivers and citizens who use taxis, one that politicians have little incentive to get rid of. Private regulation would undoubtedly provide safe and reliable taxi service while costing much less.