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INDUSTRY IN REVIEWBy Don McCurdyWhere's the line? The saga of Mile High Cab has been settled. The Colorado Public Utilities Commission has allowed them to exist. Yeah, but only after the Colorado Supreme Court demanded that they reconsider the case. So, now that we've worked all that out, the question I have is what constitutes regulation? Has government regulations simply become a protection racket? Well, yes, at least in the case of Mile High Cab. The Colorado PUC is a classic example of government not only stifling business, free enterprise and competition, but also an example of the arbitrary nature of some regulations. The same PUC that denied Mile High new permits, turned right around and granted new permits to existing companies. Do they simply not grasp how the industry and economics work? Limiting the number of companies may make it easier to "regulate" the industry, but it also limits a driver's options as to where he/she can work and how much he/she will have to pay for the "right" to work. So, I would ask the question of my regulator friends, okay, I don't have any regulator friends,however, in any event, when does regulation become oppression or even restraint of trade? Is the public need served by these types of actions? I think not. Now, the needs of the companies to be able to operate inefficiently and charge higher than necessary lease fees might be served, but not the needs of the riding public. Who is the PUC, or any other regulatory agency trying to protect? When asked, regulators puff up with the idea that they "protect" the public, but their actions don't support that contention. Are advertising screens necessary to the riding public or simply another cost to the driver in fees, lost power consumption? Competition is the backbone of efficient business. Business owners can get fat and lazy when they have the government protecting them from competition which is clearly the case in the Mile High saga. Who watches these people? Well apparently the Institute For Justice does, and kudos to them for assisting Mile High in overcoming government.
For several decades, New York City cabs have had to have partitions, those "bullet resistant" shields between the passenger and the driver. Some have window, sometimes referred to as "weapons access holes", some are solid. All are face resistant. There's probably no truth to the rumor that the New York Regional Society of Plastic Surgeons paid to have them installed, but I digress. It has turned out that taxicabs have not been crash tested with the shields in them, only before the shields were put in them. This has never been a problem until it was discovered that the "Taxi Of Tomorrow" (TOT) was crash tested with the shield. Now that this revelation has come to light the safety of the drivers and the riding public has surged in importance. Now, after all these decades, it's been determined that not testing the taxicabs after the shield is installed is unsafe. Well, what a surprise. You might ask yourself, how has this dangerous safety violation escaped the attention of the ever vigilant Taxi and Limousine Commission? Well, the reality of the situation is that it was never deemed important until nobody wanted the TOT (Taxi of Tomorrow). So, to bypass the whiners in the industry the ever clever outgoing mayor, Michael "what term limits" Bloomberg, dreamed up the "danger" so that the TLC could spring into action and right this wrong, defend the safety of the riding public, save the lives of the downtrodden huddled masses driving to be free! Kinda brings a tear to your eye doesn't it? Don't laugh, Mike is right now spending more money than most of you will ever make trying to take away your rights. The moral of our story? Politicians will ram what's good for you down your throat even if it kills you. Maybe I was wrong, this guy looks more presidential every day.
Recently, a settlement was reached between New York City and Taxis for All and other groups. Fifty percent of NYC taxicabs will be wheelchair accessible by 2020. The agreement covers everything except who pays for the conversion of the vehicles. While both groups in the suit agree that it's a wonderful agreement and will move the city forward to a greater tomorrow neither is stepping up with who or how the bill gets paid. Interestingly, neither of the parties to the agreement have any financial interest in the industry which seems to be becoming a common theme - let me help you spend your money. As to who will actually end up paying that is of course a given, the taxicab riders. No, not the the special accessible cabs, that would be illegal, but all taxicab riders. Somewhere down the road there will be a calculation made as to the cost, but when your medallion costs a million dollars, fifteen thousand seems a bit like chump change. While it is interesting that they've come up with a "solution" it is equally as interesting that the 2,000 new accessible medallions are deemed not enough to cover the 90,000 wheelchair users estimated to live in NYC. Having dealt with customer to taxicab ratios in the past in the range of 1200 to 1500 passenger per taxicab, one taxicab for each forty five potential passengers seems like major overkill. Factor in the rest of the fleet and you would come up with a ratio closer to one taxicab for each twelve potential passengers. I can see the idea that a medallion purchased with the knowledge that it was only allowed to be used on an accessible taxicab should only be used on accessible taxicabs, but to say to a fleet owner that the medallion he purchased, however long ago, must now only be used on accessible taxicabs is a bit arbitrary, especially when the extent of the "problem" cannot be determined until after the 2,000 new accessible medallions hit the street. It would seem prudent to me to put the 2,000 accessible medallions on the street first, assess the service level and then decide if it's necessary to spend eighty two million to solve the problem if a problem exists. I would be surprised if there wasn't a lawsuit waiting to happen here.
It would appear that the Milwaukee Common Council may possibly lack some common sense. Having a cap on the number of permits for taxicabs was ruled unconstitutional by a Wisconsin judge last spring. The council's response was to raise the cap. Huh? If having a cap is unconstitutional then how is having a higher cap not unconstitutional? I'm not a judge, and some would say that's a good thing, but it seems like a contempt of court situation to me. Now, I can't say for every judge, but some of the judges I've met got downright cranky when you ignored their rulings. It will be interesting to see what happens.
It seems there's an issue with getting taxicabs signed up for credit cards in DC. Didn't I just write this? Well, the problem now as expressed by a local blogger, is that the credit card companies are having a hard time getting approved by the city. Huh? Why is the city involved in who private business uses to process their credit cards? Well, it's the taxicab business that's why. Huh? The city wants to wet their beak that's all. The judge threw out their plan to have just one processor so now they're having trouble figuring out how to get their piece of the action. Any driver can sign up with "The Square" to process their credit cards, do it over the phone and not have some card equipment sucking up power constantly. Why not do that? Too simple. It has to be complicated so there's a way for shenanigans, some free dinners from potential vendors, some brother-in-law deals and some "side deals." How much graft has to go on before the public throws the bums out? Nobody knows, we haven't hit that level yet. Every license, approval, ordinance or "new idea" offers an opportunity to the regulators to make new friends. Sometimes it's just more obvious than others.
Rumors are flying about that Uber is getting into the vehicle for hire business as a company owner. That is, actually getting vehicles of their own. If the figures being bandied about regarding their net worth are accurate I would have to wonder why they would? Don't get me wrong, the industry is screaming for a nationwide company to provide a serious product that can be relied upon to get you where you're going without having to learn new languages, but why bother if what you're doing is working well? All along my thought on how they would be successful would hinge on quality of service. Too often the end product of a transportation service is dependent on whether the driver pays his lease on time rather than the number of problems he/she create. Uber has obviously satisfied somebody. If Uber can get into enough markets without paying exorbitant fees for medallions or permits it might make good financial sense. Steps taken to promote "exclusivity" could end up in the minefield of the employee independent contractor if not handled well. Drivers, free to get their own business from a variety of providers, are more easily shown to be independent contractors. Having seen new startups done a variety of ways, it will be an entertaining situation to observe. Would I be somewhat paranoid if I mentioned that "leaking" unofficial financial information seemed just a little convenient? But, that's just me.
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