Chicago, like many American cities, is broke. So what would be the solution to being broke? Take in more money. For citizens taking in more money means getting a part time job, getting a raise, putting some overtime or just being more fiscally responsible. For government it’s raising taxes.
So, in a typical government solution, Rahm the mayor has proposed a charge on every "shared ride"trip. Reports are that the Uber and Lyft fares will still be lower than a taxicab fare, especially since taxicab fares include the price of the medallion in the figures required to generate an income for the driver.
Regulation is expensive, It enables the city to tax every rider without them realizing they’re being taxed. Chicago, and a host of other cities, generates revenue from ground transportation vehicles by taxing them, taxing the riders and selling medallions. Fees I have generally called the "taxi tax."
Uber has made a substantial business out of skirting those fees and being able to offer a lower price by embracing less regulation, usually at the state level if the cities are too obnoxious.
Rahm, the mayor, has apparently noticed that Uber and their wannabes are increasing their ridership and has made a move to get the city’s share of the Uber passenger pie increase.
Unlike the taxicabs, Uber et al don’t have to beg the city for a fare increase so the increased taxes go directly to the consumer and hardly anybody notices. Can’t get enough good government.
Reports out of New York City are that their recent terrorist attack was by an Uber driver who had also driven a truck. Uber has been under pressure to expand their background checks to include fingerprint searches. However, there is no evidence that any level of background check would have found anything that would have excluded the terrorist from getting a license or denied him the ability to drive for Uber or a taxicab company. I’m sure the "whose driving you" crowd will add this to the list of miscreants, but it could just as easily been a taxicab driver.
The new and improved tax reform proposal has tweaked almost everybody in the country, especially the electric car crowd. If the proposed tax plan passes the electric car subsidy will get cut.
While the 37k Chevy Bolt getting a tax credit up to $7,500 might seem like a good selling point it’s hard to believe that a $100k Tesla buyer is going to be swayed by a tax credit.
The most thought provoking line in the article was a comment
from a GM spokesperson, "Because General Motors believes in an all-electric future, we will work with congress to explore ways to maintain this incentive."
We will work with congress? Let’s run that through the political jive machine. Oh, what that means is they will spend a bunch of money at congressional fundraisers in an effort to get congress to give them some money that congress has already spent twice somewhere else.
If Trump gets his way on the tax rewrite there will be a lot of K Street singing the blues. Almost brings a tear to your eye, doesn’t it?
A report out of New York City is that Ydanis Rodriquez, a former driver and current transportation committee chair, is recommending a bill that will allow medallion owners to operate two vehicles per medallion. While wildly innovative, the plan seems to miss a couple of key points.
First, if ridership is down due to Uber, reported to now have exceeded the number of daily taxi trips, how will doubling the number of taxicabs improve driver income?
Second, where do you park the off duty vehicles.
There are other issues so it will be interesting to see how his plan is received. Perhaps requiring the second vehicle to be wheelchair accessible would sweeten the pie enough to gain some wider support.
Reports are that Uber’s new CEO is geared up to take Uber public sooner than its former CEO had planned. While Kalanick was dragging his feet on going public Khosrowshahi is reported to be more bullish on the idea.
The main sticking point seems to be the old argument of independent contractor versus employee drivers. While they’ve had an adverse ruling in the UK, the US market has made no such ruling.
There have been adverse rulings in California, but not in the courts, only in the labor commission. Should there be a court ruling that Uber drivers were employees then that would most certainly affect the value of the company’s public offering.
Since a variety of drivers work where and when they please, dress how they please and are not controlled by the company, it is hard to see drivers in the US being declared employees.
If Uber drivers were declared employees and it made it past the Supreme Court I’m not sure how taxicab companies could still claim their drivers were independent contractors.
An adverse decision on Uber drivers could have a serious impact on the taxicab companies which Uber seems to be very good at.
Reports are that Chinese mobile payment company Alipay has entered into an agreement with VeriFone to allow Alipay customers traveling to Las Vegas and New York City to use Alipay in taxicabs.
Not all taxicabs in the US take Alipay, some still don’t take credit cards, but these two popular destinations are a start for the taxicab companies.
Uber seems to be a bit ahead of the taxicab world in technology, including payment technology. Oh, did I say a bit? I meant light years. The resistance of taxicab drivers to take credit cards and other non-cash payments is widely known and is most certainly a contributing factor in the rise of Uber.
Cash is certainly king in the taxicab world, but I personally rarely carry more than a few dollars. Like a lot of things in life, our attitude can and does affect our outcomes.
Complaints are a staple of the transportation business. DUI complaints are arguably the most important because they involve the safety of the passenger.
In a reported settlement with the California Public Utilities Commission, Uber has agreed to take their DUI complaints more seriously and suspend drivers accused of DUI until an investigation is conducted. Okay so far.
Uber is reported to be able to consider a driver’s rating and prior complaints before deciding punishment. Really? Even considering allowing a driver to continue that you have caught DUI is insanity.
If a driver is found to be driving impaired and you allow them to participate in future use of the app the legal and public relations liability is greatly magnified.
Imagine a drunk driver, who you’ve allowed to continue after a verified DUI complaint running into a school bus. Got that in your mind? Now imagine yourself sitting on the witness stand explaining your reasoning behind that decision.
The only place for drivers found to be DUI is driving for my competition.
A recent article detailing the recent plunge in the New York City medallion market and its effect on the individual medallion owner/drivers was like ten dozen others. It had some interesting comments from drivers, including one from Yugoslavia, Dragan Lekic.
"America has been a dream for everybody. So, I’m here." A dream for everybody? Yes, everybody except those who are already here. I had the opportunity to go to game six of the American League playoffs between the Yankees and the Astros and got to witness the flag ceremony.
During the game the scoreboard showed pictures of each play as they came to bat with a short bio, including their hometown. It was interesting to see players from all over the world which pointed up the international aspect of baseball, as compared to football.
I found it interesting that only one player in baseball found it necessary to "take a knee" during the season and he was born in the US. It made me realize that there are most certainly people who believe the US to be a special place, just not that many from here.
I personally have “taken a knee” on ever watching NFL football until they all learn how to act. So, boys, while you’re down on your knees you might thank God that you were born or earned your citizenship in the United States of America where at least you won’t get shot for acting like ungrateful elitists.
If you have any comments regarding this or any of my articles please feel free to contact me at: don@mcacres.com. - dmc
