PURE CRONYISM: After London Bans Uber, New York Weighs Limits to Help Cabbies

The Uber bans are nothing but crony capitalism. Straight up, obvious, not complicated, crony capitalism. A vested interest (taxis) want the government to save them from a better solution that has evolved out of the market. (Uber, Lyft, etc.) In the process the public is shafted of course.

The complaint from the taxis, or more accurately their argument, is that Uber isn’t subject to the same insurance regs and so on that they are. But you will notice that there isn’t any call to reduce taxi regulations so that the taxis could at least compete. No, the taxis want the regulations because these regulations were crafted for them and by them in the first place. The regulations, they thought, would provide a barrier to entry. The taxis are just mad that Uber went around them. They are mad that their monopoly was broken. (The market is good at doing that if the state doesn’t get in the way.)

This is thug politics and so it should be no surprise that we see it in London and New York.

(From Bloomberg)

The last attempt at regulating the mobile ride-hailing companies ended badly for Mayor Bill de Blasio, who failed to limit the vehicles’ increasing presence on Manhattan’s clogged streets. The mayor backed down after Uber ran a multi-million-dollar television and social-media ad campaign that accused him of taking jobs from cab-driving immigrants, whom the mayor has considered part of his political base.

Taxi license owners also count themselves as losers and victims of Uber’s rise. Medallion Financial Corp., a public company specializing in taxi-medallion financing, has seen its stock drop to $2.13 Monday from a high of $17.74 in November 2013. Last month, MGPE Inc., a hedge fund, bought 46 medallions out of foreclosure for about $200,000 each including fees, according to Medallion Financial President Andrew Murstein. That’s down from an all-time high of about $1.3 million four years ago, Murstein said.

Yellow cab operators are subject to the city’s Taxi and Limousine Commission regulations governing driver qualifications and cab operations. That includes prohibitions on phone use, which don’t apply to electronic-hail drivers. While yellow cabs are restricted to about 13,600 in New York City, there’s no limit on how many Uber and Lyft cars may cruise city streets.

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