The Lie: Taxi drivers are committing suicide because of competition from rideshare companies like Uber.

The Truth: New York City forced cab drivers to buy limited supply medallions in order to operate a taxi.

This artificially limited the supply of taxis, drove up costs for consumers, and drove up salaries for taxi drivers.

When Uber empowered individuals to earn a living driving without regard for the market-killing regulations, the value of the taxi medallions dropped from $1 million to under $200,000.

Cab drivers who had taken out loans to pay off their million dollar medallion found themselves in financial ruin, owing more on their loan than their medallion was worth. Anyone who planned to sell the medallion to fund their retirement was screwed.

But they weren’t screwed by Uber, they were screwed by New York City. Their terrible financial problems, which are increasing the rate of suicide, are a result of New York City sticking its hands in the economy.

Government intervention into the market always leads to unintended consequences.

The cabbies were fine with these consequences when it protected them from competition and kept the price of taxis artificially high.

But now that technology and competition have delivered a better product to New Yorkers, taxi drivers want more regulation to protect their jobs.

• The New York Taxi Worker Alliance (NYTWA) is calling for New York City Hall to “cap the number of vehicles flooding our streets; create a wage floor for drivers in all sectors….establish fare labor standards for FHV drivers and provide immediate relief to struggling yellow cab owner-drivers,” according to a press release on Monday.
• The NYTWA and Independent Drivers Guild (IDG) are united in wanting more money for drivers, Wired reports: The IDG wants apps to raise the minimum wage by 37%, and the NYTWA wants New York City to raise yellow cab rates.
• Both the NYTWA and IDG want NYC “to cap the number of new entrants, as they worry that demand isn’t keeping pace with increasing supply of drivers,” per Wired.

The Independent Drivers Guild continued:

Until there are living wage rules to protect for-hire vehicle drivers and a halt on new drivers entering the industry, the desperation will continue.

The customer demand is for more drivers to enter the industry. And yet the IDG wants a cap on new drivers in the industry.

I guess the new drivers’ jobs don’t matter. Regulations will protect the old jobs, the established class, and prevent any upstarts from coming onto their turf.

Why does the taxi industry exist again? Is it to provide jobs, or to serve customers?

The customers want a cheaper ride that they can order on their phone.

And there are plenty of people willing to drive them for less than it costs to get a cab.

So I guess the taxi drivers’ skills and services aren’t worth as much as they thought.

Maybe instead of appealing to the government to protect their racket, they should sue the government for losses incurred by being forced to buy a worthless medallion.