Is the Globe hurting for op-ed material? Because Christmas Day’s Globe ran an op-ed by former Cambridge mayor and state senator Anthony Galluccio (“a member of the Cambridge Taxi Industry Group,” per the Globe) that not only repeated a bunch of tired anti-Uber arguments that have been around for months, it also asserted a bunch of “facts” that seem suspect – or, at least, he supplied no evidence for them.
Don’t get me wrong – I and others around here and elsewhere have been arguing for years that the regulation of the taxi system is a disaster that desperately needs reform, even as we support Uber’s right to operate in and around Boston. And Galluccio correctly points to two of the taxi system’s more offensive features (“due to regulations, a Cambridge taxi cannot pick up in Boston and vice versa. Absurd, but true.”; and “A taxi medallion owner must finance a medallion for $700,000 or more, the cost of a luxury condo for each cab, just to get it on the road.”), both of which we’ve pointed to before. However:
- Galluccio’s claim that medallions cost $700,000 is out of date and almost certainly too high. A Boston medallion indeed sold for roughly that amount in April of 2014. Since then, however, prices have fallen substantially, and the NY Times reports a taxi industry spokesperson saying that “[w]e hear that there’s a couple of medallion owners that have offered to sell at 425 and nobody’s touched them.” Does the Globe not fact-check op-eds against material that its own paper has reported?
- Galluccio says that Uber is an environmental threat, claiming that “during peak travel hours, as many as 4,000 Ubers sit idling, waiting for a hit on their smart phone. Look around, they are everywhere, burning gas, taking up precious parking spaces, and blocking traffic.” Uh, what? First, Ubers are unmarked, so it’s not clear how you can “look around” and spot them. Second, where did he get his numbers? Third, what is the evidence that Ubers idle more than cabs? I’m sure we’d all like to know answers to any of these questions.
- Galluccio says that “Uber does not want to serve small towns. So if you live in one, and you have always known that a yellow taxi was just a call away, Uber will be ‘airport only,’ seeking out only lucrative fares like those going to Logan, and the taxi will be gone.” I have literally never heard of this issue before reading Galluccio’s op-ed. As far as I know, you can call an Uber if you’re in the service area (which includes lots of small towns), and they’ll take you wherever you want to go. Does anyone else know anything about this being a real problem? Or is this just a taxi industry fantasy?
Strip out the factually dubious assertions, and you’re left with Galluccio’s bottom line, which is this: “Local authorities can and should consider denying Uber and other ride-sharing services livery licenses until the state can address issues of equity, safety, and insurance costs by updating antiquated taxi regulations.” But, of course, this is nonsense – if taxi regulation is the problem, then taxi regulation is what needs to be fixed. Furthermore, it’s nonsense that we and others have been debating for months now (see below for a refresher). Surely, the Globe can do better than to run an op-ed that is both factually challenged and a retread of arguments that have been kicking around for a long time, without even acknowledging that others have raised these exact points before.
Here’s a review some of what’s been said on this topic right here on BMG. Well over two years ago, shortly after the Globe ran its very interesting exposé on abuses within the taxi industry, I noted that it was “hard to see how the medallion system as it exists in Boston serves the interests of anyone other than the medallion owners,” and asked, “why shouldn’t it be scrapped?”
A little over a year later, in June of 2014 when Cambridge proposed (presumably at the behest of the taxi industry) and then had to retract a set of extraordinarily heavy-handed regulations that would have prevented Uber from operating in the city, I wrote:
the taxi medallion system has proven itself a disastrous failure and should be scrapped; GPS-based fare calculations are perfectly reasonable and should be permitted; the city-by-city approach of the taxi business where a Boston-based cab can’t pick up a fare in Cambridge is stupid and should be eliminated; [and] calling a car via a smartphone app is an excellent technological innovation that should be embraced across the industry.
Then, in August of last year, news broke that taxi ridership was way down. Taxi advocates called for regulatory reform – but on Uber, not on the taxi system. Again, this is precisely the wrong approach. I argued then:
Yes, there are regulatory reforms that should be imposed on Uber, Lyft, and similar services. A number of them are already in progress. In particular, background checks and insurance requirements should be uniform across companies that provide rides for hire (and yes, that’s what Uber does, despite its silly insistence that it doesn’t).
But what the taxi industry needs is not for Uber et al. to be regulated out of existence. What the taxi industry needs is to be freed from the yoke of antiquated, oppressive regulation that has failed to keep up with the times (as I’ve been saying for years). Get rid of the medallions. Get rid of town-by-town regulation and the nonsensical rules prohibiting Boston cabs from picking up fares outside city limits. Let taxis compete directly with Uber and Lyft and win back their business, not because the state made life more miserable for everyone, but because they do a better job.
There’s a real role for state regulation in the business of transporting passengers for hire. There are safety and liability issues that need to be taken seriously. But neither the state nor municipalities should be deciding how many cars for hire should be on the road – that is for the market to determine. Nor do I understand the basis for requiring a Boston cab who drops off a fare in, say, Wellesley, to have to drive all the way back to Boston until it can pick up another passenger.
It’s long past time for the state to take over regulation of the taxi industry from cities and towns, to impose uniform rules across the state, and to get rid of measures that no longer work (if they ever did). And it needs to happen soon, before the taxi industry is destroyed.
But what happened? Nothing. There was a big hearing in September, but it focused on what to do about Uber and Lyft. That’s OK as far as it goes – there are reforms that should happen, and there are a couple of proposals bouncing around the legislature. But astoundingly, over two years after the Globe exposed the hideous abuses inherent in the medallion system, and after many months of calls for reform, there has been no serious effort to change regulation of the taxi industry and bring it into the 21st century.
You’d never know that any of this had happened, to read Galluccio’s op-ed. Disappointing.
They’re the cars parked in the bike lane with their double blinkers on. (Usually with an African-American driver, looking at his phone.)
I’ve been biking the same route for years and this has become a safety hazard during the evening commute. On some evenings, especially towards the end of the week, I’ll have to dodge three or four such cars. Trying to get through Harvard Square on a Friday or Saturday night on a bike is just awful. I’ve been nearly hit by an Über going for a “parking spot”. (ie. The lane I’m riding in.)
Plenty of folks stand in the bike lane. Delivery trucks, taxis, ubers, jus’ folks waiting on their friends to emerge from the apartment, spouse waiting for other spouse to return from the 7/11, etc.
It’s a problem, and I wish we had better and more toothy enforcement, but I’m not buying that every vehicle parked in the bike lane with hazard lights on is an uber, African American or other driver.
But I would say most are. Again, I’ve been biking the same route for 8 years. So unless the number of people waiting for their friends has increased dramatically in the last the year or so, it’s mostly the ubers.
… but I think it’s always been pretty Anglicized, originally UberCab which meant the Overcab (like the Overman). I guess you have to decide if they are “better than cabs” or if they will get you “over there …”
In Germany it’s not Über (= over) but Uber (= just another American company).
Actually Marcus I’m glad you gave me the chance to investigate this, now I don’t have to have this beautiful Brahms duet running through my head every time I think of a stupid taxi company …
Über die Berge,
Über die Wellen,
Unter den Gräbern,
Unter den Quellen,
Über Fluten und Seen,
In der Abgründe Steg,
Über Felsen, über Höhen,
Findt Liebe den Weg!
Basically we took Nietzsche’s concept of the Übermensch (over-man, literally) and assumed that sense was the normal sense of the word. But in German it’s just “over”, and has no special significance. Sort of like Führer, which just means “guide”. A tour guide is a “Reiseführer”, with no particular negative connotation.
Nonsense like this is why I stopped reading the Globe (and its affiliated websites like boston.com) several years ago.
The “news” and opinion published in the Globe has had essentially no editorial oversight (including fact-checking) since the fire-sale purchase by Mr. Henry. The Globe is to the Boston Red Sox as a grocery-store newsletter is to the store.
Today’s Boston Globe is literally nothing more than the publicity arm of the Boston Red Sox.
Tom, I think you’re throwing the baby with the bad water.
Do folks pay to get this kind of stuff published, or does former elective office just plain open the door?
As a lobbyist for the cabbies he literally is getting paid to write this drivel. I have no idea why the Globe is publishing it except out of obligation to provide “balanced” coverage.
I would be willing to entertain stricter controls on Uber if we had a reliable point to point transit system that ran late. We don’t. If we had cabs that would operate late, could go from city to city, be called by an app with a fare estimator ahead of time, etc. we don’t. So let’s embrace this innovative transit company (it’s not an app company though!) instead of choking it in the cradle to save a bloated, clouted, and routinely racist dinosaur.
Uber found a loophole and a niche and has been very successful. They should insure their drivers and treat them like employees, otherwise, every driver I’ve talked to has enjoyed the experience, I’ve encountered ex-cabbies who defected since they can control their own car and set their own hours. Fares are transparent and up front.
To save money we have taken red eye flights this trip. I came into Logan on Friday at 1:30am. No cabs in sight, no T going out to Wakefied that hour, no way I’m making my 65 plus parents wake up and drive me, surprisingly no Uber, so Lyft was my only option. At $20 it was a bargain and a life saver. We will be calling them at 3am on Sunday to make our 5am flight back to Chicago, unless Uber is available and cheaper. That’s the free market and innovation economy at work, we should be lightly regulating it only to protect consumers and workers not to protect a dying industry from much needed (and welcome!) competition.
And largely anticipated the Baker solution which seems reasonable enough to me. Insure the drivers and be governed as a transit company. This isn’t rocket science, it’s just embracing common sense and best practices. Something Massachusetts routinely fails to do when special interests get in the way.
FWIW, the only time Uber drivers are not covered by Uber is during the “Gap” between when a driver accepts a request and the passenger is picked up.
That coverage is not offered by any insurer in MA. Uber offers that coverage to its drivers in states where it is available.
There’s not much more ANY private company can do regarding insurance. The state should force companies offering auto insurance in MA to provide gap insurance.
Can Uber not self-insure during that period? That is, post some reasonably sized bond, and should an accident occur during the “gap” Uber itself steps in and covers.
Can it be so?
I’m not sure state law allows that — the state imposes fairly strict regulatory requirements on who is able to write automobile insurance in Massachusetts. Perhaps it’s possible. It seems like a high burden to impose, when the issue is created by the state itself.
Well worth investigating, perhaps one of our attorneys knows the answer.
In MA, as an alternative to purchasing mandatory auto insurance, a driver can post a $10,000 bond with the Sec, of State’s office to cover the cost of an accident. This is an old and little used loophole, but it still exists.
So – every Uber driver should be required to post or deposit the $10,000 as a condition of operations.
I’ve pretty much come around to the view that there’s no reasonable way to keep Uber, Lyft, and whoever else out of town. Nor should we, probably. They invented something new, people love it, it’s (said to be) better service than most cabs.
I’m just not comfortable with the argument that flaws in the medallion system mean we just set it aside (and I know David didn’t say that, but I don’t know how we fix it either).
If this were anything else (drilling rights?), or it involved a more popular or politically protected group than cabdrivers (the Patriots? Public school teachers?), we might see it differently.
I haven’t read Galluccio’s piece (and don’t plan to, life is short), but calling for a temporary ban while the government sorts this out is not a terribly unreasonable position. We’ve had the (flawed) system for many years, and enforced it against other competitors. We don’t owe Oober (I’m tired of giving them free advertising) and Lipht any special favors.
Even if we scrapped the medallion system, we should give the incumbents some notice. I don’t know, 12 months? There may not be a good solution, but I do think the medallion system creates some level of obligation.
At this point they are underwater on these in the same way homeowners suckered into subprime mortgages were. I am not sure what’s the fairest or most rational way to do it, another alternative was to let expand the medallion supply and ease the regulations on cabs so they can be competitive.
The irony is, these monopolistic regulations were put in place by the cab cartels in the first place. All the stuff the Gooch is asking to update are artificial barriers his predecessors lobbies for on behalf of the cab cartels. Can’t pick up in one city or drop in another, can’t hail in certain areas or on a mobile device, medallions being so scarce and expensive, all of these things were features not bugs of the cab cartel. So if they are willing to jettison them in favor of a fighting chance fine, otherwise, this is just asking for more life support, more delaying tactics, and more privileges for their industry embedded into law. Uber and Lyft are two global companies that don’t need to compete here, but I would have been stranded at Logan without either. And it’s something that people of my generation the region is desperate to keep expect as part of what makes their city livable. Killing Uber to save the cabs reeks of old Boston and the parochial backdoor politics that are killing our progress.
This is all city and town policy, by the way – so let the towns debate tax bailouts, not the state. It was the towns who managed medallions in the first place. Propose the bailout to the local tax payers, on a tax override, and see how quickly the bailout idea gets shot down.
And to simply codify the loophole Uber is exploiting without reforming the medallion system would be to repeat the mistake law makers made a century ago with the cab industry. They should all operate under the same standard of regulations for safety, workers rights, and consumer protection.
It would make more sense to bring cabs into the 21st century alongside Uber rather than force Uber back into the 19th or out of the Boston area entirely. The subset of taxi medallion owners who would lose their life savings under this displacement is small enough that a compassionate approach could be feasible. It’s not their fault their parent companies refused to innovate.
We have taxis too. Our medallion system(s) are based on the state law.
So if that is changed or goes – what happens to us? Much Uber driving in Eastham? Or North Adams? Existing taxi regulations prohibit red-lining and provide transportation is areas outside the MBTA and Boston area by requiring taxis to serve these less profitable areas. In some towns, there are specific regualtions – for example, a person with a disability gets a 25% discount on a taxi fare. Will they get that on Uber? Why not?
BTW – if I owned a medallion, I would require a repayment of the medallion from the issuing authority, as taking away my investment is a ‘taking’.
Good luck with that. What’s to stop your community from issuing more medallions — at $20 a pop. They didn’t take away your right to operate, and while your property is now worth less, it’s no different than a community downzoning a part of town in which you own real property, no?
When Curley built the Expressway, he just took houses without compensation in the path of the new road. When they built the tunnel, abutters and owners of property taken had to be compensation because of changes to the eminent domain laws.
The first was cheaper, the second fairer.
The state doesn’t have to compensate medallion owners for the inevitable decrease in value every time they decide to issue more medallions. A medallion is simply a license to operate a cab; the state’s police power easily encompasses this kind of licensure. The “regulatory takings” issue (and that’s what we’re talking about here) is much more complicated than you’re making it sound, and IMHO most likely changing the medallion rules falls comfortably on the “not a taking” side of the line.
David – in reading the discussion, I got the impression that we are talking about abolishing the medallion system so the Uber drivers won’t have to pay for one in order to offer taxi services – which at the end of the day, is what they do. As we all know, the costs are based on artificial scarcity so the government can collect more for them.
Given that the vast majority of the medallions in major cities (Boston, NYC, etc) were issued on the order of 100 years ago, it would seem that the vast majority of financial gain was received not by the city government but rather by the seller of the medallion in subsequent sales.
P.S. Since Uber drivers can’t park in a taxi queue or collect fares hailed at the street, they are not taxis. They’re liveries, only different from traditional black cars in quality of vehicle and responsiveness of scheduling. If you were to point out that the uber vehicles don’t have livery plates, you’re right — and it’s a clear gap IMO. Still, it seems to me the correct comparison from a regulatory basis is to limousines, not taxis.
But I would abolish the limits on the number available, so that anyone who wants to provide the service can get a license to do so, for nominal cost, so long as they meet the other safety/insurance requirements.
Along those same lines, I would abolish price controls, perhaps leaving some requirement that the price be known before the trip.
For the most part, taxi regulations are the poster child of terrible government regulation, which primarily functions to allow rent-seeking by established players, and lots of campaign contributions to politicians in return for the monopoly that allows the rent seeking.
It is an odd situation, in that the value of the medallion/permit is a direct result of an artificial shortage due to industry lobbying. They are now declining in value because Uber et al. are competing, thus decreasing the value of the monopoly.
I can’t think of another situation in which permits/licenses are tradeable on the private market, and used for collateral like this. Liquor licenses, maybe?
In any event, it would certainly be an odd Republican position to require compensation for the beneficiaries of a monopoly created by government regulation, to reimburse the “losses” caused by de-regulation.
As for taxi service to Eastam and North Adams, the local government can continue to issue medallions/permits. If someone can make money by providing that service, the market will ensure that they will. If they can’t, the market will ensure that there is no taxi service in those places.
ie. The guys who bought their own medallions as a way of securing their retirement. They’re extremely few in number, but are always trotted out by the industry as a sympathetic face. As for the holding companies that own the vast majority of them, they don’t need a bailout and shouldn’t get one.
I’m always surprised at Republican resistance to allowing the market to operate freely. It happens with startling frequency.
And end the town by town shenanigans? Maybe make them unlimited and require Uber users to have them as well? It shouldn’t be that difficult to get the cabs to acknowledge their business model is antiquated and no longer deserving of government protection while simultaneously forcing Uber to play by some set of standards and rules governing it as a transit company.
Most US cities don’t use Medallions, but some so. So I’m sure studies have been done on the effect of having medallions on both drivers and passengers. (I don’t actually care about fleet owners — most of them made huge profits on their medallions over the past decade, and continue to bring in outrageous rent on their medallions.)