Keep D.C. taxis medallion-free

October 1, 2009

If you want to spit in the face of the working class, there are few better options than crossing a picket line. Nothing says, “my need for a hamburger or hotel room is more important than you feeding your family” like ignoring a strike to enter a scab-operated establishment. And yet, every day that unionized D.C. cab drivers strike, District residents cross a picket line just by entering a cab.
D.C. cab drivers started striking last week for a variety of reasons, including the unfairly low rates imposed by the City Council. Taxi drivers in D.C. are still woefully under-compensated when compared to their colleagues in nearby Baltimore or Fairfax.
In June, Councilmember Jim Graham (D-Ward 1) proposed legislation to implement a New York City-style medallion system that would be more detrimental to the quality of D.C. cabs and their drivers.
Under a medallion system, a city issues a restricted number of licenses that permit the operation of cabs.
When the system was invented in New York City, it was supposed to limit the number of cabs and raise the wages of cab drivers.
In practice, however, the medallion system created rent-seeking groups of medallion owners who rent their licenses to actual drivers.
Mandating medallions adds a massive cost to the already capital-intensive business of operating a cab—at New York’s last medallion auction, a medallion for an independently-operated cab went for $413,000.
The medallion system ultimately results in lower wages for drivers and higher prices for customers, since fares must cover medallion rent.
Graham’s quest for medallions has been delayed by the arrest of his chief of staff for allegedly accepting bribes related to medallions. According to The Washington Post, Graham’s chief of staff was allegedly bribed to ensure the passage of medallion legislation and to create exemptions for certain cabs—suggesting that the medallion system is not only ineffective, but also prone to corruption.
Graham has withdrawn his medallion legislation. According to the Post, however, Graham is expected to hold a hearing next month. It’s up to D.C. residents to support cab drivers against legislation that would degrade D.C.’s cab industry for everyone.

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