New York’s Latest Uber Assault

Mayor de Blasio and the City Council try to rescue the taxi cartel.


Taxi drivers hold a protest in front of City Hall in support of a proposed City Council vote on a 12-month cap of For Hire Vehicles in New York City, July 31.
Taxi drivers hold a protest in front of City Hall in support of a proposed City Council vote on a 12-month cap of For Hire Vehicles in New York City, July 31. PHOTO: SPENCER PLATT/GETTY IMAGES

The New York City Council’s efforts to cripple Uber and Lyft are beginning to resemble Donald Trump’s obsession with Amazon, with more pernicious results. The City Council will vote Wednesday on a one-year moratorium on new for-hire vehicle licenses, which supporters say will give allow time to study the industry. In reality, this “cap” will be as interminable as the city’s subway delays.

Council members complain that the number of for-hire vehicles on the roads, including app-based ride hailing services like Uber and Lyft, have soared to more than 100,000 vehicles from 63,000 in 2015. But there are only 13,000 yellow cabs in the city, and the taxi cartel is seeking the council’s protection.

Traffic congestion is a problem in Manhattan’s business district as New York ers look to escape the subway’s 70,000 delays a month, and New York Gov. Andrew Cuomo earlier this year proposed charging drivers more to enter the city’s business core. But Mayor Bill de Blasio and state legislators from the suburbs balked at this market-based congestion pricing, and instead they imposed a tax on ride-hailing services south of Manhattan’s 96th Street for subway triage.

The mayor and the City Council’s progressives still aren’t assuaged. In 2015 Mr. de Blasio floated a cap on new for-hire vehicles but backed down after a public outcry. He now hopes to exploit Uber’s recent regulatory travails and stories of taxi-driver suicides to limit for-hire vehicles, rejecting an offer by Uber, Lyft and Via of a $100 million for taxi drivers.

A one-year freeze on app-based drivers may sound benign. But driver turnover is high since many sign up when they’re between jobs or need extra cash. Lyft estimates the annual industry churn is at least 25% with new drivers enticed by high demand when the supply of drivers decreases. Under the City Council’s bill, the one driver in four who quits at some point next year won’t be replaced, resulting in longer wait times and higher fees in the face of unmet demand.

Fewer for-hire cars will hit New Yorkers in the outer boroughs the hardest. Unlike yellow cabs, which predominate in dense Manhattan, app-based rides are a lifeline for people in the Bronx and Queens. More than 60% of Uber trips—excluding those at airports—begin outside Manhattan’s business district, while 80% of Lyft rides start or end in the outer boroughs, according to the companies.

Even civil-rights groups and Rev. Al Sharpton oppose the for-hire cap. The New York Urban League and the state’s NAACP note how hard it once was for minorities to hail a yellow cab or get a return taxi to the Bronx. Most for-hire vehicles are hailed via smartphone, so drivers can’t easily discriminate.

Uber tallies how many times drivers cancel rides, and drivers aren’t notified of a passenger’s destination until the pickup is confirmed electronically. The City Council has paid lip service to these concerns by establishing a new Office of Inclusion to investigate discrimination by taxis and for-hire vehicles. You can bet the Council will use this agency to bludgeon ride-hailing companies.

New York City last restricted ride services in 1937 by limiting the number of taxi medallions. The cap barely budged even as fares rose and the value of medallions topped $1.3 million. With for-hire apps, the cartel finally has competition. Leave it to New York’s ruling progressives to try to kill the best news for city transportation in decades.

Appeared in the August 8, 2018, print edition.

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