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The Coastal Packet

The longtime national journal, Progressive Review, has moved its headquarters from Washington DC to Freeport, Maine, where its editor, Sam Smith, has long ties. This is a local edition dealing with Maine news and progressive politics.

9/9/09

Portland airport wants taxi monopoly

Tom Bell, Portland Press Herald - Officials at the Portland International Jetport want to offer a single taxi company an exclusive five-year contract to serve the airport and replace a system in which independent cabs provide service. The officials say the new system would save the airport more than $100,000 a year and improve service. They also say it would be easier to manage taxis if they could make just one call to complain about poor service -- such as overcharging -- rather than figuring out which one of more than four dozen drivers has caused a problem. But the taxi drivers who work at the airport, all of whom are immigrants, say it would be better to reform the current system than abandon it. . . Today, 51 taxis have permits to offer non-reserved service at the airport. Each permit costs $800 a year.

The Portland airport plan is in a long tradition of taxicab monopolization in urban America. The effect won't just be at the airport. If a certain group of cab drivers can't get the airport business they'll have a hard time staying in business at all and the benefits will accrue to one or two large companies as elsewhere. Below are excerpts from an article your editor wrote before leaving Washington for Maine

Sam Smith, Washington History - The recent shift from taxi zones to taxi meters was not just a matter of how fares would be collected: it was a cultural shift as well. Washington's zone system encouraged a large number of drivers to rent or own their own cabs and, in a city heavily weighted towards professional employment, offered an unusual opportunity for lower income residents and immigrants.

A major reason, not often noted, was that under the zone system it was virtually impossible for large corporations to take over the industry. They would have no way of knowing how much an individual driver was truly making. Thus they avoided the city.

A Department of Justice study in the 1990s found that 87 percent of some 100 cities with taxi service restricted entry in some way. Around the same time, Chip Mellor of the Institute for Justice noted that Denver had routinely turned down every application for a new taxicab company from 1947 on. Chicago and LA were closed. Boston’s permit cost $60,000 and New York’s $140,000.

Without such restrictions or medallions, DC's industry flourished, reaching 8,000 cabs by 1994, more cabs than any other city in America. If all of DC’s cabs had been owned by one company, the firm would have been the city’s largest private employer. A study I did at that time found that if DC had as few cabs per capita as Paris or London, our fleet would drop more than 90%. While DC had one cab for every 75 citizens, New York City had only one for every 600. There is almost an iron law of non-competition in the taxi industry. It dates back at least to 1636, when the owners of Thames water taxis got King Charles I to restrict the number of horse-drawn hacks to 50 in order to cut down on the land-borne competition.

My wife, local historian Kathryn Schneider Smith, found in studying the estate records of DC free blacks in the early 19th century that typically the most successful trade was that of a hack driver. Among the reasons: ownership of one’s means of livelihood, a business relationship with the white community, and relief from some of the black codes -- the city’s apartheid-type rules that among other things set a curfew on blacks.

When blacks moved into the city in large numbers in the 1950s, it became common to find cabs providing a first or second job for new arrivals trying to gain a foothold on the economic ladder. The cab in front of a newly black-owned home was a symbol of the taxi’s importance in giving economic substance to the promise of civil rights. Later, one could similarly follow the immigrant trend just by riding enough cabs.

There are no signs whether the city plans further changes in the system such as encouraging its takeover by a few corporations, But according to Michael Neibauer in the DC Examiner, the taxi commission "has not licensed any new cab operators since 2005, when the driver's test was abruptly withdrawn after the answers were released to the streets. Roughly 2,000 people have since taken the $375, 60-hour training course at the University of the District of Columbia, but have been unable to get a taxicab license."

Though we still have more cabs per capita than most places, the number of cabs is down almost 20% from the mid 1990s. And we do know that a unique opening for upward mobility is no longer quite as wide as it once was.

1 Comments:

Anonymous Anonymous said...

Well this city (Portland ME) has flooded the industry so bad that the 150 taxi drivers and owners can hardly make a living.Although our current city council menbers care less about us,isnt it obvious they only want our licence fees of 400.00 a year.Stop issueing taxi business licences. Im concidering a class action lawsuite against the city of Portland and many if not all in the taxi industry will follow suite with me

September 17, 2009 8:02 AM  

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