One time, not too long ago, my wife asked me what my favorite holiday was.  I was stymied.  I had never really given it much thought, so I quickly changed the subject to how badly the children were behaving--always a great topic to discuss especially when you're about to say something asinine about Christmas shopping in the middle of Christmas shopping.
So the subject of favorite holidays lay dormant in the back of my mind until late last night when it suddenly hit me:  MLK Day is positively the BEST holiday ever!
Think about it: No wife crying that you forgot MLK Day again. No shopping at crowded malls.  No picking out the wrong gift and getting glared at.  No MLK lights to hang up.  No whiny little kids asking if MLK really exists or if he is just your dad.  No Civil Rights tree hung with goofy plastic doo-dads. No huge MLK parties.  No staying out all night running drunks around in the taxi.  No all night TV show hosted by some guy who should have died long ago, and highlighted by a large dropping MLK ball in the heart of the worst neighborhood in New York. No pulling MLK out of a hole in the ground to see if he sees his shadow. No green beer.  No traditional car race.  Absolutely, positively no standing around in a crowd of people on a blazing hot summer night watching a lame-ass fireworks show paid for by your stolen tax dollars.  No camping.  No drunken idiots dressed like vampires, werewolves, or zombies.  No running around drunks in the taxi.  No cooking.  No watching overpaid prima-donna gladiators contest things on a "grid iron". No parades of military equipment tying up traffic. None of that stuff! 
Just a quiet day of celebrating the life of a guy who said wouldn't it be nice to treat other people decent for a change. And the lying politicians and thieving bankers take the day off too!
What could possibly be better?

Oh, the holiday traveling season is upon us!  And with it, comes all the hazards of travel.  One of the ones that simply did not exist up to just a few years ago was the possibilities of our fine public servants at the TSA (Transportation Security Administration) pilfering your stuff out of your luggage while searching for bombs and other contraband. 

According to one article, “Overall, nearly 400 TSA (Thousands Standing Around) employees were fired for theft between the years 2002 and 2011”.

These are the ones that they caught, and disciplined by firing.  How many more have not been caught yet, or whom just received a slap on the wrist, God only knows.  A former agent who was busted for theft  totaling some $200,000 per year called it a "culture" of indifference that allowed corrupt employees to prey on passengers' luggage and personal belongings with impunity.  (Pythias Brown got 3 years in prison for stealing more than $800,000 worth of stuff, or $266,666 per year.  Hell, I’ll spend a year in the slammer for a quarter mil.)

Most popular items to be stolen are high dollar, and easily concealable electronic items. 

Agents will also remove innocuous think they might be dangerous.   A case in point was a passenger I had in my taxi a few weeks back.  He had me take him to Walgreen’s to get a prescription filled.  Enroute, he told me that he was on heart medication, and the wonderful people at TSA (Terminally Stupid Assholes) removed his meds from his checked bags.  Apparently, they can’t tell nitroglycerin tablets from nitroglycerin explosives.  (“Ok, everybody! I’m a desperate man!!  Take this plane to Cuba, or I’ll swallow all these nitroglycerin tablets at one time and blow us all to Hell!”  “I think he means it, man!!”) The pills were still in the bottles with the medication labels still on them. 

Another man I had as a passenger was on a business trip, and had some nicely printed and bound brochures for a business meeting.  The totally awesome and completely competent agents from TSA (Trashes Stuff on Airlines) cut open the wrapping on what were clearly booklets, then courteously taped them back together.  The tape totally destroyed the covers on the booklets, and my passenger had to spend several valuable hours getting them recovered. 

This is in addition to getting your genitals groped at the gates by those ever so polite and kind agents from TSA (Thieves and Sexual Assailants).  While I can’t do much about stopping one of the boys in blue from getting to second base with you, I had an idea about how to prevent your belongings to arrive to your destination, without being damaged.

I had heard a rumor, so I checked it out when I was at the airport waiting for a passenger.  I walked into the baggage resolution office for Delta Airlines.  It’s a quiet little office where several customer service staff try to locate lost baggage, among other tasks.  The woman behind the counter was older, about 60 I would guess.  She looked like she had years of experience behind the desk.  She looked up at me, and said, “May I help you?”

“Yes, ma’am, “ I began,  telling her the story I had made up a few minutes before.  “I am traveling to North Carolina in a few weeks, and my brother and I are going to be in a shooting match, so I have to bring my handgun with me.  Can you tell me the proper procedure?  I mean obviously, I can’t carry it in the carryon baggage.”

Her eyes brightened at the prospect of helping someone with a question.  She smiled, and told me that the weapon had to go in my checked baggage. 

“The gun has to be in a proper gun case.  And the weapon can’t be loaded.  No bullets in it.”

She smiled again.  “Any bullets have to be separate from the gun, and in their own case.   Then, you have to bring the bag over to the TSA officer, and they inspect the bag in front of you.”

“So, they open up the bag in front of me, and inspect it?”

“Yes.” She said. 

“And then what?”

“Then they fill out a declaration form, and close up the bag, and seal it.”

“And no one else opens it before I reach my destination?”

“That is correct,” she assured me. 

 So that’s the secret.  Simply carry a gun in your checked luggage along with your valuables.  Since the TSA agent will be forced by his own procedures to inspect the bag in front of you, you will be assured that your valuables won’t be smashed, or pilfered.  And since their procedures state that the bag is to be sealed, and not reopened, no other TSA agent will get access to your valuables. 

Update: I sent the URL of this blogpost to Lew Rockwell of LewRockwell.com, the best libertarian website on the intertubes, since the subject matter seemed to be right up their alley.  Perhaps they would want to post it there.  Mr. Rockwell  graciously andswered my email query back a few hours later with a very pertainent question:  "Sounds great, but you have to be flying someplace you can carry a gun, right?"  

Of course, he is right.  So if you decide to carry a firearm in your checked bag, make sure of the laws where you are going.  

I thought about it for a bit.  We cab drivers can get very creative sometimes.  I placed a quick phone call to the lovely people over at Southwest Airlines.

"Hey, Im going out of town, and I'm bringing a toy gun for my little cousin.  Now, I know I can't carry it in my carry on bag, and it has to be checked.  But do I still have to fill out one of those firearm declaration pages for the TSA?"

"Yes you do, sir."

"And they still go through all that nonsense about checking your bag in front of you?"

"Yes they do.  For ANYTHING that looks like a real gun. Even if it is just a realistic looking toy."

"Well, we don't make the rules,"  I said.  "Thank you so much for your help!  You've saved me a ton of hassles."

Hee Hee!

So my new recommendations is anytime you fly, bring your Nerf gun.  Declare it.  If some TSA goon says, "This doesn't look like a real gun," tell him that it does where you come from, and thank him for keeping us all safe.

So I found myself with the need for some more taxicabs and some money came in.  We could have spent a whole lot of time and energy looking through Craigslist, and other websites, and visiting private party sellers, or we could go to an auto auction.  A private sale is a bit difficult at times.  Unless you spot exactly what you want on the side of the road with a sign on it, you end up wasting a lot of time.  First you have to call the seller, then actually get in touch with him, then link up somewhere and view the vehicle.  Then the haggling begins.  Now, I have made some good deals in buying private party, but it is a lot of headache. 

 I decided to go to the auctions instead.  The first thing I did was to look at the auction house web sites for Phoenix.  I can’t say what the websites are like in other cities, but here in Phoenix, most of them are a waste of time.  The sites are invariably difficult to navigate, with lots of flash animation or slide shows that are just annoying as hell.  Furthermore, the vehicle list is usually partial, and usually inaccurate.  This is because they are adding new vehicles to the pile to be sold up until the day before the great sale. 

Frustrated, I drove by Five Star Auto Auctions, an auction house I knew of, and talked to the man I saw on the lot.  He told me that the next auction was Saturday morning.  This was on a Thursday.  I was in luck.

 Friday afternoon, I blocked out about an hour of my time, put the phones on forwarding to one of my drivers, and popped into the auction yard for a look-see.  There were literally a hundred and fifty vehicles, of all makes and models, and all colors and conditions.  Some were police impounds.  Some were wrecks.  Some were stolen car recoveries.  A couple were seizures from the DEA or some other alphabet soup agency whose primary job it is to keep Johnny from getting high while destroying civil liberties.  My first stop was the payment window at the front of the yard to fetch a list of vehicles. 

 The list is fairly comprehensive, and up to date, as opposed to the crap that is on the website.  However, it says right on the front page that the list is a draft and can change up to the day of the auction.  New vehicles get added.  Some vehicles are taken out due to title problems.  Others are on consignment, and the seller changes his mind at the last minute.  Basically, human stuff.  List in hand; I began to make my way down the rows and rows of cars and trucks looking for things to bid on.

 All of the vehicles were unlocked, and you are allowed to poke under the hood and in the trunk to see what you can see.  I came across a few vehicles that would serve my purpose:  Create new taxicabs.  There were three Mercury Grand Marquis, two Ford Crown Victorias, a Lincoln Town Car, and a Ford Expedition I wanted to look at.  All three of the Mercs were serviceable as cabs.  One of the Vickys was a former taxicab complete with meter and top sign, but with almost 400k miles on the odometer. Yikes!  That one would have to be a parts car if I took it at all.  The other Crown Vic was a 1997 and looked like it was used primarily as a paint removal experiment.  The Expedition had some minor body damage on the rear fenders (both sides.  How the hell do you do that? Squeezing into a narrow garage?).  But where was the 1999 Town Car?  I searched and searched the lot, looking for it, finally asking one of the auctioneer’s assistants where it was. 

 “Over there,” he said, pointing.  “It’s kind of grey.” 

The Lincoln was a total wreck.  Whatever the idiot driving it had hit, ended up shortening the front end by 2 feet.  All the airbags had deployed, and the front was so mangled, it was doubtful we’d even be able to pull off any salvageable parts, save the tires and some interior stuff.  Ouch!   I made a quick note on its line in the auction list, and was done.  Tomorrow was the big day. 

The auctions start right at 8:00 am, and the gates to the auction yard open an hour earlier.  So, bright and early, I got my mechanic, and my son out of bed, and we piled into the trusty Expedition to the auction yard.  We made a quick pit stop to McDonald's for some scrambled egg biscuits and hot coffee, and rolled up right as the doors opened.   Together, my mechanic and I looked over the vehicles I had noted down as cars to bid on.  We went over every inch of them, making mental notes as to what needed fixing, and how much we were willing to spend on them.  Then it was time to go buy a bidder number. 

I panicked when I slapped my pockets and found that my wallet was missing.  I had money, and all my credit cards and ATM cards in it, as well as my driver’s license and airport ID.   I said a quick prayer,  then sent my son and my mechanic to search the Expedition, while I made inquiries at the office.  No wallet was turned in.  In a complete panic, I headed to the SUV to see if the guys had had any luck.  My mechanic met me 20 feet from the truck, holding my wallet aloft in victory. 

“Found it!  You threw it on the dashboard when you paid for McDonald’s, dumb-ass!” 

Oh thank God!

The bidder’s deposit is $400.  Once you give that and your ID to the cashier, she hands you a bidder number card.  If you buy something, the deposit goes toward the purchase price.  If not, it is cheerfully refunded when the auction is over.  You need to hang onto your bidder number card, because if someone takes it, they can bid on stuff with it, and YOU are responsible for the purchase. (“I paid HOW MUCH for a 1997 Kia??”)

THE AUCTIONMOBILE

For the first part of the auction, the auctioneer and his assistants ride on the back of an old GMC 3500 flatbed truck that has been rigged up with writing desks, and chairs, and a PA system.  They drive up and down the rows of cars, selling each one as they go.  One of the assistants holds a flag with the auction house company logo on it, and stands in front of each car being sold, waving the flag so everyone knows which vehicle is being bid upon. The bidders follow along in an unruly mob. The first to go was a 1997 Acura Integra which was hit very hard in the front.  It went for $1000, which I thought was astronomical, considering the condition this wad of metal was in.  But soon the bidding settled down into a routine, and some of the vehicles went for real bargain basement prices.  The first one to go cheap was a 1988 Pontiac Bonneville in pretty good condition.  Only the grill was missing, but the rest of the car was straight, the paint was in pretty good shape, and the interior was in good shape as well.  One of the assistants started it, and it sounded strong.  Final bid on it was an amazingly low $425. 

As we worked our way down the rows, several auctioneer assistants worked the crowds, moving among them, joking, and encouraging higher bids.  And when a bidder offered higher, the assistants would loudly yell “HUP!” and point to the bidder.  Eventually, the bidding on each vehicle would slow, then stop, and the auctioneer would call out the highest bid so far, and the bidder’s number.  A quick note was made, and it was on to the next car.  The auctioneers rarely spent more than two minutes on each car, though they did have to stop every once in a while, and clarify things.  Their hyperkinetic helpers working the crowd would mistake someone scratching or yawning for a bid.  But things went very smoothly, and no one was disappointed or upset by the procedures. 

 The auctioneer himself showed a lot of humor, and worked the eager crowd himself.  One battered old pickup truck, a 1991 Dodge Dakota, went up for sale.  The entire roof had been crushed by a falling tree or something.   

 

IT'S ALMOST A CONVERTIBLE!

“Next up is the 1991 Dodge; a former new truck!  Look guys!  It’s almost a convertible already!”

 It went to a guy from a junk yard for $450. 

 The first car that I was interested in was a retired taxicab.  With 400k miles on it, ample body damage, and a wiring harness that looked like a terrorist raid on a spaghetti factory, it had seen better days.  When an assistant fired it up, it made a horrible grinding noise.  My mechanic and I both looked at each other, and said in unison, “What was THAT noise?”  I had never heard a vehicle make a noise quite like that.  But, it ran fairly smooth. 

 “Garrett,” I barked at my son, “Go behind this one, and see if you see any smoke out of the tail pipe.”

 “A little,” he said from behind the cab.  

“Blue or white?”

 “Bluish.” 

My mechanic and I looked at each other knowingly.  The rings or valve seals were shot.  The engine was junk.  The auction truck arrived, and the bidding started.  I expressed interest in the battered machine, and bid on it until the price hit $400.  I can get $300 out of it to a recycler, and there were many good parts on it, not least of which was the $200 taximeter.  At $400, I bowed out.  One of the assistants kept looking at me, and encouraging to go higher.  I just shook my head. 

The next one I bid on was a cute little 99 Ford Escort.  It was teal, with no visible body damage, and a decent interior.  The engine purred like a tiny kitten when started.  I thought it would make an excellent first car for my 19 year old daughter.  But when the bidding reached $500, I paused.  The assistant nearest me kept saying, “Go $550.  It’s a nice car!  Go $550!”  My mechanic was less impressed.  He shot me a look that said, “Are they PAYING you to be stupid, or are you doing it pro bono?”  I shook my head and let the little car go for $500.  I was determined to save my money for the Marquis. When we got there, the bidding opened at $400.  I immediately raised my number and was acknowledged.  And I found myself in a bidding war with some guy I could not even see on the other side of the auctioneer's truck.  $800... $850... $900... Theprice quickly climbed higher.  Finally, at $1050, my opponent gave up.  I found myself the lucky owner of a 1998 Mercury Grand Marquis with 128k miles on the odometer.  It would need some paint, some hail damage repair, a stereo, a good interior cleaning, and a bunch of little doo-dads, most of which we had back at the house.  But it ran like a dream.  All in all a good find.

After the last of the cars in the rows were sold, the auctioneer announced to the crowd that we were going to view the driveable cars.  So, we all moseyed over to the drive through area.  A small stadium  was permanently set up in one area of the auction lot.  The grand stands were made from salvaged movie theater seats, except the front row, which looked like it was made from bench seats stolen from someone’s old van.  Across from the seats stood an old, stakebed truck from the early forties with liberal rust, and faded green paint.  The auctioneers moved their computers and notepads from the auction truck onto the back of this stakebed truck, and set up.  Meanwhile, the mob filled the seats, and found places to stand where they could see.  The seats faced the truck, and between us was a concrete pad they would drive the vehicles through.  The auction house drivers started up the vehicles from the driveable vehicle lot just to the left of the ersatz auctioneer’s stand, and slowly drove them between the auctioneer and the crowd.  As each vehicle arrived, the auctioneer gave a little description, and began the bidding.  Then, as each one sold, the drivers would drive it away to another lot on the other side of the building.  The auctioneer assistants again worked the crowd, and their cries of “HUP! HUP!” preceded each rise in the price. 

After about 15 cars had been sold, the second Grand Marquis I was interested drove into the middle ground.  The bidding opened at a ridiculously low $300.  But this time, the bidding was not quite as quick, nor quite as intense.  I got the car for $850.  I quickly did some math on the back of the auction list, and came to the conclusion that I’d spent enough.  I had two cars today; that was good. 

We watched for a while longer, and saw some incredible deals.   As the large auctions wear on, bidders start running low on funds, or just getting bored, and the prices on the cars start dropping.  This auction was no exception.  A very pretty ’05 Suzuki Forenza went for $3000.  A ’95 Cadillac Sedan DeVille went off for $600.  An exceptionally good condition 1966 Ford Ranchero sold for $3700.  And, the one that made me cry a little, the lovely white Ford Expedition, twin to mine, drove away for a mere $1900.   

It was time for us to be on our way.  A quick trip to the cashier window, and we settled up.   There was the base price of the car, the 10% commission for the auction house, a $20 document fee, and of course the 9.5% sales tax.  (Is there anything the omnivores in government DON’T tax?).  My $400 deposit was applied to the purchase fee, and I put the remaining balance on my debit card.  For $2028, we now had two new vehicles to turn into taxis, both of them purchased for less than half of their blue book value!  We collected the titles, and the keys, and took them away, quite happy with what we had done.   Once they are painted, you can take a ride in them!

So here is what I can tell you about going to auctions:

First, do your homework.  The auction house lets people view the cars all day the day before a sale, and for an hour or so before the auction begins.  During the sale, there is no real chance to view the cars.  Make notes on the auction list about stuff you want to bid on.  When you go home, look up the cars on Kelly Blue Book’s website, and see what they are worth.

Bring a friend who knows a bit about cars, even if you know more about cars than he does.  After all, two sets of eyes are better than one, and often you’ll spot things the other guy misses. 

On the day of the auction, eat well, and bring a huge steaming cup of coffee.  The auctions are often held outdoors, and the air can be nippy.  Besides, you will want to be fully awake and alert.

Bring a kid.  Kids love these things and it is good to continue American traditions.

When bidding on a car, realize the auctioneer assistants are there to help you.  However, they are there to help the auction house more.  So they will encourage higher and higher bids. 

Unless you really REALLY want the car, never bid higher than two thirds of wholesale book value.  No car ever ended up in an auction yard because it ran too well.  You will most likely have to do some work to whatever treasure you come away with. 

If you’re going to drive it, do not bid on wrecks.  These are insurance company salvage vehicles, and the insurance company has usually determined them to be total losses.  The cost to repair the damage to the vehicle far exceeds the value of the car. 

Pay attention to the type of title on the vehicle.  A salvage title will destroy the resale value of almost any car.  And you may have to go through an additional state or city inspection on a salvaged car to get it registered. 

Watch your budget.  Do not forget the lot fees, the commissions, and the taxes you will pay on each car you buy.  And it is very easy to get caught up in the excitement of a bid and lose track of how much you are really spending.  Especially with guys yelling “HUP! HUP!” in your ear, and egging you on to higher bids. 

Don’t worry if you don’t find anything.  There is always another auction. 

 

Have fun!

 

 

A recent series of events in Portland Oregon encapsulates much of what is wrong with the taxi industry in the United States (and much of the rest of the world) today.  Some cab drivers in Portland Oregon are restless.  And they are angry about three things.  First, some cab drivers in town have been giving money to hotel bellmen and valets in exchange for calling them directly when the hotel needs a cab.  Second, the city government of Portland wants to increase the taxi fleet size in Portland by 132 taxis; an increase of nearly one third.  Last, cab drivers are making “below minimum wage”.

 And the cab drivers have begun to protest by driving their taxis slowly around the Embassy Hotel in down town Portland, tying up traffic and making a hash of things.  Several of the cabs bear signs decrying “cheating” and “unfair practices” by the hotels.  But is it really cheating? Is there really a need for 132 more cabs in Portland? Are the drivers really impoverished?

 The first complaint revolves around some cab drivers “tipping” hotel staff to call them directly, instead of going through a company dispatch, for guests at the hotels who need cabs.

 "This kickback scheme causes lost revenue to honest drivers, delays to unsuspecting customers, and outright fraud as unscrupulous drivers cheat passengers to make up for the payoff," said Red Diamond of the Cabdrivers Alliance of Portland.

Really?  First of all, it is not “unfair”.  No one particular cab driver has any advantage over any other except for two things:  He is willing to give a tip to the hotel staff, and he is on call for that hotel.  That’s it.  Any cab driver can go to any hotel and talk to the staff there, and tell them, “Hey, I work this area.  Here is my card.  One hand washes the other.”

 The hotel valets make a large portion of their income through tips.  And cab drivers need the passengers.  There is no reason that the hotel guy shouldn’t receive a gratuity from the cab driver for passing him the business.  It’s not just the cab business that does this, either.  Many businesses offer a “finder’s fee” for business referrals. The local “gentlemen’s clubs” here in Phoenix pay the cab drivers $5 for every paying customer they drop off. And just the other day, I was talking to a used car lot manager.  He told me that if I ever brought him a customer who purchased a car from him, he would pay me a finder’s fee of $50.  This is not some sort of a crime.  It isn’t “unfair” by any stretch of the imagination.  It isn’t even unethical.  Why shouldn’t someone get paid for linking together a customer with a service provider?

Red Diamond says that a hotel calling a particular driver results in “delays to unsuspecting customers and outright fraud as unscrupulous drivers cheat passengers to make up for the payoff.”  This is the exact polar opposite of the truth.  If a driver tells a hotel valet “Tell the passenger I will be there in ten minutes,” then shows up in 30, causing a “delay to an unsuspecting customer”, the hotel valet won’t call that driver ever again.  Why?  Because hotel valets do not want to fade any heat from an antsy guest waiting for a cab.  A driver might be able to get away with “stretching his hood” once or twice.  But after that, all his efforts to gain the good graces of the hotel go out the window.  The same is true for cab drivers who cheat passengers to make up for the tip.  If news gets back to the hotel, that driver will be gone in a New York minute.

The next so called “problem” revolves around the city of Portland’s government allowing 132 new taxi licenses. But the people in the city government who propose the limits on the number of taxis on the streets have no clue about the taxi industry. They’ve never driven a cab.  They’ve never owned a cab company. They have never dispatched.  Essentially, they are operating in the dark. So, they "consult" with experts. And who might these experts be? Why the owners of the largest cab companies of course!  And these cab company owners suggest things that would be very beneficial to themselves (like limiting the amount of taxis on the road). Why wouldn’t they?  This is why the regulations get crafted in such a manner as to favor the big companies and shut out competition.  It's called "regulatory capture" and it happens all the time.

The last issue the cab drivers are protesting is their low pay. As to the comment that cab drivers "make less than minimum wage", this is just not a fair comparison. Yes, drivers do make about $100 per day. Yes, they do work 12 to 14 hours a day. But unlike almost any other industry, profits in cab driving depend to a large degree on the "hustle" of the driver. A driver's income, more often than not, is directly dependent upon how good he is at gaining his own personal business. A good driver knows where to be and when to be there to get the best fares. He reads the entertainment section of the newspapers to know where concerts are. He owns a cell phone, and passes out his own business cards to everyone he meets to generate calls. He calls upon the managers of grocery stores, and bars. He talks to mechanics, and the owners of car rental outfits. He even tips hotel staff for cab runs. These are not  "unfair" practices since any cab driver with motivation can do it (and does do it). Yes, the average cab driver makes about $100 per day. But the above average ones, the ones who take their jobs seriously, the ones who value their customers as their bread and butter, the ones who are polite and have clean taxis, make far more than that. 

The solution isn't to complain about "low pay". The solution is to treat cab driving as a career and not just another job. I have NO sympathy for guys who sit on a cab stand all day, reject job offers on the computer because they are grocery runs or short hops, do nothing to improve their own lot in life, and then cry poverty at every opportunity. If a cab driver is making "less than minimum wage" it is often his own fault. He should move on to a job at McDonald's or Walmart. No one is putting a gun in his ear and saying "You must drive a taxi". I've been in this business for nearly 20 years, and there is an old joke told around here: "What's the difference between a puppy and a cab driver? Puppies stop whining after 6 months."

In their infinite wisdom, the city of Portland is holding a number of meetings to decide what to do about these “problems”.  They are discussing the possibility of adding cabs, and the outlawing of hotels accepting tips from drivers.  God help the cab industry of Portland if these self-appointed Problem Solvers attempt to address the issue of low driver pay.  Ban hotels from tipping, and guests will end up waiting for whatever cab they can get; not one that will show up on time and in good condition. Add too many cabs, and the market will be flooded.  Add too few, and passengers will wait far too long for taxis.

The solution to all of these problems is  for the city of Portland to back off and stop interfering in the taxi industry. Only a free market will provide a solution to these issues.  A free market allows for companies to decide for themselves how many cabs to field.  A company that adds too many or too few will suffer the consequences themselves.  A free market allows cab drivers to tip hotels (or not tip, and base their sales on better service alone) as they see fit.  A free market rewards hustle and punishes laziness in the drivers.  A free market offers the ONLY solution.

But an understanding of how the taxi industry is being abused by city councils, not just in  Portland, but in most cities around the globe from Adelaide to New York City, will lead to a greater understanding of why and how government s operate. 

Like the city council members, members of State and Federal governments know very little about the industries they are trying to regulate. Yet, they sincerely want to solve problems. This forces them to seek experts in their fields, and leads to the creation of lobbyists, and ultimately results in regulatory capture. 

Like city council members trying to ban tipping at hotels, State and Federal governments attempt to ban financial rewards for the communication of vital business information (insider trading laws, etc.). They want this unfair world of ours to somehow be fair. But this kind of regulation leads to poorer performance in industry as opportunities are missed. 

Like city councils interfering in the pay structure for cab drivers, so too State and Federal governments often interfere in the compensation of employees.  This results in laziness, a lack of innovation, and a much poorer business climate, not to mention a loss of jobs.

Real problem solving is not that hard.  Keep the ignorant Problem Solvers completely out of the marketplace.  Freedom will take care of the rest.

 

So much on this Earth is based upon fractals.  Smaller systems tend to resemble larger systems, the difference being only a matter of scale.  It is my contention that if you can understand the cause of things in a smaller, easily examined environment, you can also understand how bigger systems work.  Understanding a small sector of the free market, and how government interference affects it will help us understand the greater problems of State and Federal government.

A shining example is the medallion system of taxicab regulation. By understanding how the regulations came about, and what happens when it is removed, perhaps we can understand how the larger processes of federal regulation works, and what we can expect when those regulations are removed.

 

The medallion system refers to the limitation by local government upon the taxi industry on the number of cabs allowed on the road.  The city government sets up a taxi commission, which decides how many taxis it will allow on the road.  Certain restrictions are placed upon these taxis.  It may be the age of the vehicles, it may be the body style of the vehicles, it may be vehicle inspections.  In New York City, it is all of those things.  In order to own a taxi in New York, you must purchase a medallion (get permission from the city to ply your trade), and then follow a list of rules that runs to dozens of pages.  Most major cities in the USA follow this pattern. 

 

Before 1937, the taxi industry in New York City was a free market.  Anyone who wanted to could open his own cab company, and New York was a hub of innovation.  But in 1929, the Great Depression hit, and by the mid-1930s many unemployed people had it in their minds that an easy way to make money was to simply turn their car into a taxicab.  The resulting glut of taxicabs in the city, along with the reduced economic activity due to the Depression put enormous pressure on the larger cab companies.  In order to protect their own interests, they appealed to the city government.  The result was the Haas Act of 1937, which artificially limited the number of taxicabs to 16,900—about half of the cabs that were then plying the streets of New York. 

 

Any artificial limitation upon the number of participants in a particular field brings with it attendant problems, and the New York taxi industry was no exception.  With an artificial ceiling on the number of taxicabs, and thus a demand that outstripped supply, the price for cab rides rose.  This problem was addressed by the adoption of regulated fares.  When the quality of drivers suffered, the taxi commission adopted various rules regarding driver behavior.  When drivers started getting robbed, the TLC introduced partitions in the taxis. 

 

But none of these responses have worked well.  There is still a shortage of taxis in New York.  Many people cannot get a cab on a busy afternoon in Manhattan, and the outer boroughs are barely serviced at all.  While the regulation of taxi fares has kept the price of cab rides affordable for the general public, the drivers are doing poorly financially.  And though the partitions have reduced robberies by knifepoint, now robbers armed with guns steal the entire taxicab.  And the partitions themselves have caused numerous injuries to passengers involved in otherwise minor accidents.

 

At first, the solution seems to be deceptively simple:  Abolish the medallion system and go back to a free market in the taxicab industry.  Freedom will allow an increase in the number of taxicabs on the streets at any given time, resulting in more and better quality service to the denizens of New York.  Fares will rise until the market itself clears at a price that is agreeable both to the taxi drivers and the passengers.  And any company that desires to install partitions can be held liable for injuries suffered when the vehicle is involved in a crash. 

 

But then one comes to a realization of several problems.  The medallions themselves are transferable, and very valuable.  The result is that these artificial constructs are treated like property.  Cab companies buy and sell them, and a whole industry dedicated to financing them has sprung up.  Recently, 2 taxi medallions sold for $1 million each.  With so much value tied up in the artificial property rights created by these medallions, the cab companies are dead set against any changes in the number of medallions the city issues and the abolition of the medallion system.  Companies and owner/operators stand to lose millions of dollars if the medallions are eliminated.  And if the number of medallions increases, the resulting dilution will lower the value of the medallions. 

 

The city government is not interested in removing the medallion system either.  The city makes millions of dollars every year off the fees it imposes on taxicabs.    

 

The city of Indianapolis, Indiana deregulated its cab industry in 1994.  In the words of its former mayor, Stephen Goldsmith, here is what happened:

On July 1, the artificial cap on the number of taxi licenses was lifted, offering the first significant prospect of new market entrants into the ground transportation industry since shortly after the end of the Second World War. For the first time in just as long, the new law lifted the prohibition against "cruising," or hailing a cab. This anti-competitive provision was cunningly designed to prevent new market entrants from getting into the business by cruising the streets. Since the only practical way to get a cab was to call one, only those cabs with city-approved radio dispatch systems could compete, and since the only companies that could afford the city-approved dispatch system were the few dominant, well-heeled, and legally protected providers, their position in our market was secure.

The impact of the new Indianapolis ground transportation ordinance, which also abolished the official minimum fare, allowing taxis to charge as little as they like for a ride, even surpassed our own expectations. In the first month, the number of licensed taxi operators rose an amazing 60 percent, from twenty-eight licensed companies to forty-five. In addition, the new competition dropped fares among the new licensees almost 7 percent. But perhaps even more impressive than reduced fares and increased competition is the effect that the new market system has had upon the drivers themselves.

Nearly overnight, the dress code for taxi drivers went from ripped T-shirts to collars and ties. Cabs are noticeably cleaner, cabbies are friendlier and their vehicles are more visible on our streets.

In all, there have been twenty-nine new taxi companies licensed since deregulation, which means that the number has more than doubled since the proposal was adopted. Today there are fifty-nine licensed taxi companies in Indianapolis, and an entirely new industry in jitneys and minivans.

The true solution to New York City’s, and other cities’ cab problems lies in the elimination of the discredited taxi medallion system.  But with the opposition of both the taxi industry and the city government itself, such a prospect is dim indeed.

Welcome to New Orleans, one of America’s oldest ports, and known for its jazz, its cuisine, its ability to get smashed by hurricanes, and of course, its taxi services.  These plucky cab drivers put up with locals and tourists, business people and students, and do it with a charm, style and grace that is uniquely the province of cab drivers.  Just like cab drivers anywhere else.  And like cab drivers anywhere else, they are beset on all sides by the nanny state. In this case, it is the Taxicab and For Hire Vehicle Bureau.

The Superbowl is scheduled to be played in New Orleans in February of 2013, and in a spirit of improvement, the city council of New Orleans, led by the indefatigable Mayor  Mitch Landrieu, has passed a number of new regulations on taxicabs.  According to Mayor Landrieu, as quoted by  The Loyola Maroon, “This is not an assault on the thousands of taxicab and for-hire drivers who serve as important frontline ambassadors for our city and region. But in order to enhance our position as an international travel and business destination, we must improve taxicab service in New Orleans.  My goal is to achieve a complete transformation by Superbowl XLVII in 2013.”

The transformation he wishes to see is that all the taxis in the city of New Orleans be upgraded. The new city ordinances, passed back on April 19^th, and due to take effect on August 1^st states that all taxis must be 11 years old or newer starting with the effective date of the new city ordinance, and 7 years of age or newer beginning January 1, 2014.  In addition, all cabs must carry new equipment and signage.  This equipment includes security cameras, GPS systems visible by the passengers, and  point of sale terminals for taking credit cards.  “The city believes that these reforms will benefit residents, the tourism industry, and even business and safety for the drivers,” gushes the Maroon.

The cab industry is complaining about these new regulations.  They are far too expensive, they say.  The Maroon quotes Syed Kazmi, the president of United Cabs, as estimating  “these reforms will cost taxi cab drivers $30-35,000. Kazmi owns five Certificates of Public Necessity and Convenience, [New Orleans equivalent of taxi medallions] permits which give him the right to pick up fares, so he could be facing a $150,000 tab.”  The owner of Nawlins Cab, Sheree Kerner, told the New York Times that new vehicles would cost between $25,000 and $30,000 each.   The drivers are upset as well, especially the owner operators who have to finance these new upgrades out of their own pockets.  The cabbies and company owners were so upset, that they sued the city of New Orleans to block implementation of the new regulations which were to go in effect August 1. 

But the cabbies are complaining for the wrong reasons.  It’s not just that the city is requiring them to buy new equipment.  In fact, the cost of the new equipment and taxi upgrades is not nearly what the cabbies say they are.  A brand new, state of the art security camera that meets all of the parameters set forth by the new regulations is only about $300.  And even the most expensive item on the list of government mandated “improvements”, the upgrade to newer taxis, is not as bad as the cab companies and owner operators would have people believe.   According to Kelly Blue Book, a 2008 Ford Crown Victoria LX (a very good choice for a taxicab), sells for $9,000 to $11,000.  And they can be purchased at auction for several thousand below book value.  This is a far cry from the $25k to $30k claimed by Ms. Kerner.  Nonetheless, the lawsuit went forward, and an injunction was granted, blocking the city from implementing the new “reforms”.  It is doubtful, however, that these regulations will be blocked permanently however.

It is just too bad the cab drivers are complaining about the wrong things. 

First is the attitude of the Mayor.  Acting like the city is his personal fiefdom, the mayor announced to the Loyola Maroon, “My goal is to achieve a complete transformation by Superbowl XLVII in 2013.”  And just how is this arrogant achievement to be attained?  James Garner (not the actor who has actually done some productive things with his life) an attorney for the City of New Orleans was remarkably candid. He said in open court, “We are using the city's police powers to say we will have certain amenities for customers such as credit card machines and cameras in the cabs for better security."  How very nice of the city to use GUNS to provide amenities for the people of New Orleans.  What next?  Grenades through the windows of restaurants that choose bar soap over liquid soap in the lady’s room?  Where exactly does this provision of “certain amenities” at gunpoint stop?  Shall the city government bayonet the hotel staff if they forget to put a chocolate truffle on a newly made-up bed?

I agree that taxicabs should accept credit cards.  I have been doing so at my company for as long as I have been in business.  However, many drivers do not want to pay the exorbitant fees charged by the banks, and so decline to accept credit cards.  Why can’t that be their choice?  After all, it is the dollar bills that say “legal tender for all debts public and private”, NOT the credit cards.  And is it really all that hard to stop at an ATM?  Which brings us to a very salient point:  Who owns the taxi cab?  It certainly is not the city of New Orleans government.  Nor is it the Mayor himself, or his lawyerly little side kick Mr. Garner.  The cab company owns the cab.  And it should be the cab company who decides what form of payment to take or not take.  If the driver or the cab company choses to accept Thai Bhatt or livestock in trade, what business is that of the city council?

Oh, but it is public transportation. 

Really?  No, a taxi is NOT public transportation.  “Public” things are owned and operated by a government entity; not an individual.  Such items include public parks, or public buildings, or public buses.  But not taxicabs.  They are private property owned by private individuals and private companies.  The government has no more business sticking objects in my property than it does putting spy cameras in the men’s room of Starbucks.  When the city government pays for the oil changes, and the brake pads, and the gasoline, like it does for public busses, then I might concede that they are “public” transportation.  Just because random individuals use my services does not make my cars property of the city.

As with many idiotic and ill-conceived city ordinances, the devil is in the details.  And looking at the details, the New Orleans taxi ordinance is downright scary. 

The rules for these new security cameras to be forced upon cab companies are covered in New Orleans Municipal Code Sec. 162.660.  In careful detail it spells out all the parameters for the new security cameras that the cab companies will be forced by the city’s “police powers” to provide.  The list is fairly exhaustive and rather technical, leading me to believe that it was drafted with more than a little “help” from a vendor or manufacturer of these devices, since your average city employee couldn’t find his own rear end with a map and both hands in his pockets. But the scary part is the next section down.

Sec. 162-660 par. (3) states “Use of digital still or video images. Access to any recorded image of persons in a taxicab is prohibited except by the taxicab and for-hire vehicle bureau or the New Orleans Police Department. Violation of access to images shall result in revocation of a CPNC and/or driver's permit.”

Think about it:  Even though the cab companies must pay for the cameras, must pay for their installation, must assure their working order, ONLY the city of New Orleans employees will have access to the videographic records recorded by them.  Assume that a taxi company decided voluntarily to install its own cameras in vehicles for driver safety and quality control.  If the taxi company received a complaint about a driver’s behavior, the road manager could look up the proper footage on the video, and instantly determine if the driver was behaving badly, or if the passenger was out to lunch.  Not with this system.  With this system, it would be illegal for a company owner to access information gathered by his own machines.

 Furthermore, paragraph (9) of the ordinance states “If bureau personnel or a New Orleans Police Department official requests access to any record produced by the digital security camera systems to assist in the investigation of any complaint or crime, the taxicab company must provide access to the record within 24 hours. Records may only be accessed by bureau personnel or a New Orleans Police Department official, and only when a bureau complaint number or police complaint number has been generated.”  Note that this does not require a warrant or a subpoena at all!  Simply a complaint!  Talk about violations of the Fourth Amendment

And there are all kinds of opportunities for abuse.  I have had passengers discuss very important business details, and all manner of personal things in my taxi.  With a government employee only required to generate a “complaint number”, this information is readily available to any drone who goes to work at the Taxi and Hired Vehicles Bureau.  And while there is punishment aplenty for cabbies and road managers who view their own videos without authorization, the city ordinances provide no consequences for city employees who do the exact same thing.

Then there is the credit card point of sale terminals required in each taxi.  As well as the forced installation being just as much a violation of the cab owner’s property rights, this provision is subject to its own brand of government stupidity. 

First is the required location of the terminal.  Sec.162-159 par.2 mandates: “All [credit card terminals] must be bolted to the head rest or in an area approved by the bureau in the passenger compartment.”  Now, anyone who knows anything at all about cars realizes that the back of the front seats and the head rests are padded for a reason.  In a crash, the body of a rear seat passenger is thrown forward.  If he is not wearing a seat belt, his face will hit the back of the seat in front of him.  What better place to put a heavy metal object then right where the passenger’s face will land in a crash!  This is the exact same problem caused by the non-bulletproof partition in New York’s taxi fleet. 

But not only that, Sec.162-659 par.(8) states “The bureau shall have unlimited online access to all information collected by the PIM.”  You get that?  If you use your credit card in a taxi in New Orleans, the Taxi and For Hire Vehicle Bureau can access all your purchase information at any time without any oversight whatsoever. And that makes perfect sense because no city of New Orleans employee has ever been arrested for anything.  They are all paragons of virtue.

NOT!

My advice to anyone who goes to New Orleans is very simple.  If these city ordinances take effect, and you find yourself in a New Orleans taxicab, mind what you say.  City employees will be listening and watching.  And be careful not to sit in the rear seat with the credit card terminal.  If you do sit there, wear your seat belt… tightly.  Last, don’t ever use a credit card to pay for a taxi in New Orleans.  You don’t know who will have access to your numbers.  Pay with cash.  There are ATMs everywhere.

My advice to cab company owners in New Orleans is simple too.  Stop letting these fools in government push you around and stomp all over your property rights.  Don’t you realize that a mere 4 taxicabs driving abreast on the 10 at rush hour at about 25 mph will practically shut down the entire city, and be an incredible protest? Yes, it is expensive to follow these new government regs.  But it is expensive in many more ways than just the money.  It isn’t always “all about the Benjamins”.

My advice to cab drivers in The Big Easy: Any time anyone wants to pay with a credit card and wants to use the government approved, government spied upon terminal, remind the passenger that the Taxi Bureau has UNLIMITED access to this transaction information.  You'll never have to accept plastic again. Also, wait until you get some city official or some high muckity-muck in your cab.  Then talk him into saying something incredibly compromising or embarrassing.  It is very easy to remove a video camera SD card and download the video to YouTube.  The first one to post a video like this will get bragging rights for having gotten the damn big brother machines out of the cabs.

 

A thought about a pickup truck got me thinking about this whole essay.  I was thinking how Ford pickups are so very well built, one of them will easily last 20 years.   If you had purchased a new one, and kept it for 20 years, that would only be a 1992 model pickup truck.  Hell, just the other day, I was batting around in a 1989, and it still ran like a champ. 

And that got me thinking.  If you bought a 2012 pickup truck this afternoon, and kept it 20 years, that would be the year 2032.

Good math Paul! You are probably saying. You should probably own a cab company.

But think about it:  You never hear anything about 2032.  Or any similar year.  Ever.  It’s only 20 years away.  I myself will only be 66.  I don’t have any grandchildren yet, but I expect them relatively soon.  If I get a few in the next few years, by 2032 they will be teenagers.  That is not that long a time away.  Yet, no one is thinking of 2032.

Maybe I am reading the wrong websites and commentaries, but everyone seems convinced that everything is going to kill everybody.  There will be no survivors into 2032.  If you read Huffington Post, or Lew Rockwell, or Town Hall, or any of a thousand other commentary websites, you get the feeling that we are all doomed.

 The Obama administration will destroy what is left of this country.  The conservatives will get back into power and usher in a new age of fascism complete with marching goose-steppers, and really snazzy black boots.  And if they don’t kill us all, then the environmental disaster will.  The world will warm by 8 million degrees because you insist on using your hairdryer, dammit.  And the icepacks will all melt and the penguins won’t have a place to stand.  Then New York City will be under water, and so will Miami.  In fact, Telluride will have a beach and you can sail down the ski slopes straight into the Caribbean (or whatever we will call it).  Except that there won’t be any snow.  Ever.  Because Mother Nature will have lost the recipe for snow because you kept your goddamn pickup truck for 20 years just like we told you not to. 

But then it will snow because the Israelis will attack Iran precipitating a massive response from Russia who will use ICBMs to blow the United States off the map in retaliation, but instead will hit Canada because the same geniuses who built the Russians cars worked on the Russians ICBMs and they both steer about the same.  And so the United States will retaliate by blowing up the rest of the whole planet except Australia where Mel Gibson is doomed to wander around looking for gasoline.  This will plunge us all into a nuclear winter, where no crops will grow and everything will freeze, and the penguins will have plenty of places to stand, and in fact you will have giant, mutant, glow-in-the-dark penguins standing in your living room pecking at your freeze dried corpse. And all of this because the Israelis are paranoid that someone might treat them as well as they have been treating the Palestinians for the last 45 years.  Or maybe it was about oil.  You know, for that pickup truck of yours you wanted to keep for 20 years.

But it won’t really matter if we manage to keep peace between groups who really don’t want to go to war, because the giant comet is going to hit the Earth, followed by a giant asteroid. (I had asteroids once.  It makes it really painful to poop. )  And if the asteroid/comet hits the land, it will cause a massive forest fire that will burn down everything and kill all the dinosaurs just like it did 20 million years ago.  Except the only dinosaurs around are that old geezer who keeps yelling at my kids, and that purple one on TV; both of whom actually deserve to die.   And of course the asteroid/comet could hit the ocean too, because that makes much better TV because then you can show graphics of the giant wave that will come and wipe out the entire earth, even Telluride.  And if the asteroid/comet misses and zooms off into space, it will leave a vapor trail of deadly chemicals that will raise all kinds of hell and make us all die off except for our mutant babies who will plague a deserted New York City inhabited only by an unemployed   Will Smith and his loyal dog who drives around town in a Mustang the same year as that pickup truck you wanted to keep for 20 years.

Of course, all of this can only be prevented by the explosion of the giant volcano underneath Yellowstone Park which has chosen this very decade to go off, even though it has been sitting around reading trashy Danielle Steele novels and not doing anything else for the past million years.  And you can tell that it is going to blow up very soon---urgently soon in fact.  This is because a bunch of concerned scientists in white lab coats that they picked up at John’s Uniform Shop said that they accurately measured all of Yellowstone National Park and the whole thing moved a fraction of an inch.  This in spite of the fact that not one of them has ever accurately measured an entire two by four.  Their conclusion is that when Yellowstone blows up, it is going to cover Chicago with a thick layer of ash and flaming bison parts incredibly deep, and that the Chicago city workers will all choose that time to go on strike since they are all minions of the Obama Administration, and every single last one of us will all choke to death on a thick blanket of volcanic ash. 

Except the people who live on the East coast of the United States, and all of Western Europe and Africa and South America who won’t have time to die from volcanic ash from Yellowstone super volcano because they will be too busy being dead from another volcano in the Canary Islands  which is going to make 1/6 of one of the islands slide into the ocean generating a massive killer tsunami  that will wipe out everything from Nova Scotia down to Buenos Aires  as well as the Atlantic coasts of all of Europe and Africa And this wave will be so goddamn large that every city town and village will be instantly leveled, and all the crap will be piled up in one long line stretching from Buffalo New York down to Tuscaloosa Alabama  which really was hit by a big tornado last year and has, as a group, just about had it up to here with ends of the world. And of course the only survivors of all of this will be the Boston Red Sox and that is because they will be on the West coast playing the Los Angeles Angels (of Anaheim, California, USA) at the time all of this happens, the rotten bastards.

But all of that won’t really matter much anyway, because, according to Pat Buchannan,  the Mexicans are outbreeding Americans.  And Pat Buchannan must know because he is a curmudgeonly holdover from the Nixon Administration who, like Dick Cheney and Henry Kissinger, refuses to do the decent thing and die.  And Buchannan is an expert on Mexican breeding.  And he must be right because the Mexicans don’t have cable television.  And the television that they do have is mostly silly, and no one can understand it because it is all in Spanish.  And so the Mexicans have nothing better to do than to breed like rabbits, unlike you, because you’re too busy reading idiotic essays like this on this internet or flipping back and forth between Sponge Bob Square Pants and American Pawn Stars.  And if you would just be a little bit more patriotic and get into that bedroom and breed, maybe this country would be saved!  Might I suggest using the bed of your pickup truck?

 

Except it won’t because you won’t be able to afford your children because the Greek banks are going to collapse and take down the European banks which will take down the Wall Street banks which will take your bank down with it which means there won’t be any money left ever.  Then you will have to forage for food in a crazy mixed up world that resembles a Satanic cross between Occupy Wall Street and a Black Friday morning opening of WalMart.  But since you wisely invested in gold, you can nibble on your gold coins until the mutant penguins come to get you while you freeze to death.  In the dark. In your pickup truck.

And thanks to the ancient Mayans, we know the exact date this will all happen.  Say it together now! December 21, 2012.. 

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