According to Reason TV, D.C. is considering establishing a Medallion system in its taxi business in order to reduce corruption. The D.C taxi businesses that benefit are the ones with close political ties to the legislature. The losers in this decision are the cabbies that do not meet the requirements to receive a medallion in the first place.
Reportly, only 4,000 medallions will be given out, and the cabbies that meet the requirements will have priority access to the aforementioned medallions. The eligibility standards are primarily based on whose been driving in DC the longest. This measure is highly anti free market. The livelihood of thousands of immigrants will turn into ashes all for the sake of the few cabbies to have more profits? excuse me, not even the cabbies will reap the majority of the profits; the owners of the vehicles and the companies themselves will take home the majority of the profits.
This is a classic example of an oligopoly. That is to say that only a few companies remain in the system AND it makes it more difficult for other cabbies to enter the system due to the high costs of doing so. in this case, you are only protecting the interests of the few and ignoring those of the majority.
Of course there may be corruption, of which the only complaints i have heard of was manipulation of rates in relation to the zones already in place in the city. To counter this argument, one could point out that more access to the information highlighting the specific rates in the city could ultimately avoid such scenarios.
All in all, politicians and big business cab companies are getting there way and it is a sad thing to watch innocent cab drivers being driven out of a business which one could argue could in fact pave the way for future economic opportunities for these low tier owners.
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