Occupational Licensing

Milwaukee's Taxi Cartel Suffers Potentially Fatal Collision

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Ghaleb Ibrahim

All you need to own your own cab in Milwaukee is a car and $150,000.

In 1991, Milwaukee's taxi licensing council decided to allow cab drivers to transfer licenses, which had been previously forbidden. The change pleased cab drivers, who could now sell their businesses to other would-be drivers. The council also voted, however, to cap the number of taxi licenses in the city at 321.

One dissenting member of the council didn't like "medallion policies" of other cities and predicted that the price for Milwaukee licenses would skyrocket, saying that he didn't "want to see the cost of a license go up to $10,000." Today, with one cab per 1,850 Milwaukee residents, cab licenses sell for 15 times that.

Public-interest law firm Institute for Justice (IJ), along with local drivers Ghaleb Ibrahim, Jatinder Cheema, and Amitpal Singh, filed suit against the city last week. They claim that Milwaukee's cab licensing system creates a cartel that benefits entrenched businesses who have licenses while violating the right of drivers like Ibrahim to earn a living.

"I should be able to apply for it just like any other license that the City Hall offers to the public," Ibrahim said in an IJ video. "All that I want is to own my own business."

Ibrahim immigrated from Jordan in the late 1970s and has driven taxis in Milwaukee for the past two decades—but never his own. He's a local entrepreneur who is qualified and insured to drive a cab. But because he can't afford a license, he has to pay an expensive rental rate to use someone else's taxi.

IJ has led successful efforts to abolish cab license caps and break up similar taxi cartels in Minneapolis and Denver. In its Milwaukee suit, IJ notes that the ratio of cabs to residents in Minneapolis is now 1 to 550. In Denver, it's 1 for every 480 residents.

As Jim Epstein and Nick Gillespie have documented, Washington, D.C., is considering implementing a similar taxi licensing system that would reduce the number of cabs by one-third, put thousands of drivers out of business, and make it that much harder to find a cab on a Saturday night. Let's hope that IJ is watching.

Read A. Barton Hinkle on How taxi licensing drives up costs while enriching special interests.

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  1. The taxi medallion licensing scheme is yet further evidence that chaos, corruption, disorder, mayhem, mass murder, theft and thuggery are what you get with the state.

    Only the intellectually feeble would argue that the state is a good thing.

    1. That’s not true.

      I’m sure the cronies who benefit financially also think it’s a good thing.

  2. I still can’t see any good reason why I should have to pay someone for his or her permission to engage im commerce with other consenting adults.

    Or has that point been brought up around here before?

    1. It used to be the boast of free men that, so long as they kept within the bounds of the known law, there was no need to ask anybody’s permission or to obey anybody’s orders. It is doubtful whether any of us can make this claim today.
      – Friedrich Hayek

    2. “Fuck you. That’s why.”

  3. Tulpa’s take:

    I would rather take my chances with a regulated cab than with a gypsy.

    1. That gypsy with the gold-capped tooth?

  4. Twice in one day?

    joe from Lowell says:
    September 16th, 2010 at 9:38 am
    Matt,

    Don’t get suckered by the IJ. They seize on cute, fuzzy poster boys in order to push radical changes to the law in the service of corporate deregulation.

    “Simply put, the government is not allowed to require people to get a license in order to talk.”

    Simply put, this outfit is committed to eliminating the distinction between commercial speech and individual speech.

    1. Cuz lemme tell ya, Ghaleb Ibrahim is as cute and fuzzy as they get. Well, maybe fuzzy.

    2. “Simply put, this outfit is committed to eliminating the distinction between commercial speech and individual speech.”
      The HORROR!

      1. I mean, that distinction is right there in the Constitution.

        1. Which is why everybody in the legal community should just laugh at the commercial speech doctrine and hold all those who advance it in perpetual disdain.

          If one supports the commercial speech doctrine, one is an intellectual lightweight.

    3. cause simply put, derp

      that is all

    4. Really, the only use for joe from lowell is as a public toilet.

    5. I was just about to ask you to repost that.

  5. But Denver has become nothing more than a smoldering pile of bodies trapped inside unlicensed cabs! It’s awful!

    1. “You think you’re tough for eating beans every day? There’s half a million scarecrows in Denver who’d give anything for one mouthful of what you got. They’ve been under siege for about three months. They live on rats and sawdust bread and sometimes… on each other. At night, the pyres for the dead light up the sky. It’s medieval. “

      1. I bet they don’t even have licenses for
        the pyres either.

      2. Quoting Red Dawn to great effect. Well done.

        1. And I missed it. Shame on me.

          1. plus, H man, it’s a permit for pyres, not a license, duh.

            1. Hangs head in shame.

  6. Ghaleb Ibrahim, Jatinder Cheema, and Amitpal Singh, filed suit against the city last week.

    I’d like to inquire as to the immigration status of Mr’s Ibrahim, Cheema and Singh.

    1. Soon, your family will be inquiring as to your whereabouts.

  7. So apparently someone at the Chicago Board of Trade taped a sign that says “We are the 1%” to a window facing the Occupy Chicago protestors. The patchouli class is flipping out right now. Hilarious.

    1. Here is one of the threads.

    2. That’s pretty amusing.

    3. On a related note this article is on Huffington Post by a musician/artist stating that we need to occupy Wall Street because she is “Another reason to come together. Another reason to occupy Wall Street. Another reason for change.” because she can no longer appear on the cover of Vogue, party all the time nor fly all over the globe.

      1. I stopped reading after “But I’m stupid enough to have put all my eggs in one basket.”

        Yes, you are stupid. Therefore there is no reason to pay attention to anything you have to say.

      2. That article is profoundly clueless over and over and over again.

      3. Sickening! I had to stop reading it.

    4. Magnificent trolling.

    5. The comments are fucking gold.

      “We have nothing to trade! You stole it all.”

      Most people rent out their labor for a fee known as a “salary” or a “wage”.

      Guess these guys can’t even do that.

  8. Watkins needs to learn to use the alt-text.

    1. Yes! The movement is growing!

    2. That better?

      1. It’s a start.

      2. I would have prefered.
        “If he climbed in your cab, you would pay him for the privilege of driving him around.”

      3. You need practice. If I may suggest:

        “Rieger has aged well.”

        or

        “Nardo has not aged well.”

        1. Marilu Henner. One of the two or three hot redheads in the history of mankind.

          I’ll be in my bunk, watching Rustler’s Rhapsody on my Betamax.

  9. The guy looks muslim and agitates against the state. Should soon find himself on the sectet death list.

  10. Ouch, $48,150,000 in wealth gone over night.

    1. You neglected the multiplier of eleventy.

  11. Not mentioned in this article is that 1/2 of the medallion cab in the city is owned by one of the council member. Collusion at its finest.

  12. Twice in one day?

    Thanks for reminding me what a mewling sanctimonious cunt that guy was.

    1. Yowza he was an never-ending fountain of straw man arguments, for sure.

  13. The IJ rocks.

    There should be an action movie.

  14. For some reason the taxi industry has always been an incubator for anti-competitive schemes & overregulation. I recall a scene from A Man For All Seasons or something like that wherein Cromwell threatens a guy running a water taxi on the Thames who tries to charge him more than the regulated rate.

    1. It’s because it’s a relativly easy business to get into if there aren’t alot of regulations. Because of that you go from a good way to make a living to barely scratching out a living in short order. That causes a backlash legal or otherwise from the ones who got in first. I recall in the book Goodfellows the guys set on fire a competitors taxis service.

  15. Just thinking about this, people drive other people around for free all of the time. Much more frequently, I’m sure, than cabbies drive fares. So what is the huge need to massively regulate cabs?

    1. Just thinking about this, people drive other people around for free all of the time.

      Let me be clear.

      I would like to thank Pro Liberate for suggesting a truly-imaginative solution to our national debt problem.

  16. what is the huge need to massively regulate cabs?

    LEECHES

  17. Looks like they stole a page from from Singapore’s playbook. Read about Singapore’s Certificate of Entitlement.

    The Certificate of Entitlement (COE), instituted by the government of Singapore since May 1990, is a program designed to limit car ownership and hence the number of vehicles on the country’s roads. This system in effect requires residents of Singapore to bid for the right to buy a motor vehicle, with the number of certificates deliberately restricted.

    1. This system in effect requires residents of Singapore to bid for the right to buy a motor vehicle, with the number of certificates deliberately restricted.

      Let me be clear.

      I would like to thank Doug for suggesting a truly-imaginative solution to our national problem of slumping home prices.

    2. Benevolent dictatorships. We do it because we love you!

    3. That is just all sorts of wrong.

  18. OT: http://en.wikipedia.org/wiki/Liberty_Dollar

    Read about the federales’ response. Awesome, eh?

    Also, I’ve been given rides by ordinary people on a couple of occasions. Fuck those despotic fuckheads and their licensing and restrictions.

    1. There was nothing new there. Why the link?

      1. I didn’t know. Thought it was interesting.

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  20. “All that I want is to own my own business.”

    Only if the prince says you can. Were you under some delusion that things worked differently here?

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