Vivid Example of Uber's Creative Destruction of New York Cab Business


Sad story (if you don't think about all the benefits to drivers and passengers) of how Uber is really screwing up street parking in one Greenpoint, Brooklyn neighborhood, via Gothamist.

Jon-Nicholas Kiouvas has been working at McGuinness Management Corporation, a taxi dispatcher at the corner of McGuinness Boulevard and Huron Street just south of the Pulaski Bridge, since 1996…

For the last seven months, Kiouvas has come into work at 7:30 a.m., and methodically moved dozens of unused yellow cabs out of their parking spaces on surrounding residential and industrial streets, in order to avoid parking tickets…

Dozens upon dozens of yellow cabs have been shuffled this way for the better part of the year, throughout the blocks contained by Huron Street to the south, Freeman to the north, Provost to the east and Manhattan Avenue to the west. McGuinness Management is the heart of what one frustrated neighbor recently dubbed the "taxi graveyard."

Hossam Yossri has been working at McGuinness for five years. "Business is getting so bad, that people are just dropping their cabs off here," he told us on Tuesday. "Everyone is going to Uber, where they don't have to pay a lease, and they don't have to deal with a dispatch."….

As the number of drivers continues to dwindle, between 80 and 120 cabs sit empty on any given shift. Yossri recalls one day recently when there were only enough drivers to send out 24 cabs, and 147 of them sat empty.

My November 2014 feature on the rise of and regulatory fights against Uber and the other companies in its space.

Jim Epstein on the most recent quelling of attempts to hyperregulate Uber in NYC; attempts that we can be confident we'll see rise again.

NEXT: Ohio Likely to Ban Abortion of Fetuses Diagnosed With Down Syndrome

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    1. The problem with competition is that SOMEONE MUST LOSE!!

      We need a cooperative taxi industry, not a competitive one. It’s time to ban Uber and the other “competition,” and allow New York’s Taxi commission to set an intelligent, equitable policy that will serve ALL New Yorkers.

      1. Can I suggest an “Anti-Dog-Eat-Dog” law?

      2. My sarcasm meter is in the shop this week. Can someone translate this for me?

        1. It’s from Atlas Shrugged, or at least the “anti-dog-eat-dog” law is. Not 100% sure on the rest, as it’s been awhile since I’ve read the book.

  2. *insert Nelson “Ha ha!” picture*

  3. Those poor buggy-whip makers! Something must be done!

    1. No miniarchism, no protectionism.

      No miniarchism, no cabbie monopoly.

      No miniarchism, no medallions.

      No miniarchism, no barriers to entry.

      No miniarchism, no filthy, foul, fetid taxis.

      1. Now my sarc meter is on the fritz.

        Unless you really think licensing of cabs is something a minarchist government would do?

        1. On a long enough time line, yes that’s exactly what they would do.

          1. Not if you beat them down with a big stick every time they outgrow their “minarchism”; cleaning house from time to time is never a bad idea.

            1. That’s worked out so well so far

              1. That big stick was needed in about 1820. We’re so overdue now we need something more substantial. And hence, the “corrective measures” are likely to be far more painful.

            2. true, but it also never happens.

              1. Of course, anarchy probably also fails for similar reasons.

          2. On a long enough time line, that’s what every system does. The “eventually” argument is so lame and banal.

        2. Consider the source. I believe it is an argument for anarchism.

        3. The problem with minarchists is they want to implement the same mistake over, that is gov’t. They believe somehow socialism is magically effective and that top men are only able to manage defense or ROaDZ!!

          History tells quite a different story. Private defense, (before being signed away when luckily for the gov’t liberty was fresh in the people’s minds) was far more efficient and effective than the navies of the “state”.

          Minarchism is mini slavery. As it too must survive through violence.

      2. NYC taxis are limited out of necessity. They’re mostly near-new in 2015, many are hybrids. No barrier to entry in NYC = massive over saturation, desperate drivers who make nearly nothing. But this is fantasy lalaland, where the only thing that matters is what the ‘customer’ sees. Btw, Uber churns through drivers, very few can make it full time the rest are tossed on the garbage heap as Uber keeps lowering its per mile rate and raising it’s cut. Exactly what Medallions prevent.

  4. From the comments:

    Uber is threatening to destroy our cab system. When its gone, you will regret it.

    Can someone please explain to me why I would ever regret this? Existence bias towards public roads or public schools makes a little sense, but existence bias against the fucking taxi industry?!?! wtf.

    1. That person is probably the type who was horrified to learn that eyebrow threaders in Texas no longer need 750 hours of training.

    2. It’s so common. I don’t fucking get it either. Taxis are the fucking worst. “Regulate me! Regulate me more, Daddy!”

      1. I know the taxi company I drove for had a few nice sweetheart deals with the local politicians starting with a virtual monopoly via near impossible to meet criteria for a potential competitor.

        1. A lot of the Uber hate is based on all the Gawker Media blogs bashing at every chance they get. I bet Denton missed out on buying it out early or something equally petty.

    3. For people who supposedly believe in progress and evolution, a lot of leftists sure do have problems with actual changes.

      1. Leftists worship stasis even worse than conservatives do. It may be the creepiest thing about them.

        1. Any laws we shouldn’t break in the name of ‘innovation?’ Maybe I should open a factory next to yours, produce the same item, but squirm out of having to pay property tax or install safety equipment, in the name of ‘innovation. It will let me undercut you and you won’t be able to compete, but it’s all great because… ‘innovation.’ Right?

    4. The cabbie who wrote that is convinced you’ll regret his expensive, smelly and shoddy service.

    5. Uber is threatening to destroy our cab system by offering better service for less money. When its gone you can get a better ride for less money, you will regret it.

      Hmm. Not sure why.

      1. Because they avoid the cost of the Medallion entirely by falsely claiming they do pre-arranged rides, not on demand e-hails. Weird that you think individual owner operators should have street hail rights handed to uber for nothing while they paid a lot of money.

  5. Stop it, Reason! My heart cannot bear to read such tales of misery and woe. Truly the US is now entering its Somaila phase. MUH ROADZZZZZ!

    1. You laugh, but what will you do when all the roads disappear?

      1. Make a passing observation of this fact from my flying car?

        1. ha!

      2. I assume they will have disappeared due to the invention of flying cars.

        1. Fuck a flying car. I’m’a teleport ERR’YWHERE.

          1. You’ll die a dozen times a day.

  6. What’s stopping these underemployed taxi drivers from being Uber drivers?

    Lack of their own vehicle can easily be solved by leasing a car, it seems to me.

    Anything else?

    Tangential fact:

    Right now, this country is hugely undersupplied with, wait for it, . . . farriers. The folks who do horseshoes and stuff. Seriously. There are a ton of horses in this country still, maybe even more than when they were a prime mode of transport, and not nearly enough folks to keep them shoed.

    Markets are funny that way. Who would have ever predicted that the machine age would create a tremendous unmet demand for farriers?

    Not sure what to do with this factoid, but it seems somehow relevant to the disruption of yet another industry.

    1. As I read the article, that’s where all the cabbies have gone:

      “Everyone is going to Uber, where they don’t have to pay a lease, and they don’t have to deal with a dispatch.

      1. Yeah, but won’t you think of all the poor unemployed dispatchers?!?

    2. Lack of their own vehicle can easily be solved by leasing a car, it seems to me. Ohhh I hate to get this picky…. That would have to be one super, mega high-mileage lease to drive Uber full time…

      1. …or you make enough to buy the vehicle when the lease ends

  7. This weekend I was in Northern Virginia for a wedding. The folks planning the wedding arranged for taxis (with a taxi cab company) to pick us up at 4:30 and 4:45 before the wedding, and again at the end of the night.

    The 4:30 taxis didn’t show up until 4:40, didn’t leave until 4:50. I’m not sure about the 4:45 taxi.

    At the end of the night, there were no taxis to be found. I called the company (they had given me their number) and in “not the best” English I was told that other guests had said they didn’t need a ride, and that “no one picked up the phone” and therefore the driver left. First of all, there were two different hotels, so the folks at the other hotel used the other service. Second, if you brought three cabs worth of people, wouldn’t you expect to take three home? At least wait around for a while.

    Anyway, we solve our problem by calling an Uber. We got back to the hotel 10 minutes later.

    1. solved*, damn it.

  8. Uber has got a serious case of over-valuation in the private equity markets right now. It’s approximately 65x their total sales. Not earnings… sales.

    They’re going to pop soon.

    1. So what you’re saying is that at this very moment I should take out a second mortgage on my home and buy all the Uber shares I can get my hands on?

      1. Yes.

        You should also buy Volcano Insurance – and I can offer you a great rate!

  9. *searches for hanky with which to dab tears*
    Tears of laughter, that is.

  10. But I paid a lot for these medallions…

    1. Indeed. Perhaps go complain to the government you bought them from and tell them that they are defective and no longer work – you’d like your money back.

      1. That’ll work for sure.

  11. Right now, this country is hugely undersupplied with, wait for it, . . . farriers. The folks who do horseshoes and stuff. Seriously. There are a ton of horses in this country still, maybe even more than when they were a prime mode of transport, and not nearly enough folks to keep them shoed.

    My brother knows a guy who shoes show and jumping horses. People fly him all over the goddam country, apparently.

    1. Baggage charges on the anvil must really drive up the expense report.

      1. So long as you put it in excel and make fancy spreadsheets, who cares?!!!

    2. That sounds like a cool job.

      1. Until you get kicked in the head by a horse.

    3. Time to get me a forge and some shoein impedimentia.

    4. In other words, Uber should be allowed to break the law and not pay for a Medallion because their app is a hi tech clever way to claim what they do doesn’t do virtual street hails. Yet it functions as one and is used as one. Why have any laws, just frame whatever you don’t want to pay for as ‘antiquated.’

  12. My feet are so damned big, I might as well hire a farrier to shoe me. Put some rubber in between there and off I go, sparkin up the road.

  13. Yossri recalls one day recently when there were only enough drivers to send out 24 cabs, and 147 of them sat empty.

    Uhm, ever thought about dropping your fees?

    Oh wait – you can’t do that due to legal restrictions hanh?

    Live by the sword, die by the sword motherfucker.

  14. This is obviously good for the taxi drivers. They get a raise now by switching to uber, and the taxi companies will have to cut the lease rates going forward.

    1. No they won’t, they’ll just go out of business. Legitimate taxi garages can’t compete with a ‘virtual’ taxi which is allowed to do virtual street hails without actually paying for the Medallion.

  15. No, it’s just very harmful destruction of legitimate business by being allowed to break the law. There are 6,000 individual owner operator yellow cab drivers in NYC (42%), so you’ll have to fine another line of bs than claiming ‘taxi moguls’ deserve to be destroyed. Those ‘moguls’ also run garages which pay for the Medallion and buy/maintain/repair the cars, which allows drivers to work part time. Uber is just doing virtual street hails without paying a cent for a Medallion. Allow any business to sidestep the major costs of operating like that and they can undercut everyone too. Uber isn’t even required to take cash, use a set metered rate, or have wheelchair accessible vehicles. And I love how they try to exploit the lie that yellow cabs don’t go the boroughs. Yes, there are occasional declines, but yellow cabs must take cash by law. Every Uber outer boro trip is a guaranteed credit card ride. And with ‘legal’ price gouging. Uber gets to cherrypick everything it wants, and pay zero for a Medallion.

    1. God damn it, nyctuber. How is this for “another line…”

      Nobody gives a fck about your stupid fcking Medallions.

      1. Brilliant, just break the law. Break every law, because… ‘innovation.’

        1. I think what Uber is showing is that most people do in fact prefer “innovation” over your God damn “Medallions.”

          Medallions suck, and the sooner you get over them the better.

          1. No, it’s showing that when you illegally avoid most of the costs of doing business, you can show the ‘customer’ a pretty face. Medallions are the law, you don’t get to just break the law, period.

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