The San Francisco cab industry works as a medieval class system
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There's a new move afoot, this time through a lawsuit, to change the way taxicab permits work in San Francisco. Rachel Stern lays out the story on page 14, but allow me to offer a bit of political background:
The San Francisco cab industry works as a medieval class system. There are members of the landed gentry people who have medallions, or operating permits and there are serfs, people who drive cabs but don't have permits. The serfs fork over a significant portion of their income every day to the gentry in the form of lease fees, the same way the peasants used to fork over much of their income for the right to live near a castle or hunt or farm on the gentry's land. See, you can't drive a cab without a permit, and if you don't have one, you have to lease one from someone who does.
Drivers are all independent contractors, so they get no health insurance or disability and retirement benefits.
In this particular economic world, even the permit holders aren't getting rich. The only ones who really make out are the top royalty, the cab companies themselves. But the gentry do a lot better than the serfs.
What's interesting, though, and wonderful in its way, is that thanks to a 1978 law backed by that well-known Marxist former supervisor Quentin Kopp, you can't inherit your way into the landed gentry. You can't buy your way in, borrow your way in, or marry your way in. The only way to become a medallion holder is to put your name on a list and wait, along with all the other serfs, until, after 15 years or so, a permit opens up.
And the way a permits opens up is that someone who has one quits driving.
That's the deal Kopp put together: only active, working drivers are supposed to get the benefits of the medallions. No corporations, no partnerships, no trusts, no relatives.... You personally drive a cab 800 hours a year, and you're eligible to lease your permit out during those shifts when you're not using it.
Of course, once a driver becomes a member of the landed gentry, he or she never wants to give up that permit. It's free income, maybe worth $2,000 a month. The Medallion Holders Association desperately wants its members to be able to keep their permits when they retire, or be able to give them to their kids, or somehow cement them as property that a person can own, just like the forests and fields of the landed gentry of yore.
The latest issue is disability. Suppose you wait patiently for 15 years, suffering in serfdom, and your number finally comes up, and you get that golden ticket and then you get in an accident and lose the ability to drive a car. I get the point; maybe there ought to be some transition program or something. But every time a nondriver gets to keep a permit, a serf waits even longer in line, forking over hundreds of dollars to a member of the gentry who doesn't want to play by the rules anymore.
The bottom line is, cab permits belong to the city, and they aren't supposed to be someone's retirement fund. I don't like any sort of rigid class system, but if you're going to have one, the serfs deserve fairness too.<\!s>*