London’s Black Taxis: evolving is your only chance of avoiding extinction

About a month ago an organisation called SaveTaxi created a petition on the website that pleads with the Mayor of London to “enforce the guidelines and regulations” in order to “save our black taxis”. I only found out about it today, however, when someone in my facebook community shared it and it popped up in my timeline.

This petition is yet another episode in the black taxi mob’s bitter backlash against taxi app firms like Uber and Hailo, which by virtue of being cheaper and better than licensed and regulated taxi companies have quickly become every Londoner’s preferred way to get a taxi ride.

The author(s) of the petition’s statement essentially argue that it’s in the best interests of the public that the government acts to enforce regulation and licensing upon its competitors, but the body of arguments amounts to nothing more than special pleading to be protected from superior competition by government. Sadly, the petition has nearly 9,000 supporters and so it’s worth taking a moment to address each argument in order and refute them.

The petition’s statement opens as follows:

“Established by Oliver Cromwell in 1654, London’s iconic black cabs are the oldest and the most regulated public transport system in the world…the Licensed London Taxi trade is now being threatened with extinction, due to TFL’s lack of enforcement of their regulations – regulations that they, themselves, established in order to keep London and its visitors safe! “

London’s licensed taxi trade is facing extinction precisely because it’s the most regulated public transport system in the world, not because of what government is or isn’t doing; it’s facing extinction because from the radically and rapidly life-altering world of technology and the Internet has emerged a better solution – that solution is essentially being able to quickly get a taxi ride via an app on your smart phone and pay electronically. That’s what social progress is: individuals creating better and cheaper ways to do things.

The petition continues:

“Over the past 18 months, the face of London has significantly changed – approximately 20,000 private hire vehicles have hit the streets. This number is increasing at a rate of 1,500 new private hire vehicles per month. This is, quite simply, unsustainable.  Levels of work are dwindling whilst traffic is increasing. In contrast, the number of applications to become a Licensed London Black Taxi driver has seen a decrease by around a third.”

I am assuming that these figures are reasonably accurate. I also assume that Uber and Hailo, another popular London taxi app firm that a year ago expanded its service beyond black cabs and to include private hire vehicles, are the major catalysts of these changes – although these companies are never mentioned by name in the petition.

The number of private hire vehicles hitting the streets reflects the rising demand for taxi app companies like Hailo and Uber’s services. The assertion that the rate is unsustainable seems to be based on the premise that this same rate will continue for all eternity! It obviously won’t do that. It will increase until Uber and Hailo believe they have enough drivers to meet demand, and then it will level out.

The petition then moves onto some vague scare-mongering:

“The unprecedented rise in numbers has caused increased congestion, pollution, and is creating a problem with illegal parking. The rate of accidents has significantly increased, due to drivers not being familiar with, or having any knowledge of the streets of London…”

Congestion would be less of a problem if public transport wasn’t so expensive, and it’s expensive because its provision is monopolised by government. I recently took a Uber taxi and the cost per mile was approximately the same as travelling on a London bus, but it was obviously a much quicker and more comfortable journey.

Parking is also a problem exacerbated by government control. Because enforcing parking regulations is a great source of easy money for local councils the number of places to legally park across London boroughs shrinks over time and the number of areas where it is illegal to park expands over time. Quite often, parking someone where parking is illegal doesn’t actually inconvenience or obstruct anyone else (which is supposed to be the very purpose of government-enforced parking regulations). It just means local government gets to extort money out of you.

Even if it is true that the rate of road accidents in London has increased over the past 18 months or so, the claim that this is because private hire drivers have less knowledge of London’s streets than black taxi drivers is baseless (driver behaviour is the predominant factor determining risk of accident, not knowledge of streets).

This is simply an unscrupulous attempt to convince the Mayor of London (and the public) that private hire vehicles working for taxi app firms like Uber and Hailo are causing more accidents in London – and therefore that subjecting them to the same regulations as black taxis would reduce the rate of accidents in London (whilst rather conveniently restoring the black taxis unjust monopoly position in the market). In short, the black taxi mob is here disguising their desperate pleading for the government to protect their racket through the use of coercion as selfless concern for public welfare.

The petition goes on:

“These vehicles are not obligated to comply with the strict regulations that are laid down to protect customers; the very same regulations that Licensed London Taxi Drivers are forced to strictly adhere to!”

Oh how quickly a special interest group, which has been benefiting from State-granted economic and legal privileges for so long, can suddenly turn against forceful government control when their protective bubble bursts. Only now, in the presence of unencumbered competition, does the black taxi mob see how restrictive and costly government regulation is to businesses providing services.

Before the technological means arrived to make taxi app firms like Uber and Hailo a reality, the black taxi mob couldn’t get enough State-licensing and regulation because these raised the cost of entry to the market and restricted access to the market to such a degree that it was able to enjoy a monopoly for centuries. But now the State’s control over their behaviour is like a giant weight on their shoulders. What was once their greatest strength has become their greatest weakness, and so it will remain if Uber and Hailo aren’t subjected to regulation by the government as per the wishes of the black taxi mob.

If black taxi drivers and their supporters are genuinely concerned with providing the best and most cost-effective taxi service for Londoners, then they should be asking to be set free of government regulation – not demanding that it be forced upon others whose only crime has been to create, finance and implement a better (as determined by the huge popularity and roaring success of Uber) of doing taxi services.

If its competitors remain unregulated, then the only hope London’s Black Taxis have of competing with the likes of Uber and avoiding extinction is through adaptation and innovation; through actually responding to the changing preferences of Londoners like any normal company providing a service must do, instead of forcing everyone else to adapt to them through more government action because they’ve convinced themselves that this benefits their customers. It doesn’t. State-maintained monopolies always put upward pressure on cost and downward pressure on quality, which ultimately hinders the raising of everyone’s standard of living.

To London’s Black Taxis I say this. Abandon the blunt instrument of government. If you’re the best as you claim, then please show us. Find a way to give us Londoners rides in your iconic black cabs at prices that are competitive. If that is possible, then the very real threat of the loss of your livelihoods and London’s black taxi service should be plenty of incentive to make it happen.

Until recently, as a result of being shielding from market forces by the State for so very long, London’s Black Taxis haven’t needed to, but now that the taxi market is operating more freely than it has in a very long time the truth is unavoidable: only those who attempt to evolve can possibly avoid extinction. And only those who do deserve to avoid going extinct.

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