A Short History of San Francisco's Taxi Crisis: Bigoty & Cabbies, Part 2

When Mayor Newsom discovered that he was $600 million in debt, one of the first things he DID NOT DO was tell the people of San Francisco that he was going to cut back on their bus service. Instead he came out with his plan to "improve" taxi service by taking taxis away from cab drivers, auctioning them off and keeping the money for the city.

People in San Francisco take ten times more buses than cabs. In short, the issue was and is a red herring, a pump fake, a sound bite designed to take the public's mind away the fact that they are going to be waiting longer for buses.

Mayors from Dianne Feinstein on have used taxicabs for similar ploys, but Newsom is the first mayor to claim that he could improve taxi service by attacking San Francisco's cab drivers.

His justifications rest on a series of half truths coupled with assumptions that are essentially racist. But first - the facts, just the facts.

San Francisco has a unique cab system.

• Taxi medallions are not for sale. They are leased to drivers on a first come first serve basis.
• There is a waiting list to get a medallion that is currently 3,000 applicants long.
• The wait for a medallion is about 15 years.
• The medallion goes back to the city when a medallion holder either stops driving or dies.

Now some half truths followed by facts.

Half truth: Auctioning off cabs would give more taxi drivers a chance to own one.

• Fact: Almost 1,400 out of 1,500 of San Francisco's taxicab medallions are owned by individual drivers. About 1 driver in 5 owns a medallion. In other words 90% of the taxis are owned by individual drivers. This is by far the highest percentage in the country.
• Fact: In New York City by comparison, 5,525 out of 13,107 are owned by individual drivers. This works out to 42% of the medallions - less than half the percentage in San Francisco.
• Fact: Johnny Marks of www.nycabbie.com/ writes: "That % (the 42%) sounds a little high, what with the cost of the city license (medallion) presently going for $750,000.00 which does not include the cost of the cab itself."
• Fact: According to the Asian Law Caucus only 1 driver in 20 can afford to buy a taxi in NYC.
• Probability: Most of the cabs in NYC are actually owned by people financing the cab drivers, not the drivers themselves.

Half truth: According to Mayor Newsom's man at the MTA, Director Malcom Heinicke, taxi medallions are "essentially free."

• Fact: The medallions are not dropped from the sky or won in a lottery.
• Fact: A driver puts in an average of 15 years of hard labor to get the medallion and pays about $200,000 in rental fees. Therefore, the medallion is "earned" not free.

Half truth: Aging medallion holders are not working and because of this the service is bad.

• Fact: About 20% of the medallion holders are indeed too old to drive. This does not, however, mean that the cabs are sitting idle. Ordinary drivers work the cabs when the medallion holder doesn't. Almost every cab in the fleet is in operation 20 hours a day, seven days a week.

Doublethink: According to Newsom, "If drivers had more of a stake in their industry ... that could translate into better service for the customers."

• Opinion: I don't see how somebody would have "more of a stake" by getting a cab in an auction than working 15 years to own one.
• Fact: If you own the medallion you own the medallion. It doesn't matter how you got it. The stake in the industry is the same.

There are subtexts to Newsom's arguments that basically racist. He's morphing the stereotypes formally associated with blacks. What's he's saying in other words is:

• The service is bad because the drivers are lazy.
• We're paying them too much money so they aren't working.
• If we pay them less (put them in debt to pay for the auction price) they'll work harder.

Newsom has no idea if the cab service is good or not. (The average waiting time in front of his most famous restaurant, The Balboa Cafe, is about 15 seconds.) But Newsom does know that he can always gain political points by appealing to people's prejudices and bashing "cabbies."

• The truth is that the medallion system has created a class of professional drivers. The promise of being able to own a medallion someday keeps experienced drivers in the business.
• Fact: San Francisco has the most knowledgeable cab drivers in the USA.
• Fact: Replacing San Francisco's veteran drivers with deep-pocket newbies would most certainly make the service much worse.

The idea that medallion holders aren't working because they make too much money is absurd.

• At one public hearing, a woman claimed that medallion holders weren't working because they were home eating pizzas. Did she mean to say that they were home eating watermelons?
• Facts: Medallion holders average about $45,000 per year. The average salary in San Francisco is $65,000. Medallion holders get paid $2,000 a month to lease out their cabs. Studio apartments start at $1,500 per month. Most cab drivers can't afford not to work.

According to a source who wishes to remain anonymous, Newsom came up with a plan when he was a city supervisor to solve the homeless problem by detoxing homeless people and having them drive taxicabs.

Newsom's callous disregard for the fate of the drivers is certainly consistent with this attitude. In his world, cab drivers are lowlifes and undesirables. They are not "one of us," not real San Franciscans. If the drivers are too old, you just take the cabs away and let them fend for themselves. If they waited 15 years and paid $200,000 in fees with the idea that they were going to own something at the end of it, that's their problem.

This is the way you treat a member of an underclass, not a fellow human being.

When these stupid, lazy cab drivers mounted a series of protests against his plan, Mayor Newsom had his man Heinicke take it off the table.

This was in March 2009. But that wasn't the end of the matter. Only the beginning.

Gavin Newsom Tries to Shaft the Medallion Holders

Mayor Gavin Newsom, who has fought against a business tax that he himself would have to pay, seems to have the wind at his back in his attempt to force taxicab owners to auction their medallions to pay off San Francisco's debt. In fact, a local newspaper poll showed 51% voting in favor of such a measure because the "city could use the money" while only 36% thought that the "current holders need the income."

Newsom of course has the stereotype of the greedy cab owner working in his favor. But perhaps more important are innumerable newspaper articles stating that medallion holders make $70,000 per year just by leasing out their taxies. 

Sounds like a lot of money, doesn't it? Especially for a bunch of lowlifes.  I kept running into this figure over and over so I decided to do something that local "journalists" have clearly never done themselves: I researched the subject.

• I asked several medallion holders about their incomes and they all said that they were coming up about $50,000 short of the factoid. When I asked them what they thought had happened to the money most of them didn't have a clue but one opined that Officer Makaveckas might somehow have gotten his hands on it.
• Seriously ... the $70,000 figure is arrived at by simple arithmetic. The leasing rate for a shift averages about $100. There are two shifts per day and 365 days per year = +70,000.
• The problem with simple arithmetic is that it's too simple. What is needed here is a little simple subtraction. The $70,000 is a GROSS: before the taxicab is bought, before insurance, before paying for the property on which to store the cab, before maintenance, before the property taxes, before the salaries for bookkeepers, accounts, lawyers, dispatchers, mechanics and other expenses are taken out.
• The medallion holders usually let the cab companies take care of the above details and split the money with them for the right to lease out the cabs to other drivers. The medallion holders average about $20,000 a year from the split. I don't know the companies' share. 

Now $20,000 might be a lot of money in San Francisco Del Mar, Mexico but in San Francisco, California it's barely enough to rent a studio apartment. That's why 85% of the medallion holders also drive cabs long hours themselves, bringing their yearly total up to $30,000 to $50,000 - which might get them a one or even a two bedroom rental but will never be enough to buy a house. This after working for at least 15 years in one of the most dangerous jobs (cab drivers are more likely to die by homicide then policemen) there is. By comparison:

• San Francisco policemen and policewomen earn  $75,868 to $101,556.
• Firefighters base pay averages $54,000.
• Muni bus drivers get a base salary of $56,000.
• AC Transit drivers start at $40,560.
• BART drivers make $64,296.
• All these groups have medical benefits, paid vacations, sick leave and retirement benefits.
• The benefit package at BART is worth over $29,000 per year.
• Most of these people could also  work overtime -  at least before the eco-tsunami hit.

The medallion holders:

• Have no benefits of any kind.
• No retirement.
• Pay the city one million dollars a year in a tax on the medallions.
• Pay the same 15% self-employment tax as regular cab drivers.
• Will have the City of San Francisco try to take their medallion away if they become old or disabled.
  

Mayor Gavin Newsom, to make another comparison, regularly makes in excess of $400,000 per year and has made more than $1,000,000 in a year on at least one occasion.

You can see why a man with Newsom's sense of fair play would hesitate to pay a 1.395% business tax.

A Breathe of Fresh Air

At a Taxi Town Hall meeting on 3/10/09, Chris Hayashi, the new Director of San Francisco's Taxis and Available Services showed herself to be a refreshing change from her predecessor on the Taxi Commission, Heidi Machen. Whereas Machen had treated the drivers with overbearing arrogance and privately referred to them as "either criminals or people who soon would be,"  Ms. Hayashi clearly regarded a room full of owners and drivers as respected equals.

She discussed and listened to their opinions concerning the various plans to change how the taxi industry operates in San Francisco.  After a general conversation about possible scenarios, she led an examination of  proposed taxicab rules in the San Francisco Transportation Code.

Ms. Hayashi either changed or eliminated several provisions that drivers objected to including an obscene "snitch" rule that would have taken away the medallion of any owner who had failed to turn in another owner whom he or she knew to have been arrested or convicted of a crime. Such rules have a long, inglorious history and have been used by people as diverse as the commie dictator Joseph Stalin, the anti-commie witch-hunter Joe McCarthy and the Christian Brothers of Cretin High as techniques to humiliate and destroy their enemies. Heidi would have loved it. 

However, the subject that aroused the most passion among the drivers, limousines, wasn't even supposed to be on the agenda. Ms. Hayashi kept telling drivers that it would be discussed at a future date but, they kept bringing the subject up, so she finally promised that the Taxi Detail was going to hunt down, punish and eliminate illegal limos in San Francisco. Among other ideas, she proposed impounding their cars for 30 days when limo drivers were caught violating a law. "That should put a stop to them," she said with a smile.

Hayashi's attitude and approach stands in such sharp contrast to the Mayor's arrogance and indifference toward cab drivers' fates that I can't help wondering what's really happening. 

Historically, Mayors like Diane Feinstein and Willie Brown have used commissions and hearings as way to rubber stamp their own plans while giving them the veneer of democratic processes.

This does not appear to be what is going on here. Or is it? No one I've met has a bad word to say about Chris Hayashi, but it's unclear as to how much power she actually has. It may be that she's an unwitting pawn in an elaborate good cop/bad cop scheme designed by Newsom.