Impressions of the San Francisco Taxi Workers Alliance

Since I'm working with impressions instead of facts, I think it's best to start with photos. They tell most of the story. Nine out of the eleven member San Francisco Taxi Workers Alliance (SFTWA) board are in this shot. Another is included below sitting behind a National Taxi Workers Alliance (NTWA) organizer who is speaking in the following photo.

The final member of the board is Rua Graphis of the United Taxicab Workers (UTW). The SFTWA represents the merger of the UTW and the San Francisco Cab Driver's Association (SFCDA) with a bunch of guys I don't know and who haven't, except for an occasional protest, been part of the SFMTA's decision making process for the last five years. Not that this is necessarily a bad thing. I'm not enamored with many of the people who have been part of that process.

The person most responsible for bringing all these different groups together is the blond at the table, Beth Powder, who is a film maker and short time cab driver with clearly exceptional organizational skills.

Fleet Taxis and Employees

The dawn of the New Year seems a good time for exercises in nostalgia and theory.

President of Desoto Cab, Jane Bolig, wants a return to the good old days when cab companies owned corporate permits. In a TaxTownSF post,  Remembrance of Peak Times Past, she writes that San Francisco didn't need Peak Time permits back in the good old 60's because Old Yellow Cab owned its medallions and didn't have to pay the medallion holder the fees that cripple companies today.

"To pay them (the fees),"  Jane says, "they (the cab companies)  have to put out all their cabs every shift, every day of the week, every week of the year. That is why drivers fight for rides most Sunday mornings and passengers can’t find cabs any Friday night."

Old Yellow was apparently so profitable that they could "hold back unneeded cabs (sometimes equaling 40% of its fleet)" on slow days and put cabs out when it was busy. "It’s why we discuss peak time medallions in 2010," Jane says, "and why we didn’t in 1968."

The thrust of Jane's essay is that allowing cab companies to have fleet medallions would cure all our peak time problems.

Simple as that!

Unfortunately, Jane is leaving out parts of the equation. Back in the good old days, cab drivers were all employees and belonged to unions. The real reason why Old Yellow didn't put the taxis out at slow times was that they split the meter with the drivers - to whom they first had to pay minimum wage. It wouldn't have been profitable for the companies. In fact, they could have been the ones losing money on bad shifts instead drivers who can't cover their gates today.

Jane also seems to be envisioning combining fleet taxis with a "gates & gas" system. Well ... it certainly would be a way for taxi companies to maximize profits but would they really hold back cabs on slow days? During a recession when people are desperate for any kind of work?

We're talking about the characters who currently manage cab companies in San Francisco - not in Shangri la. In short, fat chance.

Ms Bolig appears to be waxing nostalgic about the other side of the problem as well by assuming that Old Yellow covered the City better back in the good old days. Was this true?

I have word-of-mouth, anecdotal evidence that the service really was better in the neighborhood but this was largely due the fact that companies split the meter and paid minimum wage to the drivers. The companies made their money by actually dispatching taxis to pick up orders and drivers could afford to work areas like the Sunset or wait at the cabstands which were spotted around the outlying areas of the city.

But, how about coverage at peak times and on Friday nights?

San Francisco had a population about 10% lower than it does now and about half as many taxis. 1968 was peak time for the Vietnam war. Sailors and solders embarked for Asia from here. According to the old, old timers this was one of the busiest eras in San Francisco taxi history.

So ... Right Jane,  nobody waited for a cab back then.

The Independent Contract - In Sum

Over the last 30 years, the law has pretty much caught up with the Independent Contract. A series of court cases have given drivers Workers Compensation and, maybe, Unemployment. It's no longer legal for companies to demand insurance deposits from their drivers.

It's also true that I have probably romanced the virtues of being an employee. It's doubtful that, under the political climate of the last three decades, we would have been able to form a union even if we been given employee rights. Unions have hardly proven themselves to be bastions of morality either. A friend of mine, in a Longshoreman's Local, had to tip union agents to get shifts. And, the foundations of building have been poured on many an ex-Teamster.

The level of corruption seems to be about the same. On the other hand, union workers are usually much better paid.

But there are advantages to driving a cab as an Independent Contractor. It's a cash business and nobody tells you what to do. You can take radio calls or not, work the airport or not, use any system you can think of to make money and take breaks (or not) any time or any place you like. Furthermore, an economic recession is unlikely to cost you your job. All that happens is that you make less money. In fact, people laid off from other industries invariably swarm taxi companies looking for work during recessions. Most of them make less money driving cab than they had been making before but at least they make something.

Comparing lease drivers to workers in 19th Century sweat shops is also way off the mark. You can do what you want when you drive a cab and, benefits aside, taxi driving pays better than most clerical or retail jobs. The combination of the freedom and cash is what got me into the business - and what keeps me there.

However, the biggest advantage of the Independent Contract clearly goes to the companies. The ability to fire people (excuse me "cancel their leases") without cause has given cab companies way too much power and led to abuses that I've written about earlier (see Alleged Tipping and the series on the Independent Contract). Beyond that it has saved the companies huge amounts of money that they have not had to pay in the way of taxes and benefits.

The gates and gas system has also made the taxi industry recession proof. Although the taxi business is currently down (by most accounts) 30% to 50%, the companies are flourishing. Former stock brokers, computer geeks, money managers and (god knows) maybe lawyers are lining up to drive cabs. But they can't even get an application. The companies are backlogged with drivers. They aren't hiring.

I guess the question is whether or not this is a good thing. As a medallion holder, I appear to be benefitting from this system. But I wonder? Is is right for companies to be flourishing when the amount of actual business they do is in decline? Is it right for them to be protected from the laws of the marketplace?

Most the plans for "reforming" Proposition K, for instance, call for putting more taxis on the street. The people who drew up these plans act as if the current recession didn't exist. As such, these plans as disconnected from the economic realities of our time. Would this be happening if the companies were actually in the cab business instead of the leasing business?

Is the public truly being served by this system? The major complaint about the taxi service in San Francisco is that it's hard to get a taxi in the outlying neighborhoods. But a company cannot tell an Independent Contractor what to do. That would make the driver an employee. Therefore, the companies cannot assign a driver to a call or tell him or her to work a specific area or neighborhood. Because the drivers themselves are on a gate system, they cannot afford to stay in neighborhoods with little business and naturally head back toward the busy areas as fast as they can.

Because the City has not allowed companies to raise gates thus shrinking their income and to avoid legal problems arising from the current system, taxi companies are more and more going to long term leases. They give up their day to day control but they don't have to sweat the details either.

This is a big problem for dispatchers by the way. The days of FIVE in and FIVE out are becoming a thing of the past. They're lucky if the long term lease drivers toss 'em TWO a couple of times a month ... and that's how it should be.

However, it's difficult to see how the long term leases serve the public. Most of the drivers appear to work the airport and the companies have no control over them whatsoever. It's hard to envision these guys spending a lot of time in the Sunset taking radio calls.

I'm tempted to say that I think the system is broken and needs a drastic reform. In fact, in an earlier version, I did. But that's a drastic exaggeration. I got carried away by my own rhetoric.

On the other hand, the public isn't being served as well as it should be, the drivers are treated unfairly and the companies themselves might do better under a different set up.

The gate and gas system may be outdated. As it is the only way the drivers can make more money is by raising the fares and the only way the companies can make more money is by raising the gates. The fares are already among the highest in the country and it's hard to see how raising them now would do anything other than lose business. The gates are already too high for the amount of business we have.

There has to be a better way. All we need is a Solomon to figure it out.