> "who used what some considered to be “underhanded tactics,” such as drastically lowering fares, to get more business."
Lower fares is not the only consequence of this type of free market. In NYC we've seen a rise of intercity buses competing at cut-rate prices, and one such bus company recently and spectacularly failed every single safety inspection performed on their vehicles. They also have an accident rate several times that of their less price-sensitive consumers (Greyhound, Amtrak, etc).
Free markets often have substantial downsides, it's dishonest to pretend that regulation is strictly driven by parasitic behavior. There are also substantial upsides to commoditization - i.e., gains in efficiency when every consumer does not have to engage in complex analysis of the product on every sale. There is a loss of market confidence when you have to go through a mound of paperwork just to determine which intercity bus line is safe to ride.
When a market is over-regulated, such regulation often have legitimate and still-relevant roots. Those who cry for complete deregulation would be wise to figure them out first. Regulations may run amok, but they very often still sit on top of a legitimate need.
You say, "it's dishonest to pretend that regulation is strictly driven by parasitic behavior," but I was just quoting directly from the nyc.gov site that explains that's exactly why those regulations came to be.
You can argue separately for safety regulations, but that's not why NY started to regulate cabs - it was protecting an existing industry from competition. Also, put yourself in the 1935 mindset - was there even auto insurances? were there seat belts? The risk profile people lived with was much different.
> "Also, put yourself in the 1935 mindset - was there even auto insurances? were there seat belts? The risk profile people lived with was much different."
Indeed, and that's precisely the start of much industry regulation. Not just taxis, but railways, boats, and all other forms of shared transport. Transportation safety was a Big Deal in the early 20th century, and the market did differentiate itself on that point - but there was also little regulation or oversight to ensure that claims of improved safety were actually real (see the most infamous example in the Titanic).
Mandated seat belts, car insurance, brake mechanisms (e.g., trains), speeds, inspections. All of these were borne out of necessity. The lack of safety in the 1935-life is why we are living with so many regulations today.
Our history seems to go: new technology, a lot of people are killed by new technology, regulation to improve safety of technology.
The "let's deregulate everything!" angle is just winding back the clock. To before the regulations became onerous and excessive, but also to before the regulations saved a lot of lives.
> it was protecting an existing industry from competition
Otherwise known as "keeping people employed at a living wage." When the market decides that human labor is worth nothing, it's irresponsible not to contradict it.
I will agree that medallions should have gone away after the crisis, but it wasn't "parasitic" at the time.
You can also spin this as "keeping people who need a ride poor by raising the price of the good they depend on", or even "preventing the poor from working by making it uneconomical for them to get to work".
If you're going to argue in favor of breaking competition, you absolutely have to have a better argument than "it's good for the sellers." There's two sides to every economic transaction, and I see no evidence that cab-medallion-owners are drastically more worthy people than cab-riders.
In many of these cities, it is impossible to flag a cab at any price during peak hours. It would be far more efficient for the government to top up the earnings of low-earners than to manipulate the supply of cabs.
Lower fares is not the only consequence of this type of free market. In NYC we've seen a rise of intercity buses competing at cut-rate prices, and one such bus company recently and spectacularly failed every single safety inspection performed on their vehicles. They also have an accident rate several times that of their less price-sensitive consumers (Greyhound, Amtrak, etc).
Free markets often have substantial downsides, it's dishonest to pretend that regulation is strictly driven by parasitic behavior. There are also substantial upsides to commoditization - i.e., gains in efficiency when every consumer does not have to engage in complex analysis of the product on every sale. There is a loss of market confidence when you have to go through a mound of paperwork just to determine which intercity bus line is safe to ride.
When a market is over-regulated, such regulation often have legitimate and still-relevant roots. Those who cry for complete deregulation would be wise to figure them out first. Regulations may run amok, but they very often still sit on top of a legitimate need.