Traveling Back in the Taxicab Time Machine to Boston and 2013: An Explanation as to Why and How the American Taxicab Industry Succumbed to Uber and Lyft
Pardon the delay of over 13 years concerning the story of Boston Cab and owner Edward Tutunjian's decades of illegal and dishonest operations, a many faceted tale I was aware of when the news broke but since I wasn't a Boston Globe subscriber I was never able to access the reports and articles associated with this sorry narrative. Now due to a cheap one dollar subscription I have been able to go back and research much of what happened. In addition to reading this, I encourage everyone to watch the 8 minute plus long YouTube video, "Driven to the Edge: A Globe Spotlight Team Investigation." Not only do you get the gist of the story but it also shows taxi reality as it really is minus embellishment. I've watched it an number of times, and will again. Some of the driver's comments make me smile. Sadly, that is.
I know this story! In various ways I've lived it though not quite to the extreme experienced by the drivers in the video. I sent the video to my old Seattle taxi buddy Bill, and Bill responded by providing many examples of commonplace widespread corruption similar to what the Boston Cab drivers were complaining about. He too was sometimes charged for the keys to his cab. That isn't nice. By the time I started driving, in 1987, Seattle taxi had become less feral, more civilized, a word I rarely associate with taxi. Nuts. Deranged. Crazy. Yes. But civil, no.
Why I find the Boston Cab story relevant today is that it helps explain how an industry weakened by asshole owners and corrupt taxi associations were no match for Uber and Lyft and their politically powerful backers. Yes, taxi barons like Tutunjian had one interest only, and that was making money. Though ultimately he was jailed and fined, he truly escaped real accountability for all the suffering he caused, his punishment amounting to a slap upon the wrist. As you read on, you will understand.
The background to all this is that for years the Boston, Massachusetts taxi industry of 1,825 medallion-licensed cabs and over 6,200 cabbies essentially remained unregulated, allowing owners like Tutunjian to consolidate many medallions, in his case 372, creating his own taxi fiefdom, making him sole ruler and decision maker for hundreds of mostly immigrant cabbies. His was a cruel hand.
The agency allowing the situation to fester was the Hackney Carriage Unit, a division of the Boston Police Department, and back in 2013, it was run by a Director of Licensing named Mark A. Cohen. You can see his mug in the video. You can guess my opinion of the "gentleman." I know that face, having seen too many like it in Seattle's cab world, almost as if there was a factory somewhere manufacturing this line of sorry characters.
Though what I have read so far doesn't say it, it seems very clear that Mister Cohen might have been in the "back pocket" of owners like Tutunjian. In 2013 Tutunjian was worth 250 millions dollars, owning many properties and, if you can believe it, vineyards in Chile. Pretty good work for a Jordanian emigrant who started out driving cab himself. I am sure he might have been tempted to create a little favorable influence, so to speak "greasing" the taxi wheels.
Helping in the Boston Globe's investigation was the reporter Robert Hohler, a once Boston cabbie during his college days, and now driving cab undercover. Unfortunately for him, his new tenure in the cab lasted a mere eight shifts, as he and two passengers were injured when a motorist ran a red light, demolishing his cab. Even though his return beneath the toplight was brief, it was long enough to witness various violations at Boston Cab regarding the drivers.
If you wanted to drive a shift, you had to pay the guy issuing the keys a bribe of $5-20.00. No bribe, no cab that shift. Another scam was charging driver's extra for gasoline even though the returned cab had a full tank. The most egregious violation Hohler experienced was the end of shift depositing of your taxi lease payment contained in a zippered pouch pushed through a pay slot in a wall. He heard many drivers complaining that money was stolen, then later forced to pay once again, their pleas of innocence ignored. Though it was required by the City of Boston to provide a receipt, none were ever issued. As one driver says in the video, "If you asked for a receipt, you would not get a cab tomorrow." Essentially, the cabbies were under Boston Cab's "thumb," and if you complained, no cab for you. Who says versions of modern day slavery doesn't exist?
Another issue that got the Boston Globe's attention is that Boston's cabs were allowed to carry minimum insurance coverage, the investigation providing many examples of accident victims receiving little benefit and relief once injured. While all this was bad, what finally nabbed Tutanjian in 2016 wasn't all his illegal behavior but tax evasion, somehow finagling payroll taxes into his own pocket.
Tutunjian, the "Taxi King" as the media called him, was sentenced to 18 months in a Federal halfway house, plus two months probation. In addition, he was fined 2.3 million dollars. But don't shed a tear for the fellow because, in 2017, he sold his entire operation plus some valuable associated property for $145,000,00. That right, one hundred-forty-five million dollars.
As for a final conclusion to this tale, I don't know it, other than Tutunjian remains a very rich man, his fortune made off the blood, sweat and toil of hard working cabbies. What Boston Cab looks like today I also have no idea. As everyone in Seattle knows, the year 2014 and the legal validating of Uber and Lyft changed our industry forever. I can only guess the same was true in Boston.
The moral here is that a poor combination of greedy owners and dysfunctional regulatory oversight opened the Uber and Lyft floodgates in Boston and elsewhere. Once the dam burst, most cites were inundated by the TNCs. While Seattle never had someone as awful as Tutunjian, we did have our more diluted versions, though our devils look like angels when compared to the evil Tutunjian.
I can say to this moment I remain on good terms with our mostly retired disreputable former owners. While their primary objective was making money, at least BYG (Seattle Yellow Cab) ran a pretty good operation, keeping the cars maintained while keeping our lease payments (the nut) down to a reasonable amount. And we always got receipts. But I will always see that "fill-in-the-blank" GM Dogwilla walking down the hallway like a giant bowling ball, knocking us out of place like so many bowling pins. Did he even notice?
Were all the driver's happy? No but if you were savvy and worked hard, you made a good living. Yes, we did make some of the big medallion owners millionaires but personally, I didn't care. Everyone made their choices. I made mine, a driver toiling beneath the toplight in the early morning light and dead of night! That's right!
Waymo likes Vegetables?
Recently a wayward Waymo in Denver drove into a Farmer's Market while vendors were setting up their stalls in the early morning hours. As usual, Waymo was full of excuses. What if a Waymo drives into a meat market, what are we going to hear from them? Baloney!
In CA, Someone is Filing Suit against Cab Companies picking up Uber Fares
Some might know that some cab associations are serving Uber overflow. A guy from New York State accused the cabbies and Uber of price-fixing. Right now they are arguing over court venue. But cabbies, don't you know Uber is poison? Watch who you rub elbows with.
Red Tesla Back After Arrest
A few nights back, excited friends called to tell me they saw the driver arrested and car towed away. He was arrested for driving down the wrong way down a street, suspected of driving drunk. But a mere three days later he was out of jail and back at it. What is it going to take to stop this guy?
A Very Short History of Taxicab Regulation
Consider this a Post Script to the Boston Cab tale, because what happened there, and the exploitation of the drivers directly points to a poor regulatory system and environment where oversight of ownership and association was notably absent. If anyone wondered why the Boston Police Department were the local regulators, all we have to do is to fly ourselves across and know that the vaunted London Black Cab industry was regulated, from 1850-2000, by London's Metropolitan Police. It only took them 1 1/2 centuries to transfer power to something called Transport for London (TfL).
In Seattle, regulatory oversight has been given to the Consumer Protection Division (CPD) of the Seattle Finance Administrative Services (FAS). I don't know what is happening in London but in Seattle, not one of the nice guys occupying those chairs have ever driven a cab. As I have repeated in these pages ad nauseam, if taxicab veterans had been employed at FAS in 2014, the response to Uber and Lyft would have been very different. But when your duties only include cabs as a part of your larger responsibilities, how surprising is it that cabs fell to the wayside?
If you think my premise is wrong, think about what happened in NYC when the City of New York began selling taxi medallions for up to one million dollars. Anyone with any kind of taxi industry knowledge knows instantly that was pure fantasy.
When I was in NYC in 2010 and visited a taxi brokers office, they offered me a medallion for $725,000 or two at the "bargain" price of $675,000 each. Outrageous but it all boiled down to one simple fact: no one for a moment cared about the impact, asking a cab driver to pay off that kind of mortgage. Even the best of us high-rollers would have an impossible time paying how much per month for the cab?
One example of how crazy all this was, if someone made payments of $20,000 per year on a $725,000 medallion, not including interest, it would take over 36 years to pay it off. What about a medallion costing one million dollars? 50 years.
Another way to calculate all this is to consider how many working hours driving a cab, grossing $30,00 an hour, would it take to earn that $20,000? A week has 168 hours. Multiply it by 4 weeks and you come up with 672 hours. All I can say is, drive a 12-hour shift and tell me how you feel after it. That's the entire story, Mister Pain and No Glory!
Summing up the obvious, it is clear that across the over one-hundred year plus history of American cab, our industry has been poorly regulated. And with the advent of Waymo, regulators are preparing for final our demise, digging the grave to shove us all in. Don't believe that? Well, Mister and Mrs and Ms Ostrich, think again!
Some Taxi FUN! Facts
Both innovations came to the taxi world from Germany. In 1891 Friedrich Wilhelm Gustav Bruhn invented the first taximeter. And what were they installed on? Horse-driven taxi carriages.
But changes were coming. In June 1897, in Stuttgart, Germany, you could catch a lift on a Daimler Victoria, the world's first motorized-powered, taximeter generated cab. I was in Stuttgart in June 1991. I didn't take a cab but found myself eating delicious German sausages at the train station's restaurant, washed down with one of the best glasses of beer I have had the pleasure of quaffing, a pilsner with a foamy head like meringue. The only German taxicabs I've taken have been in Duesseldorf in April 1982, my first excursion to Europe.
