The Angel seems to be accusing me of not addressing some of the points he's raised. Leaving aside the amount of points of mine that he's ignored in the past, perhaps he could re-iterate the unaddressed points on here, and this thread can act as an aid-memoire, since many of the points he is alluding to have been replied to umpteen times in the past, but he seems to persist in ignoring this and raising the point again.
For example, he recently said:
That has to be the biggest load of bullchit yet, TDO is intent on destroying plate premiums, how then can he say he feels sorry for the bloke who's bought their plate.
Yet in response to a similar point that he made less that a WEEK ago I said:
As I've said before, my own preference is to announce de-limitation at a future date, and this would give plate holders a chance to recoup their investment, even if they've been foolhardy in taking a gamble.
We suggested this in an article which is still on the frontpage (http://www.taxi-driver.co.uk/money.htm), and I put the same suggestion to the OFT and DfT in the personal submissions I made.
I can't help it if they ignore them, but your implictation of indifference to plate holders cannot be aimed at me personally.
It seems that Angel didn't reply to that post, and now he raises it again!!
Note that the article linked to above was written in response to the OFT's suggestion that plate holders were effectively taking a risk when buying a plate, and is one of the few articles permanently featured on our frontpage.
Perhaps Angel could point us towards any similar piece that defends plate holders in this way, but I think he'll find that this is the only piece of its type in the UK, and indeed perhaps the world. Note that even the Trans Comm said that premiums were not relevant to the decision of whether to de-limit or not, so to that extent the piece is more pro-plate holders than the Trans Comm was!!
Note also that the Angel was also recently telling us how quickly the purchase of a plate would pay for itself, and he also recently said:
For [edited by admin] sake man the majority of owner drivers didn't buy their plates as an investment, they bought them for the right to work the plate. Its just that doesn't suit your argument either does it, people actually working for something, burke
This seems a rather bizarre view from someone who seems so worried about someone who has paid a premium for a plate.
By the way, have a look at the article below from the Irish Times about five years ago before de-limitation in Dublin. Now if I'd said anything similar to that then the accusation of Angels in bold near the top of this post might have been reasonable, but I think his stance is unfair on TDO.
The Government's taxi proposals have recognised economic reality, but do not go far enough. Deregulation remains the answer to Dublin's taxi crisis, argues Sean Barrett.
The announcement of an increase in Dublin taxi licences by the Minister of State for the Environment, Mr Bobby Molloy, is a welcome recognition of economic reality. Governments should not ban new entrants to any field of economic activity.
Competition is the life blood of trade. Telecom deregulation has already saved the customer over £450 million a year, according to Eircom estimates. Access transport deregulation has raised the number travelling by air between Ireland and Britain from a stagnating 1.9 million in the early 1980s to more than 8 million today.
From the deregulated telecom and airline sectors two huge new industries have emerged in information technology and the fastest growing tourism in the OECD. Failure to deregulate a sector reduces the competitiveness of the wider national economy. Irish deregulations have been a major contributor to the Celtic Tiger in the authoritative UCD study of our recent growth by Mr Frank Barry.
No sector is ever willingly deregulated. Noise from taxi operators is therefore par for the course. Such noise started the present problem in the mid-1970s when the late Jimmy Tully was "persuaded" by a blockade of taxis on Butt Bridge not to issue new licences. Giving in to the pressures exercised by the taxi operators over a number of years caused the value of taxi licences to rise steadily from £3,500 in 1980 to a reported £70,000 today and more than £80,000 at peak.
The more restrictive the regulatory regime, the greater the value of the licence. It reflected the ability of the licence-holders to earn supernormal profits by charging above the putative deregulated market price. The more rapidly the licence price rose, the more people were persuaded to invest in this apparently easy way to make money.
The underlying economic reality was, however, that a taxi licence is a worthless piece of paper. It acquired a scarcity value only because the Government stopped issuing them. Nor is there any economic case for reimbursement of those who bought licences at the top of the market.
These people bought an expensive piece of paper in a bet that the Government would never have the courage to introduce a rational system in economic terms. They are now losing that bet and will lose it completely when the Government deregulates fully.
The Government owes them nothing. We don't pay out on losing national lottery tickets. Nor do bookies pay out on the also-rans in racing. The latter point has interest because bookmakers are reputed to have bought up a number of taxi licences. The issue of extra licences to existing licence-holders is an attempt to sweeten the pill but it makes little economic sense. The value of the licence reflects their uncompetitive behaviour of the past three decades, for which the customer has paid in high fares and poor service.
It is not a good idea that the Government should charge for the issue of licences. This creates the impression that the Government "owes" something to the licence-holder.
The pieces of paper called licences should be freely available. The sector needs both new entrants and more efficient incumbents. If the Government weakens its resolve to deregulate the sector totally, the scarcity value of a taxi licence will begin to rise again and the whole sorry saga of the past three decades will repeat itself.
The Government must, therefore, name a deregulation day when there will be no more barriers to entry and the market will determine the supply as well as the demand for taxis. There is obviously huge excess demand at the moment, given the queues throughout the day at the airport, railway terminals and city centre ranks.
All of the remarks here apply also to the bus sector. Seventy bus companies in Dublin and hundreds nationwide were legislated out of existence in the early 1930s by laws which would not satisfy the criteria of today's competition policy. It must be reversed.
Regulations against the creche sector in 1996 have had a similar cost-increasing impact and should be repealed to allow new entrants to the sector, thereby reducing costs. When Governments intervene to restrict new entrants to a sector, they invariably make a mess of it.
Mr Molloy must press on to full deregulation and not be deterred by threats from licence-holders as all ministers since Mr Tully have been. In the week in which Northern Ireland changed utterly, the Minister's Northern counterparts might like to tell him how the taxi businesses in Derry and north and west Belfast were deregulated. They now carry more passengers than the entire CIÉ rail system, with fares at, or below, the competing bus fares. They do so without subsidy.
To paraphrase a saying from another sector, there are three solutions to the Dublin taxi problem: deregulate, deregulate, deregulate.
Taxis, buses and creches illustrate why the Government should not meddle in vital sectors of the economy.
Sean Barrett lectures in economics at TCD
Login
Register
FAQ
