[jfager]

I specifically said "lower-middle-class jobs", and you're pretending I just said "jobs". Of course I meant that you were replacing fewer higher paying jobs with more lower paying ones.

I see nothing in your previous numbers showing how you do or don't keep the benefit to the consumer after throwing in a congestion tax, which is what I said we needed to do the math for.

Fun fact: there are about 250 million cars in the US, and about 250 thousand taxis. But I'm sure all congestion problems are caused by the taxis - thank god for limited numbers of medallions.

How many of those 250m cars are in NYC, and how many of those 250k taxis are? And at what point did I suggest that all congestion problems were caused by taxis? I even explicitly said I would support a congestion tax for other kinds of traffic as an orthogonal solution.

[yummyfajitas]

There are about 13,000 yellow cabs in all of NYC. The GWB and Lincoln tunnels have traffic of 320,000 and 120,000 vehicles (respectively). I'm too lazy to look up the number of people driving from non-NJ locales.

Also, I didn't realize that the 37'th percentile of income (36'th percentile in NY [1]) did not count as lower middle class (or just plain middle class). My mistake.

If the congestion tax costs less than $24,000/year/cab, consumers still pay less for a taxi.

[1] http://www.city-data.com/income/income-New-York-New-York.htm...

[jfager]

There are about 13,000 yellow cabs in all of NYC.

Which is the number set by the medallion system. My original point in this line of argument was that one of the main reasons cabs don't contribute to congestion in the city is because the number of cabs allowed in is capped. You're the one who wants to make that number bigger.

Also, I didn't realize that the 37'th percentile of income (36'th percentile in NY [1]) did not count as lower middle class

The labels are flexible depending on who's drawing the boundaries, I'm sure. The point is that I wasn't contradicting myself when I said your plan would both cut a certain class of jobs and increase traffic, I was simply saying that you're replacing fewer higher-paying jobs with more lower-paying ones. Where we disagree is that I think in this case that's equivalent to giving rich people a break and forcing more of the city's service workers to live further away, and I assume you don't.

If the congestion tax costs less than $24,000/year/cab, consumers still pay less for a taxi.

You're taking the savings from the medallion and labor costs that you posited above and assuming they'd be passed directly to the consumer, but that's overly simplistic. More competition means marketing costs go up, which drives the fares back up a bit. The congestion tax is presumably convincing fewer people to drive to work, which increases the demand for cabs, which drives the fares back up a bit more.

The point was not "you are wrong about consumer prices going down", it was "you have to start modeling the problem more carefully to have a meaningful conversation about it". You're probably right, consumers would save money, but again, given who the consumers are (oversimplifying: rich people), I don't necessarily see that as a good thing when it comes at the cost of cabbie pay.

[yummyfajitas]

My original point in this line of argument was that one of the main reasons cabs don't contribute to congestion in the city is because the number of cabs allowed in is capped.

Even if the number of cabs increases by 5x (i.e., customers are underserved by a factor of 5x), it will still be a small number.

As for the distributional benefits, yes. I'm willing to harm the wages of a middle class cabbie if it helps a poor unemployed person. I'm kinda progressive that way.

You're taking the savings from the medallion and labor costs that you posited above and assuming they'd be passed directly to the consumer, but that's overly simplistic.

I don't think so. Consumers pay the average taxi $90,000/year. I'm proposing a change in which consumers would only pay that taxi $66,000/year.

By the way, I think we should reverse your argument. You seem to favor creating artificial shortages in low skill fields to drive up wages. Since this is presumably good policy, perhaps we should expand it. How about waiter licenses for high end restaurants (which primarily serve the rich)?

(I ask about expanding this policy to other sectors because I think status quo bias is the main reason you support the status quo.)

[jfager]

How about waiter licenses for high end restaurants (which primarily serve the rich)?

High-end waitservice is hardly a low-skill field. Good waiters are well compensated, and restaurants compete for them almost like technology companies compete for programmers. And restaurants themselves are completely different businesses than taxis. Each additional taxi added to the city is more or less identical to the taxis that were there before, whereas restaurants are highly differentiated from each other. You can't predict the marginal payout of an additional restaurant.

But with that said, restaurants are regulated through zoning and health ordinances. You can't just start a restaurant out of your apartment or set up a table wherever you please to start serving people.

[yummyfajitas]

You are ducking the question by picking holes in my specific example (which might have been poorly chosen), so I'll phrase it in the abstract.

Consider any low skill job which serves rich customers. Under what conditions should we pass a law restricting supply, making an unlucky subset of those workers unemployed but raising wages for the remainder? All commodity services (including, but not limited to landscaping, taxis and maid service)?

Should we only do it in cases where we already do it? (I.e., should we simply maintain the status quo?)