Chicago’s Green Shakedown

Some weeks ago, I blogged on the taxi company that was being punished by the city for using rebuilt or salvaged vehicles.  The suit was settled for $1 million and the promise by the taxi company to convert to hybrid or alternative-fuel vehicles at considerable cost.  Daley was seeking $17 million.

As I reported then, no more accidents were associated with the cabs in question, and I still have no knowledge of such.  Cabs in Chicago are inspected semi-annually, so one wonders why no inspectors noticed the difference.  Well, it turns out that they did–on one cab.  This prompted a closer look and the discovery of a couple hundred “rebuilt” cabs, outlawed in 2005 even though citizens may legally drive them.

Had the cabs been failing emissions standards, would they not have been caught?  After all, they were inspected twice a year.  If there were more wrecks involving those cabs, would it not have prompted the city to take action?  In other words, it sounds like the cabs were operating just fine.  In fact, I would argue that they were an example of “waste not, want not.”  Why ban a perfectly good cab?

Chicago and any other city that regulates cabs does so mostly for its own gain.  By enforcing a government monopoly, the city can charge insane prices for licenses and permits, harass taxi owners, and line its pockets.  No shakedown is too obvious if something “green” is promised.  I doubt Chicagoans are any better off, but you can be sure Chicago city government is.

About Terry Noel

I am an Associate Professor of Management and Quantitative Methods at Illinois State University. My specialty is entrepreneurship.
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