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[00:00:00]

In the world of people who collect things, Nathan Wilonsky is a rare bird. There are four of us in the world, so we're all good friends and we don't compete with each other. For whom? For people who collect taxes. Yes, I'm a serious basis. There are five, but we lost one. I was really sad, but we support his collection from his wife.

[00:00:19]

Nathan is a collector of taxi memorabilia, toys, games. If it's about taxis, Nathan has it. He's talking to me over FaceTime from his home on Long Island. And as we're chatting, I see a bit of his toy collection peeking out from behind him. It's so funny. I'm just looking over your shoulder and it's just like a million cars stacked up on shelves.

[00:00:40]

You know, I'm limited. I was given one room. This is the room. So I have the attic. I've got some cabinets in there and the dining room and I've got the garage, but that's it. So if you came to the house, you would know there was a collection here.

[00:00:53]

That's because Nathan's wife, Barbara, was like, no, I will not live in a hoarders house to be there. Nathan's collection of 90 200 taxe toys is extremely orderly. Like, I wish she would come to my house and organize all of my knickknacks. Can you take me around and show me a little what you have? Sure.

[00:01:11]

So I'm going to flip the phone.

[00:01:12]

P.S. I would have gone to see Nathan's collection in real life, but coronavirus over here by my desk with this, you know, H.O. things are those like little matchbox cars. Small of these are like micromachines, kind of bigger than micromachines, small.

[00:01:29]

These are what the Germans collect. These are mostly German because they don't have much space.

[00:01:33]

They're wind up taxis and rubber taxis and replica Volkswagen Beetle taxis are taxis made of glass and taxis made of porcelain and tricky taxis that's been around the table but won't fall off.

[00:01:45]

And then we we go along here. And if I'm going to fast say something up top or my favorite American ten and European ten, and then my other favorite are made in Japan toys. These Japanese ten are really neat.

[00:01:58]

But Nathans collection isn't just toys. He takes me into the attic where an equally huge assortment of taxe collectibles live, taxe cigar boxes and taxi ashtrays, taxi hats and taxi baby shoes. Two huge binders containing the sheet music to taxi songs.

[00:02:16]

Oh my God, it just keeps going.

[00:02:18]

Business cards, tokens, match books, lots of match books.

[00:02:21]

Then we get to the piece that inspired Nathan to start collecting taxi memorabilia 30 years ago. A taxi cookie jar that his mom bought him.

[00:02:31]

Got to be here somewhere, not down there. You see, this isn't. This is it. Oh, my God, that's an enormous cookie jar. That's the one that started me Nathans most other collections over the years.

[00:02:49]

But as a New Yorker, nothing stuck like carbs.

[00:02:52]

I like taxes. I get a tingle when I see one. But in the wake of coronavirus, there are more taxis inside Nathans home than there are on the road. The usually cab choked streets of Manhattan have been quieter. Rows of taxis sit idle on streets throughout the city for one of the first times in the history of yellow cabs. This iconic symbol of New York has been rendered practically useless. But the city's taxi industry had been flailing away before the virus hit.

[00:03:19]

And it's not just because Uber and Lyft rolled into town and stole all the fares. Because, you know, when President Trump's felonious former attorney, Michael Cohen, is involved in the taxi industry, its problems run away deeper than ridesharing. I'm Lauren O'Brien from American Public Media. This is spectacular failures, the show that always keeps the meter running for failure.

[00:03:46]

The way Dave Pollock tells it, he was born in a taxi, you know, it's funny, I was speaking with my mother about it about six months ago, and she says, oh, come on, we made it into the hospital.

[00:03:58]

And I said, well, that's not what that says. You know, I was they came out and in the front seat I was born. Then he took me inside. So I was at the hospital, but I wasn't born in the hospital. I was born in the cab.

[00:04:10]

Polich is a Bronx boy with a Bronx story. So it makes sense that a guy who bleeds Yankee blue and taxi yellow would have this kind of beginning. His grandfather emigrated from what is now Ukraine and became a yellow cab driver. His father also drove a taxi. And of course, Polich was going to do the same.

[00:04:27]

I drove a cab part time one I was going to college in the city. And as time went on, I started driving more and taking fewer classes. And ultimately I dropped out of college and drove a cab full time.

[00:04:43]

Pollack worked as a taxi driver in New York for about five years in the 70s. Back then, the city was libertine and lawless and alive.

[00:04:51]

I used to love driving late Friday into Saturday and then Saturday night into Sunday. You feel like you're the blood and pulse of New York City.

[00:05:03]

Pollack became well acquainted with the downtown party scene. Andy Warhol sat in the back of his cab on more than one occasion. One time, Paula got some passengers into the famed nightclub Studio 54 by dropping some names at the door. It was an electric time to drive a cab in the city.

[00:05:19]

Saturday night ends and all of a sudden everybody is home and it's 4:00 or 5:00 in the morning and it's starting to get light. And you're all alone on the streets of the city. There's something that you can't really describe. You have to live through it to understand. It was it was great.

[00:05:35]

After Pollack quit driving, he began working in the taxi insurance business. Then he moved on to work at a credit union for cab drivers. Later, he started a taxi newspaper, then a taxi radio show.

[00:05:47]

You never heard a radio show like this before. Following in the footsteps of his father and grandfather, Taxi, Dave drove a taxi in New York City for many years. In fact, he was born in the front seat of a yellow cab.

[00:06:00]

Join us for an hour of informative discussion with the only the Taxi Dave show is just one small slice of taxi esoterica. There are taxi periodicals and taxi reality shows and taxi joke books, which is where I got this gem.

[00:06:15]

I just got fired from my job as a taxi driver. Turns out people don't like when you go the extra mile for them.

[00:06:25]

In 1978, Danny DeVito starred in a hit TV show All about taxes. It was called Taxi. Like you, you're a cab driver.

[00:06:34]

What do you mean busting my chops here? Make a movie, a regular person. A solid number of Seinfeld scenes were filmed in the backseat of cabs, and they often ended like this, you'll never get out of my cab. There's always been an undeniable mystique about cabs.

[00:06:52]

They're more than just a mode of conveyance. Taxis are havens. They save us from the rain, from bad dates, from being late when the trains aren't running. Cab drivers are confessors and voyeurs. Sometimes they might even give you stock tips and they occupy a special place in our collective cultural psyche. Taxi. Dave was part of that. He's retired now and lives upstate. But in his early days, he was the embodiment of New York's Yellow Cab business and all the pride in nostalgia and gritty glamour that came with it.

[00:07:22]

At one point, he even owned a prized taxi medallion.

[00:07:25]

The taxi medallion was always, I guess the cliche is the gold standard of transportation in New York City.

[00:07:33]

In order to understand the collapse of the taxi business in New York, we have to first get real friendly with taxi medallions. Basically, before 1937, New York was jam packed with tens of thousands of unlicensed, unregulated and often unsafe cabs. Wildcat drivers with busted up cars were hustling passengers all over town. The city was like, yeah, we got to pump the brakes on this nonsense. So they created a medallion system. It is literally a piece of tin bolted to the hood of your cab.

[00:08:04]

And it is the license that allows you to own and operate a taxi cab.

[00:08:10]

That's Brian Rosenthal. He's an investigative reporter at The New York Times and he's written extensively about the taxi industry in New York City and won a little Pulitzer Prize for his work. Basically, the city said all the cabs on the street at this time are eligible for a medallion. The rest of you bums get out of here. And that essentially froze the number of cab licenses at around 17000. These medallions were the gold standard of transportation in New York. They let passengers know, hey, this driver answers to some legit authority and you're not going to get ripped off and the wheels aren't going to fly off the car while it's on the road.

[00:08:47]

Hopefully, they are originally issued by the city, but once they've been issued by the city, they can be bought and sold like any other asset. And so the price can fluctuate like any other asset.

[00:09:03]

In 1937, a taxi medallion cost just ten dollars. After World War Two, the price has climbed to five thousand dollars. Because there was a limited number in high demand, the value kept going up over time.

[00:09:16]

They steadily increased in price steadily but slowly, kind of with inflation as well as a little bit more than inflation. As people realized that you could really make money with these things, you know, they got up to fifty thousand and they got up to 75000. They got up to 100000 for years.

[00:09:33]

The value of the medallion tracked nicely with how much a driver made using the medallion. As the population grew and the city became more prosperous, the amount a cab could bring in increased, so the value of the medallion kept going up.

[00:09:47]

The people that own medallions were really focused on making money off, picking up favours off the street.

[00:09:54]

But all that changed in the 1990s. That's when a guy named Andrew Kerstein came on the scene. He came from a taxi family. His emigre grandfather drove a cab when he arrived in the US from Argentina and managed to scoop up hundreds of medallions. Over the years, his father carried on in the medallion, scooping up business. But as the law goes, Andrew Hammerstein wanted to do his own thing. No taxi biz for him. So we went to business school, got his MBA and worked as an investment banker at some big deal banks.

[00:10:25]

Eventually, though, Mercian found his way back to the family business. Instead of managing medallions, Mercian convinced his family to sell them off to finance a new lending business. He called the Enterprise Medallion Financial Corporation, and its slogan was In niches. There are riches.

[00:10:44]

A lot of these kind of second generation, third generation in the cab business types of people were thinking of ways to make more money.

[00:10:53]

So rather than just buy and sell medallions among fleet owners or individual owner drivers, Mercian figured you could treat the medallions as an alternative asset class, like vintage wine or foreign currency or precious metals. And you could sell those assets to passive investors who had zero interest in the taxi business but wanted to make some big returns.

[00:11:16]

He called them riskless assets. I mean, basically everyone saw it as easy money.

[00:11:23]

That's Gary Ross, a former policy analyst at the Taxi and Limousine Commission, which distributes the medallions. And here's Mercian himself talking to the Associated Press about those little moneymakers.

[00:11:34]

It's kind of like real estate when if you buy something, you own it. For life, and the reason why taxi medallions are such a valuable asset is if you bought one, you don't have to drive the cab just like real estate. You rent it out.

[00:11:47]

OK, I'm with you. So you're getting a return on your current investment by getting the rental income. Plus you're keeping all of the appreciation and there's only so many of them continue.

[00:11:59]

There's only been a thousand new medallions in the last 70 years. So the New York population has gone up tenfold in the last 70 years with the medallion population has gone up less than 10 percent.

[00:12:11]

All that meant that as the city got bigger and medallion numbers stayed flat, the value of the medallion kept creeping up because scarcity. Then in 1997, the city auctioned 400 new medallions. It was the first auction like this in 60 years, and medallions fetched around 200000 dollars apiece. And Christine told the trade streaming podcast that meant a tidy little profit for the city.

[00:12:36]

They're receiving a transfer fee of five percent every time a medallion is bought and sold. So it's a great income stream for the city also. And that's one of the reason that they protect the market so well regulated is because, again, there are a partner, they're getting five percent of the sale price.

[00:12:54]

Now, I don't know about you, but I'm picking up some very distinct cartel vibes. If the city stands to make money off of the sale of medallions, then the city has an interest in making sure the prices continue to climb in advance of the next medallion auction. In 2004, the city's Taxi and Limousine Commission ran ads all around town encouraging cab drivers to buy our own bulls.

[00:13:16]

And I'm in charge of my future. Hi, I'm Commissioner Matthew Doss of the New York City Taxi and Limousine Commission. For only the second time in city history, a limited number of new taxi medallions will be auctioned off directly to the public. A medallion gives you the right to own and operate your very own taxi and is often seen as a great investment. Visit us online at NYC Duncalf or dial three one one for more information on this once in a lifetime opportunity designed to again was the best decision I ever made.

[00:13:42]

And it wasn't really a once in a lifetime opportunity, but the line worked. Medallion prices skyrocketed, which was a great thing for investors and for anyone who already owned a medallion. When the city auctioned off even more new medallions later in 2004, bids topped 300000 dollars. Five years later, medallions pulled in more than half a million dollars. But why the dramatic spike? Well, part of the reason was that when Mercedes and others of his ilk got in the game, they marketed the hell out of the medallions, particularly to investors who were still true believers in the fiction of riskless assets that only ever appreciate.

[00:14:21]

Did they learn nothing from the housing crash.

[00:14:23]

They've gone up 15 percent per year for 70 years, exactly as you said, outperforming the Dow gold, Nasdaq real estate, you name it.

[00:14:31]

Oh, I'm almost sold. You've told me how it's just like real estate. Now tell me how it's not at all like real estate.

[00:14:38]

Unlike real estate, real estate, each cash people have to pay maintenance. People have to pay real estate taxes. These are little cash cows running around the city spitting out money.

[00:14:47]

I mean, tell that to an immigrant cab driver bringing home 40000 dollars a year and one of the most expensive cities in the world.

[00:14:55]

But anyway, investors weren't the only one trying to get their mitts on some medallions. Drivers who wanted to become their own bosses and have a little more control over their destiny were also being encouraged to buy medallions. But as investors kept driving medallion prices higher and higher, drivers kept needing bigger and bigger loans. And this doesn't make any sense. But those giant loans were becoming easier and easier for drivers to get. Part of the reason that happened, says Brian Rosenthal, is because the lines between the lenders and the brokers and the fleet owners, the entire money side of the business seemed to get real blurry.

[00:15:31]

Some savvy business people ended up doing all of those things at once. And so you'd have an insurance salesperson that was also the broker and the banker, the lawyer, the fleet and everything else. And, you know, it all just got kind of tied together.

[00:15:49]

So if I'm selling taxi insurance, but I'm also a taxi broker, I could hook you up with a medallion while I'm selling you insurance. Then I could connect you with my guy who was a lender. And he thanked me by sending insurance business my way and everyone's palms are greased. Call me vanilla, but that's a few too many people in bed together for my taste. Now, what does this sound like, Miraz? A balloon that just keeps getting bigger and bigger and bigger.

[00:16:15]

Is it reminding you of anything? How about the 2008 housing crisis? In financial terms, a house and a taxi medallion aren't that different. Both were reasonably safe and boring, appreciating assets that generally required a loan to purchase unless your moneybags investor. And as we know from the housing crash, not all loans are created. Equal loans can have a. Wildly different terms and conditions, depending on how much of a risk the borrower is and the riskier the borrower, the more exotic the loan deals can get.

[00:16:47]

There's a good reason the taxi bubble started to look a lot like the housing bubble.

[00:16:51]

Before it, we tracked how some of the people that were involved in the housing market bubble after that kind of got shut down. They they were looking to apply those practices elsewhere. And so they went into the taxi industry. You know, this is something that has happened over and over again. And with this type of an asset, there were people that thought that they could make money off of it, and so they did.

[00:17:17]

But the inflation of the medallions was actually a little worse than the subprime mortgage crisis. In one particular way, the government was actively rooting for it.

[00:17:26]

They were saying that this is a risk free investment, that you to invest. It's the opportunity of a lifetime. So, I mean, yeah, if you don't know anything about finances and not only is your boss and everybody in the industry telling you that it's a great idea, but the government itself is telling you it's a good idea, what are you going to think?

[00:17:43]

By 2013, medallions were worth an eye popping one point three million dollars. That valuation doesn't track with the income that cab drivers were bringing in, not even close. That one point three million dollar figure represents a 500 percent spike in value since the first city medallion auction in 1997. That's a really big bubble. But here's the thing about bubbles. They can't grow infinitely huge. At some point they will burst. We're going to take a quick break. When we come back, what happens when the laws of physics come to bear on a multibillion dollar industry?

[00:18:18]

Plus, what a ride share. Tech disruption and a global pandemic mean for one of the world's most iconic transportation systems.

[00:18:35]

When Miriam Rosen and her husband Elie moved to the U.S. from Israel in 1973, there weren't a ton of job opportunities, so they turned to their countrymen for help.

[00:18:45]

We found some Israelis that, you know, came here like us with the same idea. And they told us that probably the best way to do is to buy the medallion, which is an asset, and you will be able to drive a car.

[00:19:01]

Ellie had been a truck driver back in Tel Aviv, so driving a cab seemed like a logical extension of that. Plus, there's an immigrant.

[00:19:09]

There would be there is no requirement as far as like, you know, the education levels. And then basically you have to just drive and know the city and speak a little bit of English. And if you don't speak English, that would be OK, too.

[00:19:22]

So the couple pulled together their money and bought into a mini fleet, basically a little taxi corporation with two medallions. They share the medallions with another owner driver. It wasn't the dream of Myriam's life, but owning a cab did feel kind of special.

[00:19:35]

You're part of New York. You own something out of New York because the yellow taxi really represent New York.

[00:19:41]

Things were good for a long time. Miriam got a job in the city's diamond district and drove the cab. In the beginning, Ellie worked crazy long shifts, sometimes 14, 15 hours a day, seven days a week. But once he got his groove going, things fell into place. He'd hang out with other Israeli drivers at one of the city's airports waiting for fares. Or he'd swing by one of the few midtown hotels where he had some good connections with the concierge.

[00:20:05]

He drove his cab all over the city all day long. In a way, Ellie was living his American dream, and that's what cab driving had been about since the beginning, says Professor Ted Landsmark.

[00:20:17]

Driving a motor vehicle to transport individuals from one location to another is the kind of business that ought to be open to immigrants, new arrivals and long term residents of the city who may be diverse and aspiring to make some money in a way where they can build up some equity for themselves and their families.

[00:20:44]

Landsmark is the director of the Dukakis Center on Public Policy at Northeastern University. He grew up in Harlem in the 60s and most of his early taxi experience was with unlicensed cabs. Traditional yellow cabs at that time often didn't serve black or Hispanic neighborhoods. But as an expert in the urban environment and transportation policies, Landsmark sees cabs as a crucial step up for many immigrant families.

[00:21:08]

I think it's essential that as a city's demographics change, all of the new people in the city ought to have an opportunity to become part of the businesses that work within that city.

[00:21:23]

Over time, a number of those new arrivals were able to expand their medallion holdings. They would buy two, then three, then dozens, stockpiling medallions and thus wealth for future generations. This was how the taxi industry grew. And as it grew, it developed its own codes of conduct and factions and hierarchies.

[00:21:42]

And to a large extent, it has been dominated by a limited number of families or investors who've often passed along the business in an intergenerational way and only among certain people.

[00:21:58]

People like President Trump's former lawyer, Michael Cohen, who got into the taxi business in the 90s through his father in law, an immigrant from the former Soviet Union. Along with a partner, Cohen operated a fleet of more than 250 cabs. Later, Cohen got involved with Gene Friedman, New York's so-called taxi king, also a convicted tax evader. All this ended real well for Cohen, who is currently on house arrest for evading taxes on, amongst other things, his taxi medallions.

[00:22:29]

The 90s were a real turning point for medallions. It was when they started to be viewed not just as essential components of family businesses, but also as hot little moneymakers. The city set up and took notice. And that, Miriam Rosen says, is when things started to change.

[00:22:46]

The couple noticed more and more onerous regulations imposed on cab drivers at the time, Miriam remembers that they had to get their cab inspected at least three times a year and that cost money. And God forbid they find something wrong with your cab if they check the cab.

[00:23:01]

And if the seatbelt is not going to be state, you will be found. They remove the medallion from your thing or you won't be able to work until you fix it. And it will tell you in coming a week or 10 days. So that's so forget it. Just stupid regulation.

[00:23:15]

Now I'm all for safe taxis. Thank you very much. But for drivers, the increased regulations courtesy of the Giuliani administration seemed oppressive.

[00:23:24]

They will come up with and that's another thing, another scheme to get money out of them. And it was very hard to make a living.

[00:23:31]

Then in the early 2000s, Miriam started to notice another change. The value of the medallions was increasing by a lot. We knew it's a bubble. We knew that it's not legit. But we do know you can put your finger. I mean, eventually we found out what was happening, but we couldn't figure it out because it just did not make sense.

[00:23:52]

Miriam Aneli, who died in 2016, tried to unload their medallions when they saw the price continue to climb. They didn't want to get stuck holding medallions when the bubble eventually burst in 2011, TLC analyst Gary Roth got his first real glimpse of the medallion bubble as it floated on by.

[00:24:10]

He had been asked to look into whether leasing rates for taxis were too low. Basically, operations like Michael Cohen's leased medallions to drivers, kind of like a car rental. And much to the chagrin of many fleet owners, there was a limit to how much they could charge drivers per day, a rate that was set by the Taxi and Limousine Commission, or TLC. So medallion owners were hoping to extract some more money by punching up the lease rate.

[00:24:36]

I basically looked into the numbers and I saw that the current leasing amount was not nearly enough to pay for the medallion as it was. So all that would happen if they increased the value of the lease, then it would just push up the value of the medallion, which was already very high.

[00:24:52]

This was Roth's first indication that the industry was perched right atop the bubble. As the value of medallions went up, the medallion owners wanted to find a way to make more money off of their appreciating assets. And since cabs were bringing in the same amount of money they always had been, there weren't many avenues for increased income to me. Lauren Ober, casual observer. The lease price induces heart palpitations. At the time it was eight hundred dollars per week minimum for drivers who didn't own their own medallions.

[00:25:23]

That's at least thirty two hundred dollars monthly for the pleasure of renting a cab. And that doesn't even factor in the price of gas and maintenance and all the inspections that the city required of the taxis. Things weren't looking great for cab drivers, but they were about to get so much worse.

[00:25:40]

I rang the bell in 2000 and 11 and prices kept going up and up. I mean, it's similar. I said like Amazon stock. I mean, if you look around, I'm sure there are people ringing bells that Amazon stock is going to decline. You don't know who is right until until later this year, the roar sounded, the alarm about medallions was the same year that ride share giant Uber rolled into town. And man, that did not go over well with cabbies and medallion owners.

[00:26:08]

See, here's the thing about medallions. They were meant to be exclusive. If you wanted to pick up a passenger on the street, you needed a medallion. Remember, back in 1937, the whole point was to keep unlicensed taxis off the roads, but then ride sharing came along and it was 1937 all over again. Except with GPS and more comfortable cars, Uber and Lyft laid waste to the idea that medallions were exclusive and worth anything close to a million dollars.

[00:26:36]

In a blink ride, health services had tens of thousands of cars on the road that directly competed with cabs. Taxis have always had competition in the form of black cars, livery cabs, limos and of course, your uncle Donnie, who would sometimes agree to give you a ride downtown. But Uber and Lyft were different once Uber and Lyft come along. Then all bets are off and all the economics, whatever you knew or thought about the economics of the industry before that it was no longer applicable.

[00:27:07]

That's David Yassky. He was the chair of the TLC from 2010 to 2013.

[00:27:12]

There's just a lot less money coming into the fleets, the owner drivers, everybody.

[00:27:17]

But figuring out how the yellow cab industry in New York drove off a cliff is a little like asking a bunch of toddlers who colored on the wall and each of them saying he did it while pointing to a different kid. Batarfi Jaci is the co-founder of the New York Taxi Workers Alliance, a 21000 member union. She describes the cab crisis like this.

[00:27:38]

This is a play in many acts. And, you know, certainly Bollywood girl, you can have more than one villain.

[00:27:47]

What happened to the cab industry in New York is a real cluster, but let's see if we can't flush things out a bit. Cabman And prices rose steadily from the 30s to the 90s, and their value was largely based on how much money a cab brought in. There was a limited number of medallions and the medallions conferred special rights to pick up a street hail. Then in the 90s, a few things happened. The Giuliani administration found all kinds of inventive ways to nickel and dime drivers to fill the city's kitty.

[00:28:14]

Speculator's figured out taxi medallions could be sold to investors just like real estate. And the city auctioned off the first new medallions in 60 years. As the medallion as asset schemes grew more popular, the value of the medallion became artificially inflated.

[00:28:30]

The medallion went from being a tool of the trade to a pure financial asset. And so the value was no longer rooted in how much revenue could earn and therefore sustain in payments.

[00:28:46]

Medallions value now corresponded to whatever people were willing to pay for it. Still, though, if you were a driver and you wanted to buy a medallion, even at those outrageous prices, you could still hustle up the financing and make your payments. The taxi industry still had a monopoly of sorts, and you could still make good money from driving. But then Uber and Lyft came along and everything you ever knew about the cab industry went the way of the buggy whip.

[00:29:11]

Three years after rideshares arrival, the yellow cab business hit the biggest pothole it had ever seen.

[00:29:17]

All of a sudden, in late 2014, the prices start going down very, very quickly.

[00:29:25]

Just before this crash in 2014, cab drivers who didn't own medallions already were increasingly pushed to buy one at seven 800000 dollars per medallion, often by brokers who are also lenders AEOI and the loans these brokers were pushing don't even get me started somewhere.

[00:29:44]

Interest only, meaning the drivers would never even come close to chipping away at the principle. Some were balloon loans that would come due after three years, which would mean the drivers who let's be real were never going to pay off. Eight hundred thousand dollars in three years would have to refinance. The subprime mortgage market had come to the taxi lending business. The folks borrowing money for the medallion. We're not that different from the folks getting snared in subprime loans, working class or low income new Americans or people of color without a lot of resources.

[00:30:16]

An average taxi driver in New York makes around thirty forty thousand dollars a year and they were being persuaded to carry debt in the hundreds of thousands of dollars. Here's David Yassky, former TLC chair.

[00:30:27]

None of the ordinary stuff that applies to employees ever since the New Deal, minimum wage and maximum hour is over time. Good working conditions. You have safe working. There's none of those things apply in the taxi industry.

[00:30:43]

So if the taxi medallion crash is a play with maniacs, here they are. First, the inflation of taxi medallion skyrockets, then an overlay. Bridged, exploited workforce gets pushed into bad loans and finally, an industry disrupter in the form of Uber and Lyft arrives. Yeah, things aren't looking good.

[00:31:03]

The bubble burst as bubble is due and the banks realize that this asset was didn't make any sense. And so they stopped fighting loans and that led everything to kind of collapse.

[00:31:17]

In an instant, those medallions fell from their sky high million dollar value. Their worth became much more reflective of their value as a transportation option. And that value was falling fast thanks to the tens of thousands of demand. Uber and Lyft jamming up the streets. All those drivers who took out breath taking loans were suddenly underwater, just like so many homeowners in the mortgage crisis six years before, after the crash, all of New Yorkers cabbies were vulnerable, but none more so than the 3000 or so owner drivers, folks who own their own medallion and taxi and drove for a living.

[00:31:52]

They are all in danger of losing their medallion, which is their job, or being forced to file for bankruptcy, which means that not only with their credit in the future be affected, but for some of these families, it means that they could lose the house, which may be a second mortgage with the medallion.

[00:32:13]

Twenty eighteen saw a spate of taxi driver suicides. It's impossible to know for certain why each driver took his own life. But the eight deaths brought the story of financial ruin and the depth of driver despair to the public. The average owner driver was carrying 600000 dollars of debt from his medallion purchased, Taci says, and losing income every year. But just when you thought it couldn't get any worse, Coronavirus comes to town and we all know what happened then.

[00:32:42]

Nobody leaving their houses meant nobody needed a cab. And nobody needing a cab meant that thousands of taxis sat empty on the streets, their drivers at home collecting unemployment if they were lucky. Hari Singh is one of those drivers. For the past 20 years, he's leased the medallion from a fellow immigrant who drove four years until he retired. Singh worked the night shift six or seven nights a week. It was hard work, but at least it was work.

[00:33:09]

This is my first time in my life. I go to work. Even I have a hundred and two temperature, you know. Well, I go to work because I like to work. That's my job. But since last three months of World War I stay home because I take precautions for my health.

[00:33:32]

Staying home means waking up at three p.m. in the same one bedroom apartment in Queens. He's lived for 35 years. He keeps the same hours as when he was driving so he can talk to his wife and two kids. Many time zones away in India, he's getting by with unemployment, but barely.

[00:33:49]

My life is struggling life. If I think of all these things, you know, I go to depression. So I just think positive means, you know, I just think about the future. Forget about the past.

[00:34:05]

Before covid curbed New York's cabs, Singh noticed that his daily wages were dropping. They've been decreasing ever since Uber arrived. Pre pandemic, Singh was making less than ten dollars an hour after the cost of leasing and maintenance and all that. Meanwhile, minimum wage in New York City is fifteen dollars an hour.

[00:34:24]

If I don't go to work, I don't make money to survive. And the whole family better life. You know what I'm saying is lucky in a way.

[00:34:38]

He's not up to his eyeballs in debt, and he wasn't bamboozled by unscrupulous lenders who preyed on new arrivals. And unlike Miriam Rosen, he's not yoked to medallions that are barely worth the tin they're printed on. But this isn't what the American dream was supposed to look like. A 70 year old cab driver working the night shift for less than minimum wage, living in a one bedroom apartment, oceans away from his family. New York's once mighty taxi industry has endured dramatic shocks in the past decade.

[00:35:06]

Bhairavi Jassi thinks that the city sat idly by and allowed it all to happen.

[00:35:10]

I think they treated this industry like a used garage. You know, they used it to clean up the financial mess in the aftermath of 9/11 and then they threw it out into the dustbin. Right. But like what they didn't clean up was like all the blood in the sweat of the drivers that they left behind. And that's what we're still dealing with.

[00:35:33]

It's anyone's guess what happens with New York's yellow cab industry moving forward. Decides group is working on a debt forgiveness campaign for owner drivers who are underwater with their medallion loans. And they're trying to address drivers basic needs right now while the city's taxi industry is sidelined due to the pandemic. But there's still the Uber and Lyft problem, one that won't be going away anytime soon. And later down the road, the arrival of autonomous vehicles. When that happens and it will, what will become of this most quintessential part of the Manhattan cityscape?

[00:36:07]

Yellow taxis are as much a symbol of America's biggest city as the Empire State Building or the lights of Times Square.

[00:36:14]

But they could soon be just that, a symbol, a replica, their only home on a toy collector's shelf, spectacular failures as a production of American Public Media. It's written and hosted by me lead foot Lauren Ober. Pedestrian Whitney Jones is the show's producer. Our editor is Carpoolers Phyllis Fletcher, Futura Uber Driver. David John is our system producer. Our theme music is by the delightful David Schulman, other original music. The season comes from Jen Champion and Michael Cormier.

[00:36:46]

Christina Lopez is our audience engagement editor and Lauren Dezi is our executive producer concept by Tracy Mumford. The general manager of APM Studios is Lily Kim. Super special thanks to all the current and former cab drivers and medallion owners who share their taxi stories with us, especially the one and only taxi. Dave, for your radio show, what was your Sinon or your Sign-off? How did you how did you do it?

[00:37:11]

I used to say, got to go now. Taxi.

[00:37:18]

Oh, my God. That's such a good whistle. That's so impressive.

[00:37:21]

Hey, if you're a New Yorker, you got to whistle like that.