Freedom Friday – Institute for Justice Seeks to Expand Economic Freedom for San Diego Taxi Drivers

One of our favorite organizations is the Institute for Justice (IJ), a nonprofit organization with the mission of defending private property, economic liberty, free speech, and school choice. As their site notes, “simply put, we seek a rule of law under which individuals can control their destinies as free and responsible members of society.”  We couldn’t agree more!

We love reading up on some of the cases that IJ takes under its wing. We’re been hearing a lot recently about the controversies about taxi companies, including innovative new companies like Lyft and Uber, which are trying to break through the behemoth monopoly of the traditional taxicab industry, which hurts everyone but the privileged and well-connected few.

We recently read about a case for taxi freedom in San Diego. The Institute for Justice defended two drivers who wanted to have the right to own their own license and be allowed to drive a taxi to make money. The case follows Adbi Abdisalan and Abdullahi Hassan, both US citizens and longtime cab drivers who came to the US as refugees from Somalia’s civil war several decades ago. All they wanted was to have a shot at the American Dream—to work and prosper for oneself. But the City of San Diego created a virtual cartel in the taxicab industry servicing the city that was nearly impossible to fight.

San Diego’s process for taxi permits was outdated and monopolistic. The city created an artificial scarcity of taxis by capping permits for just 993 cabs. (The city has 1.3 million people and is growing). Permits cost $120,000 and were owned by 499 individuals, most of whom didn’t even drive a taxi. Instead, they leased out their permits for a weekly fee of $300 to $800. Under the leadership of IJ’s legislative counsel, Lee McGrath, San Diego’s city council lifted the permit cap, now allowing drivers who meet basic requirements to acquire a permit for about $3,000.

Of course, the cab companies of San Diego aren’t going down without a fight. They have engaged in a lawsuit demanding that the city—well, stop allowing entrepreneurs to have the economic freedom to start their own companies, as Abdisalan and Hassan plan to do. Nothing like an artificially constructed monopoly to increase prices and decrease quality of service, right?

IJ is still on the case.

It’s perplexing to see how governments of all levels use their “power” to create false monopolies and shortages that increase price, decrease quality, and create a nice security bubble for a small special interest—who will be more than happy to help with campaign cash when needed. With legislation long, boring and complicated, it’s difficult for the average working American to keep up with it all—but we believe the key to restoring economic and personal freedom in this country is for the populace to stay informed and demand accountability from their local, state, and federal governments.

We often hear people lamenting about the “death of the American Dream” and how it is nearly impossible for people to succeed anymore. We agree that the American Dream has become more difficult to attain. It seems that legislation is generally created by lobbyists with special interests in mind. Many laws and regulations make it nearly impossible for the “Little Guy” to succeed, instead pushing for the success of larger corporations with the resources to lobby, stand up for, or follow these heavy-handed regulations.

So in the face of all that news and the headwinds entrepreneurs face on a daily basis to pursue their happiness, their dreams, and their businesses, we love to share stories of people who take a stand and fight for individual and economic freedom.