Las Vegas Review-JournalDonrey Newspapers
Review-Journal Online Tuesday, March 25, 1997

Too many taxicabs?

Protection racket holds out competitors.

     Has there ever been a clearer demonstration of the way regulatory agencies, foisted on the public as a means to "protect" consumers, in fact "protect" only the right of the regulated firms to be free of competition which might force down consumer prices?
      Drive up and down the Strip, or in and out of McCarran International Airport, and you might agree at first glance that Las Vegas has plenty of taxicabs. Those are, after all, the most lucrative routes to which cabbies can swarm.
      But try to find -- or even call for -- a cab in almost any other part of the valley, and it can be another story. Where did we get the idea that some government agency -- in this case, the state Taxicab Authority -- should determine for us the "proper" number of anything available in the private sector, anyway?
      Are there "too many" pizza places in this town? Quite possibly, if by "too many" we mean that a fair number of stores seem to go out of business each year. Would it thus be a good idea to establish a Nevada Pizza Authority, scientifically determining the "ideal" number of pizza restaurants to be allowed in each square mile?
      Once one neighborhood pizza place had paid several thousand dollars for its pizza license under such a system, of course, it could be expected to show up and testify against the "economic chaos" which might result if any second pizza parlor were ever permitted to set up shop in its "protected market."
      Such a scheme sounds absurd on its face. Yet it's accepted without question when the commodity in question is taxicabs.
      Richard Flaven ought to know the ins and outs of the business -- and where the market would support another entrepreneur. Mr. Flaven, 39, is a Taxicab Authority compliance officer at McCarran. His father, Robert Flaven, is the Taxicab Authority's chief investigator.
      Mr. Flaven applied last fall for the required license to operate two cabs, as reported by Review-Journal columnist John L. Smith on March 21. But the Taxicab Authority hasn't licensed a new cab company in Southern Nevada in a quarter of a century. And the threat of "market chaos," with tumbling prices and widespread bankruptcies, represented by just two new jalopies cruising the southern extremities of the valley, was simply too hideous to consider.
      So Mr. Flaven, after shelling out $50,000 just to apply for the license, was informed last November that his application had been rejected. He reapplied in January, and will have his case heard again in May.
      Mr. Flaven doesn't sound too upset. "It's a long process," he told Mr. Smith last week. "But it means everything to me. To have an opportunity to serve the public and to build a stronger company than what I have; that's everything."
      Mr. Flaven may have good reason to modulate his comments. Should he gain his license, then the Taxicab Authority would of course stand as a bulwark, defending him from unwanted upstart competitors.
      Central government planning based on "scientific evaluation of the public's economic needs" is collapsing around the world, sometimes in flames but more often in rust and rubble, in whimpers of disgust and embarrassment. Isn't anyone else embarrassed by what is arguably America's freest state -- Nevada -- insisting on the perpetuation of its own Central State Commissariat of Taxicab Planning?


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