Thread by @brianmrosenthal

NEW: Over the past year, a spate of suicides has revealed a financial crisis in New York's cab industry. Officials have blamed Uber, but much of the crisis can be traced to a handful of taxi tycoons. Here’s the real story, based on 10 months of reporting: nytimes.com/2019/05/19/nyr…

From 2002 to 2014, the price of the permit that lets a driver own a cab (a “medallion”) rose from $200K to $1M

It wasn’t by accident

Some of NY's biggest taxi leaders artificially inflated the price, and made millions by issuing reckless loans to buyers

nytimes.com/2019/05/19/nyr…

4,000 people bought medallions at inflated prices. Many were low-income drivers who had to sign huge loans with one-sided terms

Some signed interest-only loans that made them pay hefty fees, forfeit rights and give up most of their income -- indefinitely

nytimes.com/2019/05/19/nyr…

Next time you get in a NYC taxi, think about this graphic

If your driver owns the cab, they can make $10,000 in revenue a month

They likely get to take home less than $1,500 of that

And for that privilege, they probably owe their bank at least $500,000

nytimes.com/2019/05/19/nyr…

The taxi industry’s reckless practices, documented today in the @NYTimes, generated hundreds of millions for a handful of fleet owners, bankers, brokers & investors (including Michael Cohen)

One banker got Nicki Minaj to perform at his son’s bar mitzvah

nytimes.com/2019/05/19/nyr…

While taxi industry leaders got rich, their methods stripped immigrant families of life savings, crushed drivers under massive debt and created a bubble that eventually burst

950 cabbies have filed for bankruptcy. Thousands more are struggling to survive

nytimes.com/2019/05/19/nyr…

If you think our story on the taxi medallion market sounds familiar, you’re not alone: We found the bubble was similar in many ways to the housing market collapse. Some banks even sold off their most risky medallion loans, just like in the housing bubble

nytimes.com/2019/05/19/nyr…

As for Uber: It may have hastened the bursting of the taxi bubble, but it didn't cause it

The average revenue per cab is only down by ~10% since Uber arrived

(Cabs have been protected because 97% of rides start in Manhattan or airports; most Uber rides begin in outer boroughs)

For years, government regulators warned that banks were lending to taxi driver-owners who could not afford their loans. But despite the warnings, top officials in NYC, Albany and Washington did little to stop the crisis.

Here is Part 2 of our series: nytimes.com/2019/05/19/nyr…

Under Mayors Michael Bloomberg and Bill de Blasio, NYC made more than $855 million by selling taxi medallions and collecting taxes on private transfers. But in the quest for revenue, the city allowed an iconic industry to fall into crisis

nytimes.com/2019/05/19/nyr…

On February 26, 2014, NYC held its final independent taxi medallion auction. At the time, concerns about medallion prices were becoming common, and Uber was expanding. But the city still sold to more than 150 high bidders

40% of them are now bankrupt

nytimes.com/2019/05/19/nyr…

To report our series on the taxi industry, the @NYTimes interviewed 450 people, reviewed thousands of documents and built a database of every medallion sale since 1995. But most importantly, we listened to lots and lots of cabbies like Mohammed Hoque

nytimes.com/2019/05/19/nyr…

The project was edited by the great @KirstenDanis

It was fueled by compelling @KholoodEid photojournalism & contributions from @EmmaGF, @hillingers, @derek_m_norman, @elishacbrown, @Lindzcook, @DebonairPierre, @sameenamin, @susancb & more

Read their work nytimes.com/2019/05/19/nyr…