The trouble with taxis. Disruption of an industry doesn't justify a bailout of its investors.

Crain's New York reports:

Taxi medallions were the surest bet in business for more than seven decades. With their supply limited and a seemingly endless number of New Yorkers hailing rides, the value of medallions kept going up. Even as the purchase price crossed the $1 million threshold a couple of years ago, medallions looked like a good investment, and purchases could be financed at low interest rates because defaults on medallion loans were so rare.

That's changing. Taxis collected 5% less money from riders in December than in the same month a year earlier, and medallion owners have had to reduce lease prices to attract drivers who, along with riders, have been turning to app-based car services such as Uber and Lyft and to green cabs in the outer boroughs. New Yorkers have also been using the subways in record numbers, not to mention bicycles.

Suddenly, the ride has gotten bumpy for taxi moguls including Evgeny "Gene" Freidman, a former Crain's 40 Under 40 honoree who made a fortune buying and leasing medallions to drivers. He hasn't kept up with loan payments on some of his medallions, and Citibank has moved to foreclose on 87 of them.

Mr. Freidman's response was bold, to say the least: He called for city taxpayers to guarantee his medallion loans, arguing that foreclosures would disrupt the industry, cost the city tax revenue and inconvenience the riding public. A bailout would be justified, he added, because he'd paid the city $300 million at medallion auctions over the years.

The risks of being a rent-seeker!