Nico Letters

The story is familiar: Mouhamadou Aliyu left Ivory Coast and came to the United States in search of a better life. He arrived in New York in 1994, worked in a warehouse, and eventually followed a friend into the taxi business. He’s been driving ever since.

In 2004, he thought he’d achieved his dream when he was able to buy his own taxi medallion, the coveted metal plate that allows a driver to own a cab instead of having to lease one. “Back then,” Aliyu says, “a driver being able to purchase their own medallion was more than just a smart investment — it was the ultimate goal.” Owning a medallion meant a guaranteed route to financial security; it was the equivalent of a retirement fund or owning a home.

The medallion system regulates the number of yellow taxis operating in New York City at any given time; since 1937, each vehicle has needed one in order to legally transport passengers. Most drivers lease them — paying around $100 for a 12-hour shift — but about 6,000 of the city’s taxi medallions are owned independently by so-called owner-drivers like Aliyu, 47. For years, the limited number of medallions issued by the city made each one highly valuable.

But while the medallions used to be seen as a smart long-term investment for drivers who had built up enough equity to secure a loan, they’re now considered a dangerous liability; their value has plummeted in recent years. Caught in the middle of it all are drivers like Aliyu, who were seduced into bad loans by exploitative brokers and government agencies willing to turn a blind eye to risky lending practices. Now, after years of inaction and fierce competition from ride-hailing apps, many cab drivers are demanding total loan forgiveness from the city.

The magnitude of the problem is hard to comprehend. The price of a medallion went from $360,000 in 2004 to over $1 million in 2014, around the time Uber and Lyft were turning anyone with a car into a driver for hire. By January 2018, the medallion’s value sank to less than $200,000, marking one of the lowest monthly average sales prices in years. Roughly 4,000 drivers drained their life savings to purchase medallions, according to a 2019 New York Times investigation. Many of them are barely hanging on.

“They’ve completely destroyed us,” said Aliyu, who joined a caravan of yellow taxi drivers demanding debt relief on the Brooklyn Bridge in February. “We’ve been taken advantage of as a group of immigrants who came to this country in pursuit of opportunity,” he said. “This system has been so predatory to us.”

Aliyu purchased his medallion through a city auction in 2004 with a loan of around $330,000. Today, it’s worth less than a third of the price he paid for it — and he’s in debt to the tune of $630,000. A spate of recent suicides over the past two years has been linked to the way taxi drivers were steered into loans that they couldn’t afford, spreading financial ruin and personal despair. “I used to think about suicide a lot,” says Aliyu. “[But] I have a wife and four kids to support. I have to keep working.”

For decades, lending institutions and taxi industry leaders have engaged in predatory or unpredictable lending practices by driving up the value of medallions, and thrusting independent owner-drivers like Aliyu into reckless loans. While the Taxi and Limousine Commission has considerable authority over cab regulations, it’s still unclear if the suspicious lending methods used by brokers were illegal.

The 2019 Times investigation into those responsible for driving up the price of medallions shed light on some of these practices, and the role played by industry leaders and government agencies. The investigation prompted calls by state and local lawmakers to help debt-laden medallion owners through a loan forgiveness program spearheaded by New York Democratic Congressman Gregory Meeks.

“We’ve been pushing our Congressional legislators nonstop to include the Meeks bill in the next round of stimulus,” said New York City Council candidate Felicia Singh, whose father, Dalip Singh, purchased a medallion in 1998 for around $250,000 after emigrating from India. New York lawmakers did work to include the Meeks proposal in President Joseph R. Biden’s $1.9 trillion COVID stimulus plan, but the measure was left out of the relief package in the end.

The ultimate fate of the bill is unclear, but for the Singhs, the need for loan forgiveness remains urgent. The city’s bankruptcy court is now asking for more than $250,000 to keep the house the family has owned for more than two decades. “You never get out of this job,” said Dalip Singh, 66. “The only way we can survive is if someone steps in to eliminate our debt. Otherwise, we’ll have to give up our house.”

While action at the federal level appears out of reach, some New York City politicians have continued to argue that large-scale measures to provide relief for taxi drivers are imperative, considering the government’s role in steering a largely immigrant population into dangerous loans. In 2019, City Councilman Mark Levine, a progressive representing Manhattan’s seventh congressional district, urged legislators to step in to provide immediate debt relief.

“We are directly responsible for the inflation of medallion mortgages…and therefore we have a moral responsibility to repair the damage that’s been inflicted on these drivers, and their families, and their communities,” Councilman Levine said. He went on to directly blame the city government for years of inaction: “The city itself is culpable. The city itself has profited from this bubble…and was asleep as thousands of drivers entered into a world of financial hell which is ruining their lives and those of their families.”

For Bhairavi Desai, the executive director of New York Taxi Workers Alliance, a union representing taxi and ride-share drivers, the dangerous lending methods used by brokers and city agencies underscores larger injustices between medallion owners and lenders.

“[The] rich got richer and the city raked in profit, while working-class immigrant drivers of color were swindled and pushed into financial despair,” Desai said in a NYTWA press release last year.

Besides deceptive brokers and complicit government agencies, many drivers blame the rise of largely unregulated ride-hailing apps like Uber and Lyft for the declining medallion prices. “They’ve left us with absolutely no business since they entered the market,” said Matey Krastev, 56, a yellow cab driver from Bulgaria. Like Aliyu, Krastev dreamed of owning a medallion when he arrived in the United States. Now, he’s glad he never had the opportunity.

Uber officially went live in New York in 2011; by 2014, the year the medallion bubble began to collapse, the company’s cars outnumbered taxis and led to millions of lost rides for owner-drivers. Some of them, noticing the steep decline in passengers, simply hedged their bets and decided to leave the taxi business altogether. But for those who had exhausted their life savings to purchase medallions, the situation continued to spiral out of control.

“Uber and Lyft came in and took more than 40 percent of my business [in 2014],” said 61-year-old Partart Singh, an Indian immigrant living in Queens. More than a decade ago, Singh purchased a medallion for $140,000 after taking out a loan with nearly 15 percent interest. Like Aliyu, he’s more than $600,000 in debt and says he has no plans to retire. “At one time I had a very good future,” said Singh, whose daughter, Jaslin Kaur, is running for a City Council seat in Glen Oaks. “[But] now I have to work until [my] last breath.” Singh believes the only way forward is if the city steps in to control ride-share apps and provides funding for insolvent medallion owners.

Through all of this, legislators and city officials have been eager to single out Uber and Lyft for the impact they’ve had on sinking medallion prices. But more often than not they neglect the vulturine lending practices that brought owner-drivers to their knees long before these companies even existed.

Since a 2018 cap on ride-share services, which changed virtually nothing for owner-drivers, little concrete action has been taken by the council. State Attorney General Letitia James recently announced plans to sue the city for the Taxi and Limousine Commission’s role in fraudulently inflating medallion prices for decades. “The City of New York and the TLC have promoted ownership of taxi medallions as a solid investment with steady growth,” James said in the statement. “[But] the city also permitted taxicab brokers and other large owners to not only ‘bid up’ the price of medallions, but also to collude on pricing.” So far, it’s uncertain whether James’ $810 million suit against the city will actually lead to cash in the pockets of medallion owners.

For City Council candidate Jaslin Kaur, it’s hard to be optimistic. She says owner-drivers like her father have seen this drama play out at the city-level before. “People just keep kicking the can back and forth to each other,” said Kaur. “The city has a lot of work to do if they want to negotiate a budget that actually works for cab drivers.”

As for Mouhamadou Aliyu, he has a dour view about his own future — and that of his wife and four children. Like many of his fellow owner-drivers, he blames the growth of Uber and Lyft but says they don’t tell the whole story. The story, he says, is about immigrants and the manifold ways they’ve been cast aside by a system they thought could help them.

“I came here with big dreams,” he says. “But this is not how we do things in this country. This is not America.”