The legislature had a choice if it wanted to help Denver's unhappy cab drivers.

The easy, inexpensive, sensible solution would have been to liberalize entry into the market. That's what House Bill 1114 was originally designed to do. It inspired hundreds of cabbies to park their vehicles and come into the Capitol for several hearings this session.

It would have given them the right to succeed or fail in a competitive market by establishing their own companies, subject to insurance and safety regulations.

But of course the legislature ended up opting for the more complicated, more expensive, bureaucracy-expanding method. It rewrote the entire bill and simply authorized the Public Utilities Commission to examine the leasing fees that the three local cab companies charge their drivers. That's not quite the same as establishing the fees, but it's a step in that direction.

Regulation of lease fees is a poor substitute for a competitive market where prices and service determine a cabbie's success, but it may be the only alternative. Right now the cab companies have the best of both worlds. The PUC makes it virtually impossible for a competitor to set up shop, and yet the agency has no power even to examine, let alone control, the lease fees set by the three oligopolists.

Drivers complain it costs as much as $600 a week to lease a company cab or use its logo on their own vehicles.

The cab drivers were so grateful for the sop they got in the rewritten bill that many of them applauded its passage by the House transportation committee.

The hundreds of drivers, many of them immigrants from Africa, were well behaved as usual, but it didn't get them much. Maybe they should have mustered some Menace. You want to see Menace at the Capitol? Just reintroduce another mandatory motorcycle helmet bill. That's why lawmakers try such a measure only once every term-limits generation.

To be sure, Menace works better in killing bills than passing them.

The cab companies must be heaving a sigh of relief. As one critic put it, "they managed to kick the can down the road."

It cost them money to do the kicking. They had to hire additional lobbyists, get the Denver city administration to come out against the bill and - perhaps most effectively - convince the committee that the issue was too complex to pass this year.

But it wasn't that complex. The legislature had only to decide that entry into the market should be liberalized and then broadly authorize the PUC to establish insurance, safety and pricing guidelines. It didn't have to sweat those details itself.

John Zakhem, who represented the group promoting the bill, seemed sunny Friday despite its fate. "This is better than anything that's happened before," he said. "At least we'll see some oversight on cab company leases with drivers. It's not a total defeat." He hopes with more training the cabbies might get better at "grass-roots lobbying."

The fate of the bill proves again how hard it is to make a U-turn once the state adopts bad economic policy.

The state-enforced taxi oligopoly has been around for decades. All previous efforts to open it have failed. The cab companies can afford to hire expensive lobbyists. But the consumers who might profit from reform don't have lobbyists because it's not that big a deal in their daily lives.

The difference this year was the continued pressure from the drivers, who only recently became involved.

It's not just the taxi industry that's almost impossible to reform. So are the blue laws that prevent the sale of autos or bottled alcohol on Sunday, and the laws that keep grocery stores from selling anything stronger than 3.2 beer. Liberalize the law and you disrupt a comfortable status quo.

But monopolies and oligopolies "are dead, they don't serve people well - and they overcharge," says Ray Gifford, a former PUC commissioner who favors more deregulation.

Peter Blake

COLORADO POLITICS

The cab companies must be heaving a sigh of relief.

blakep@RockyMountainNews.com or 303-954-5119.