Taxis are both a mediocre margin business, and typically cartel restricted. Many people here are likely familiar with the absurd stories of the NYC medallion prices from just before Uber took over (a million dollars for a taxi medallion, before Uber smashed the cartels, tanking the value of the medallions). NYC extracted $855m in medallion fees from just 2004-2014.

So how did the eg NYC medallions become so valuable? The taxi cartel bought into the (mostly unspoken) notion that the medallions represented a government guaranteed blockade on competition. For a city like NYC with rather epic taxi demand, a license to print even just 8% margins perpetually can be an enticing prospect (especially in an age of forever low interest rates). Then, instead, the city governments mostly allowed Uber and Lyft to continue to operate (after their initial move to operate first and seek forgiveness second), rather than shielding the taxi cartel from competition.