Uber

Uber Learns That As a New Company, To Be Is To Lobby

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Jesse Walker wrote earlier today about how municipal politics always tends to overvalue the entrenched interests vs. competitors that might make things better for consumers, in the context of Uber and others in that smartphone app ride summoning space eternal fights against local government petty tyranny.

One of the biggest ways that government hobbles the economy is the amount of resources and time that any company, especially one trying to innovate, has to dedicate to paying pros to help convince the government to let them keep operating (and often, to do things that make it harder for others to operate).

Los Angeles Times has surveyed Uber's growing into a lobbying machine in California as it fights off simultaneous assaults about whether its contractor drivers should be legally treated as employees, and whether it is supplying sufficient information about its operation to state regulators:

Uber now spends more on lobbyists in California than Wal-Mart, Bank of America or Wells Fargo…[its] spending on Sacramento lobbyists puts it in the top 3% of companies and organization….

Uber's growth strategy works both financially and politically. The playbook can be summed up in three phases: Rush into new markets; build loyalty among drivers and customers; use those constituencies to help fend off blowback….

 Before last summer, Uber had never spent more than about $42,000 on lobbying in any three-month period, according to state records.

But when [proposed legislation on their insurance and background testing policies] came to a head late last summer, Uber increased its spending more than tenfold, doling out $474,182 between July and September. The lobbying roster included the powerful firm Gonzalez, Quintana & Hunter, which also represents the Building Industry Assn. of California and the city of Los Angeles.

So far in 2015, Uber has paid about $200,000 to lobbyists. That's more than 10 times the amount spent by the limousine industry and nearly four times greater than the taxi industry's trade group.

There are more subtle ways to try to get politicians on your side than frontal lobbying:

Uber also courts politicians in ways that do not have to be publicly disclosed, like campaign donations or lobbying bills.

For instance, Uber has been a major sponsor of the U.S. Conference of Mayors. That organization, for mayors of cities with a population of 30,000 and higher, meets several times a year. Uber has sponsored events at several of those meetings, including a lavish late-night reception at the Astor Ballroom in Washington, D.C.'s St. Regis Hotel last January.

In August 2014 — when cities were grappling with whether and how to regulate Uber — Sacramento Mayor Kevin Johnson, the mayors conference president, conducted a one-on-one onstage interview with Uber founder Travis Kalanick at a conference event. In January, he did the same with Uber executive David Plouffe, a former political operative who ran President Obama's 2008 campaign.

The company last October donated $50,000 to the African American Mayors Assn. — a group Johnson created just a few months earlier. Uber acknowledges the donation but declines to say how much it has paid to the Conference of Mayors.

Sadly, whatever it was, it will likely never be enough to stop. As long as officeholders have power over those trying to make a living, it behooves those trying to make a living to appease the officeholders.

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  1. Uber also courts politicians in ways that do not have to be publicly disclosed, like campaign donations or lobbying bills.

    At least Uber has an internal way of transporting the hookers and blow right to the politicians.

  2. And the cycle of legislative violence continues…

  3. The lobbying roster included the powerful firm Gonzalez, Quintana & Hunter, which also represents the Building Industry Assn. of California and the city of Los Angeles.

    One imagines lots of table napkins with figures written on them being slid across tables, glances being shot across said table, and said napkins going into jacket pockets.

    This is how business is done in Progressive America.

    We’re all living in The Wire’s Baltimore now– where “Democrats outnumber Republicans nine to one.”

    1. “We’re all living in The Wire’s Baltimore now– where “Democrats outnumber Republicans nine to one.”

      Riiiight. Because Republicans are so different.

      1. Republicans at least have a sense of shame when they get busted. Good luck finding footage of Democrats getting busted and having a sense of shame.

        1. tribalism: the cause of and solution to all of life’s problems

      2. I would say in places where there is one party rule, the pols can drop any pretense to shame. Because of the country’s demographics,.the Dems have more assured areas of one party rule, hence they do not even have to pretend to feel chagrined by getting caught.

  4. It’s just cronyism all the way down.

    1. It’s Mitch McConnells all the way down.

  5. When I used to lobby and I would hear someone bitching about lobbyists, I would say “you know the quickest way to get rid of 90% of lobbyists? Get rid of 90% of government.”

    Other than a few mumblings about roadz and chillens, most people just got a glazed, bovine look on their faces.

    1. 90% of the government is not authorized by Article I Section 8.

    2. “you know the quickest way to get rid of 90% of lobbyists? Get rid of 90% of government.”

      More than a little disingenuous considering the lobbyists are working to keep that from happening. With the Ex-Im spectacle of the past month, you can’t really blame the voters for that.

      1. How does that make it disingenuous?

        1. It doesn’t, he’s trolling.

          Fish and chipper hits the nail on the head, your average voter has no clue that with the government tentacles into virtually everything it makes it easy for cronies to grease the necessary palms.

  6. The average person doesn’t understand that, although it is true that some businesses lobby to gain unfair advantage, other businesses lobby because they have to.

    It’s why proposals to flat-out ban lobbying always make me cringe; besides the First Amendment issue, such proposals cast too wide a net.

    1. I’m sure many businesses believe they lobby only “because they have to”. Particularly if said business is a large incumbent that’s losing its competitive advantage to pesky innovative start ups. They have to lobby for burdensome regulations or else they’ll be outcompeted.

  7. It absolutely disgusts me that a company like Uber has to spend one red fucking cent on lobbying.

    -jcr

    1. And they really do have to. Look at the monopoly case against Microsoft. They were under the impression that as long as they were good at supplying a product, that was enough. People aren’t that naive anymore.

      1. They were under the impression that as long as they were good at supplying a product, that was enough.

        Microsoft’s products at that time were garbage. And they rose to market dominance by bareknuckle and borderline dishonest marketing tactics, not by producing a product anybody wanted.

        1. They were such garbage 99% of the computing world used them. You should probably think before you speak.

          1. This is the fabled tulpa! Engaging mind before poking keyboard is not among his skills!
            Oh, and tulpa? You’re full of shit.

          2. Oh for freaks sake. 99% of people vote for the Dems and Reps. Must be because they offer everything that anyone could possibly want from a political party.

            1. Uh no, they just lie about what they are supposed to be offering and for whatever reason people buy their bullshit.

        2. They rose to dominance primarily because they did not think they had to keep their software proprietary to their hardware. That is what made them the ubiquitous OS. They may not have been better but they were more accessible.

    2. A number of corporate officers have learned that the fastest way to a medium-security federal prison is not providing baksheesh to the Brahman.

  8. Jesse Walker wrote earlier today about how municipal politics always tends to overvalue the entrenched interests vs. competitors that might make things better for consumers, in the context of Uber and others in that smartphone app ride summoning space eternal fights against local government petty tyranny.

    Brian Doherty doesn’t type. He dictates his columns to Dragon. The periods are where he ran out of breath and passed out.

    1. Either that or he upgraded to Dragon 10.5.

  9. See? The system works!

  10. “any company, especially one trying to innovate”

    Most of what Uber is lobbying for has nothing to do with “innovation,” but is brazen rent-seeking.

    No matter how much one dislikes, say, a labor rule, it is not consistent libertarian thinking to insist that a company or industry should be exempt from those rules simply because it “innovates.” That’s the Solyndra way of thinking, even if you’re actually championing Tesla.

    This is little different from the kindergarten libertarianism of the closet homophobes who screeched about “getting out of the marriage business” only when it was the uppity gays who dared to think that “equal treatment under law” was actually a libertarian principle, silly them.

    1. Most people here advocate for deregulating the regular cap companies, an utterly entrenched industry.

      1. Often times with politicians having family members who own cab companies.

    2. Further, it’s often the garden-variety progressive who calls for an industry to be able to bypass regulation, because it’s “innovative”– which is often another term for hip young people starting a business that’s kind of like an existing industry, but with an interesting twist which threatens the politically connected, established industries.

      Christine Gregoire attempted to have the ZipCar (type) industries exempt from the rental car tax, because it was “innovative”– thus accidentally admitting that taxation stifles innovation.

      She was correct on the latter concept, but I agreed with the rental car agencies on that one, it’s a rental car, just short term, why are they exempt from the tax structure?

    3. No matter how much one dislikes, say, a labor rule, it is not consistent libertarian thinking to insist that a company or industry should be exempt from those rules simply because it “innovates.”

      Actually, the libertarian would more likely say that the rule shouldn’t exist for any company, innovative or stuck-in-the-mud.

      1. I replied to this clown, but erased my post. You are spot on Larry, forcing all to lap up the stateboner equally is not libertarian to me.

        Rent seeking is the same , yet this clown thinks everyone should rent seek equally. It doesn’t matter i f one likes Tesla or Solar City, Musk’s whole business model is based on rent seeking. It’s baffling to me why people admire this leech.

    4. But Uber is a different industry from the cab companies. Uber’s partners choose their hours, their territory, whether they’ll take a ride, and they’re prohibited from being hailed.

    5. Uber is not in this to promote libertarian ideology, they trying to run a transportaton company with a different type of operating plan from their more establishef competitors. They are going to play the game as it exists, not as you would like it to exists. Unfortunately, that may eventually lead to them.becoming part of what they are fighting, but their goals are not yours or mine or Reason’s.

  11. It’s kind of a tragic reflection on the contemporary economy, that the only feasible ways left to innovate in the market comprise attempts to do end runs around the occlusive regulatory miasma of govt.

  12. Look mfckr, do you not appreciate the number of jobs created by people that exploit loopholes in burdensome over-regulation along with the people who get to squawk about it to get the loophole closed. I won’t even mention the number of people benefiting from operating within the same burdensome over-regulation. How many accounting/preparation jobs would it cost to implement a flat tax and that is just the tip of the iceberg at least until global warming wipes out all of the icebergs.

    Do you not understand how the government stimulates the economy and creates jobs, mfckr? Sarc off

  13. “When you see that trading is done, not by consent, but by compulsion?when you see that in order to produce, you need to obtain permission from men who produce nothing?when you see that money is flowing to those who deal, not in goods, but in favors?when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you?when you see corruption being rewarded and honesty becoming a self-sacrifice?you may know that your society is doomed.”

    That nutty Rand.

    1. I never could get into Ayn’s work. If only she were more concise in stating the self-evident.

      1. Ha, my sarc meter was off on first reading your comment. Though not one who has read her (beat me with a wet noodle) that’s a pretty potent paragraph.

        1. I’m more of a Hayek fan:

          “We must make the building of a free society once more an intellectual adventure, a deed of courage. What we lack is a liberal Utopia, a programme which seems neither a mere defence of things as they are nor a diluted kind of socialism, but a truly liberal radicalism which does not spare the susceptibilities of the mighty (including the trade unions), which is not too severely practical and which does not confine itself to what appears today as politically possible?Those who have concerned themselves exclusively with what seemed practicable in the existing state of opinion have constantly found that even this has rapidly become politically impossible as the result of changes in a public opinion which they have done nothing to guide. Unless we can make the philosophic foundations of a free society once more a living intellectual issue, and its implementation a task which challenges the ingenuity and imagination of our liveliest minds, the prospects of freedom are indeed dark. But if we can regain that belief in power of ideas which was the mark of liberalism at its best, the battle is not lost.”

          https://en.wikiquote.org/wiki/Friedrich_Hayek

            1. PS I get that a lot of people here like Ayn Rand, but I do not. Ayn Rand was not a libertarian, and Objectivism is garbage. I am interested in reforming the state. How people run their own lives is not of interest to me, but when I studied ethics @ university I found a wide variety of ethical frameworks to be far more compelling than Rand’s work.

              1. Yeah. AFAIK, Ayn Rand harshly rejected Libertarianism too.

                If one desires a coherent philosophical outlook for understanding the vital role of free-market economics to society, they’re better off reading the Austrians (Hayek, Mises, Rothbard? etc).

                And as far as arguments for ethical egoism, I’m not really sure what unique insights Objectivism adds to the subject. There’s far more interesting and nuanced arguments for this sort of thing among the likes of Max Stirner, or even Sartre.

                Also, Rand’s ontology is retarded.

                1. I mostly like rand for the couple of good quotes like the above which manage to have a poetry about them, and such gems are so great that they almost make it worthwhile to read through the baffling romances that one has to slog through to get to them.

                  Unfortunately, Rand was no George Orwell, a master of language and brevity, so the filler to gold ratio is sometimes unbearably high.

                  As to her dedicated philosophy rather than literature, I know next to nothing.

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