Uber Technologies Inc. has taken a crucial step into battle with taxi companies by hiring consummate political operator David Plouffe to do its lobbying. If it wants its charm offensive to succeed, it should also do a much better job of getting along with actual taxi drivers.
Taxi companies, with their power on the local and state levels in the U.S., are outspending and outmaneuvering Uber when it comes to lobbying -- a phenomenon the Sunlight Foundation detailed in a recent report. Taxi owners are getting anti-Uber legislation initiated throughout the U.S., while Uber is not even on the list of the tech industry's top lobbying spenders.
Plouffe, who ran President Barack Obama's 2008 election campaign and helped run the 2012 one, sounds as if he's going to war:
I've watched as the taxi industry cartel has tried to stand in the way of technology and big change. Ultimately, that approach is unwinnable. But I look forward to doing what I can right now to ensure drivers and riders are not denied their opportunity for choice in transportation due to those who want to maintain a monopoly and play the inside game to deny opportunity to those on the outside.
It's easy to be righteous when your opposition includes characters like Symon Garber, the immigrant from Odessa whose Yellow Cab SLS Jet Management Corp. owns 275 New York taxi medallions, worth more than $1 million each. Jet has just been hit with a $1.6 million fine for illegally fining drivers who would not prepay for medallion leases. Ask yourself who you would be more comfortable enriching with your dollars: a courageous Silicon Valley startup or someone like Garber? Defending choice also comes naturally to a Democratic politician such as Plouffe. It's the kind of clear-cut issue that campaign managers love and know how to get across.
It's not all so simple, though. No amount of legislative lobbying will prevent angry cabbies from attacking Uber drivers and passengers like they did in Paris in January, breaking the windows of an Uber car and leaving a passenger cut with flying glass.
Uber has fueled the animosity with its arrogant approach. The company thumbed its nose at tiny fines imposed by flustered European city authorities -- what's Berlin's $33,000 fine to a company valued at $17 billion? "We have to bring out the truth of how evil Taxi is," Uber founder Travis Kalanick says of his main opponent.
Drivers take this personally. London's blogging cabbie, Richard Cudlip, sees hailing apps as unfriendly toward people like him. "Do they have drivers interests at heart?" he wrote recently. "Definitely not. Do they even have customers interests at heart? Almost certainly not. What they really want is to re sell my work to me for a fee. Isn't technology wonderful?" In San Francisco, taxi drivers are unionizing to resist the Ubers of the world.
Taxi company owners may play dirty and incite drivers against Uber. Local bureaucrats may resent challenges to their power to regulate the market and extract licensing revenues. These interests are, indeed, anti-progress. Consumers should decide how they want to get around. Making enemies of working folks like the drivers is not a good idea, though. It is unnecessary and it subjects Uber passengers to risks associated with violent action.
The campaign Plouffe ran for Obama actively engaged ordinary people and collected lots of small contributions. Uber's new vice president for policy and strategy should draw on that experience and work on making his company's business model acceptable to traditional cabbies, whether they choose to stay within the regulated industry or try a new way of making money.
Despite Pouffe's martial mind-set, he has the political intelligence to avoid hubris. "What's the motivation of those who are trying to protect the status quo?" the Washington Post quoted him as asking. "Where's that coming from?"
These are the right questions.
This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.
To contact the author on this story:
Leonid Bershidsky at email@example.com
To contact the editor on this story:
Mark Whitehouse at firstname.lastname@example.org