Koch-Backed Uber Campaign Seduces MT Democrat Legislator

by William Skink

Before our eager MT legislators champion a bipartisan push to deregulate taxi service in Montana for Uber, they might want to read about the Uber battle in Madison, WI.

Here is a good description of the exploitive business model Uber and Lyft have taken advantage of. The municipalities fighting back are facing aggressive marketing campaigns:

Both companies claim to be “disruptive innovators” that shake up the status quo in the out-of-date taxi industry that still relies on human beings to do the work of matching people with rides through dispatch offices.

But there is nothing innovative about serving the function of an exploitative middleman.

In fact, it’s as old as the unregulated market itself.

In this unregulated market, workers can get exploited, price gouging can arise, and the risks to public safety can escalate.

Drivers sign up to be “partners” with Uber or Lyft and access customers through a smart-phone app. Customers give their credit card and social network information to the companies, and then sign into the app and request a ride from the nearest available “partner.” The company takes 20 percent of the charges off the top and the driver keeps the rest.

Drivers are responsible for all operational and maintenance costs. Most people who drive for Uber and Lyft do not carry commercial insurance and are, in fact, committing insurance fraud by not disclosing to their insurer that they are using their vehicle for commercial purposes.

If drivers are injured on the job, they are not covered by workers’ compensation. All the risk and capital investment are shouldered by the driver, while the fat cats at Uber and Lyft headquarters in San Francisco reap a risk-free reward.

In addition to exploiting labor by externalizing risk and vacuuming up profit, Uber drivers are sometimes not on the up and up. Surge pricing gauges customers, and sometimes even worse things happen than an obscene bill:

Uber claims to be matching supply and demand for rides through what it calls “dynamic surge pricing.” When demand for rides outstrips the current supply of drivers, the price for rides multiplies, sometimes up to 775 percent. That’s what happened to New Yorkers last winter during a blizzard, when at least one customer was charged $132 for a six-block ride.

On New Year’s Eve in San Francisco, a man who was allegedly logged in to Uber’s system and had passed a background check as a driver for the company ran over and killed six-year-old Sofia Liu. Her family is suing the company, which has denied any wrongdoing.

In other incidents in Washington and Los Angeles, Uber drivers allegedly kidnapped passengers. One driver took a drunk woman to a cheap motel and spent the night with her, according to the Los Angeles police.

Local and state governments are trying to find a way to deal with aggressive marketing by Uber and Lyft. California and Colorado have passed laws regulating the companies. Public service commissions in Nebraska and New Mexico, as well as the Virginia Department of Motor Vehicles, have placed explicit bans on their operations.

Some cities—including Baton Rouge, Chicago, Columbus, Detroit, Houston, Los Angeles, Milwaukee, Minneapolis, Seattle, and Washington—have passed local ordinances to govern them. Ann Arbor, Memphis, and St. Louis have taken a harder line, issuing cease and desist orders, impounding vehicles, and levying fines on drivers.

North Carolina went the other way and actually passed a law prohibiting municipalities from regulating what they call “digital dispatch” services. This effectively gives Uber free rein to operate anywhere in the state without having to abide by taxicab ordinances.

Twenty-one states have now issued consumer alerts warning the public that anyone who steps into an Uber or Lyft vehicle takes a big risk, and the University of California is considering barring employees from using these services during business trips citing liability concerns.

So how does Uber respond? They hire some lovely people to help them:

Uber is responding by bringing out the big guns. In August, Obama campaign manager David Plouffe joined Uber as a senior vice president of policy and strategy, and in mid-September former Defense Secretary Robert Gates signed on as chair of the advisory board to UberMilitary, a program to recruit veterans (and their personal vehicles) as “partners.”

In an attempt to build political support, Uber also sponsors big national conferences and offers discounted fares for attendees.

Last summer it sponsored Urban Shield, a weapons and tactics convention in Oakland. It also used Mothers Against Drunk Driving to promote its service over the Fourth of July weekend.

And the company is recruiting its customers to lobby on its behalf. Uber offers free and discounted rides to new users, and then tries to turn them into political supporters to fight the corporation’s battles with local and state government. Since there is actually no corporate office or local staff in most of the cities in which it operates, Uber exploits the time and energy of its “partner” drivers and customers to wage its ground wars on its behalf.

Uber’s strategy and ideology perfectly mesh with the rightwing attack on government regulation, and it makes no bones about that. It has joined forces with the Republican National Committee and Generation Opportunity, an astroturf group backed by the Koch brothers, to inundate social media with pro-Uber propaganda urging support of the free market and innovative entrepreneurs.

It has also gained the support of government-drowner Grover Norquist. In an opinion piece for Reuters’ website, Norquist explained why Republicans are so keen on promoting Uber. His piece was entitled: “Why Uber Can Help the GOP Gain Control of the Cities.” These new-fangled taxi companies “are favorites of city dwellers, which means most of the leading Democratic constituencies—including educated professionals, gays, minorities, single women and working mothers,” he wrote. “Cities may soon be up for grabs. For the party’s refusal to embrace the innovative technology and disruptive businesses that have greatly improved city life presents a challenge to Democrats — and an opportunity for Republicans.” He hailed the companies as shining examples of the post-union “share economy.”

Uber and Lyft entered the market in Madison, Wisconsin, this February, kicking off a major political battle.

“This is more than a discussion about taxicabs. It’s about place and values,” Paul Soglin, the mayor of Madison, said as he began his presentation to a city committee charged with exploring ordinance changes to regulate Uber and Lyft.

Reminding committee members that regulation exists to “bring equity to the marketplace and to ensure the health and safety of the public,” Soglin mounted a vigorous case for thorough regulation.

In case you missed it, let me highlight this part:

It has joined forces with the Republican National Committee and Generation Opportunity, an astroturf group backed by the Koch brothers, to inundate social media with pro-Uber propaganda urging support of the free market and innovative entrepreneurs. (my emphasis added)

Backed by the Koch brothers, huh? Normally I see our tech-savvy legislators on Twitter bemoaning the influence of the Koch brothers. Kind of awkward to see one of those legislators now cheerleading for the same thing a Kock-backed group is being paid to advocate for.


  1. steve kelly

    Uber hired David Plouffe as a lobbyist. Among Uber’s investors: Goldman Sachs, Bezos, Baidu, Google Ventures (Google Chief Legal Officer David Drummond is on Uber’s board of directors).

    What’s left to figure out. Run for you lives.

  2. Funny thing, the Koch bros were giving to both sides long before Uber came along.

    http://www.politico.com/story/2014/03/koch-brothers-democrats-104787.html

  3. Turner

    Which Democratic legislator?

    • lizard19

      Rep Hill.

    • JC

      Ellie Hill introduced HB 267

      “Montana Representative Ellie Hill (D-Missoula) has introduced a bill that would de-regulate the Montana taxi industry and allow for the operation of online ride-booking services like Uber…

      Missoula Green Taxi owner Mick Murray has been paying attention to HB 267’s progress in the legislature.

      “I see them as infringing on my business, in that they don’t have the same costs that I do. So, it would be easy for them to run me out of business,” said Murray. “Uber doesn’t pay payroll or workman’s comp taxes. They don’t carry commercial insurance…I welcome competition on an equal basis.”

      • I’ve spent a little while looking, but have yet to read anything from Rep. Hill as to why she sponsored this bill. I’ve sent a email with that simple question, but then I’m not a constituent of hers or even a citizen of Missoula. Have any of you asked her this, or have her reply to such a simple question?

        • lizard19

          she has a blog that hasn’t been updated since January. for someone who is known as being savvy with social media, maybe that would be a good forum to clarify why collaborating with right-wing deregulators is a good idea.

        • It is very easy for anyone with any agenda, any backing, to run as a Democrat. There’s no vetting process, and no accountability.

          Why is anyone surprised?

  4. JC

    Uber already is advertising in Missoula, Helena, and elsewhere in MT.

    Interesting as HB267 missed transmittal, and hasn’t had any action since the March 31st deadline. Does Uber know something that the public in MT doesn’t, hence the craigslist ads? Also, what about all those silver bullet tweets about Uber? Were the dems going to use one to blast it out onto the floor of the house (or just idle chirping)? Or is it going to get rolled into another bill?

    • Just a guy

      SB 396 is a bill of similar intent to Hill’s that passed second reading in the House today. Commenters here might read it.

      “Does Uber know something that the public in MT doesn’t?”

      This kind of trashy speculation is why Blackbirds lacks credibility. Everything they see that vaguely offends their emoprog sensibilities is instantly a conspiracy to defraud the masses. What exciting lives you must lead when your imaginary persecutors are behind every corner.

      Lazy cut n paste post and lazy, hackneyed commentary. By the by, Hill wasn’t the only Missoula D in support.

      • JC

        What’s trashy about it? All the things I spoke about are from information gathered elsewhere. Just because you don’t like the implications doesn’t mean that it isn’t relevant.

        And what is wrong with speculation about public information, particularly when it has to do with controversial politics? It seems more likely that you are just trying to rustle up some ad hominems to spike your punch.

        And did lizard or I suggest that there was only one “Missoula D” legislator in support of taxi dereg? No. He spoke in the plural, and I only said that Hill introduced HB267 and, which if you follow the link, is its only sponsor. If you don’t like the NBCMontana piece, take it up with them.

        And lastly, quit pulling the straw out of your ass to build strawmen. After all, you’re just guy…

      • Matthew Koehler

        Leaving aside my hunch that this anonymous poster is not “just a guy” why does this person fail to acknowledge the lead-in paragraph of this entire piece, which introduces (and then cites from) an article about Uber by non other than The Progressive (formerly fighting Bob “LaFollette’s Weekly”)?

        The Progressive only has about a 100 year history of championing “peace, social and economic justice, civil rights, civil liberties, human rights, a preserved environment, and a reinvigorated democracy.”

        Furthermore, The Progressive piece was written by Rebecca Kemble, a contributing writer for The Progressive and “a member of the Union Cab worker-owned cooperative in Madison, Wisconsin.”

        And what about the comments posted above from the owner of Missoula’s ‘Green Taxi?’

        “Trashy speculation?” “Lazy cut n paste post?”

        Whatever.

  5. steve kelly

    Classic neoliberal deregulation. Abolish regulations that impede market entry or restrict competition. Crony capitalism favors capital over prople and all other living things, and favors elites over all lower classes. Ask not what the colony can do for you, rather, ask what you can do for the colony and the elites that control it.

    Rep. Hill and many, many other Democrats either cannot understand, or choose to ignore, the key role they play in advancing the greater global system, which is driven by fudamenalist ideology and special interests seeking to profit by opening up new markets “at home” and abroad — regardless of the costs to workers, public safety, the environment and consumers.

    Many thanks to all those “Reagan Democrats,” “3rd-Way Democrats,” “Blue-Dog Democrats,” and God only knows what to call it now.

  6. James Maxie

    I travel constantly for work and I absolutely love Uber. I hate traveling to cities that don’t have it. Using the antiquated taxi system is a frigging joke. It’s inefficient and very dangerous to both the driver and the passenger. When a passenger enters a taxi, there is no record of that event. Both the driver and the passenger are protected by a cloak of anonymity. That isn’t the case with Uber. You’d have to be an extremely stupid person to use Uber as an avenue to assault someone as a driver or passenger. There’s a record of it. Think about it people…..

  7. mick

    SB 396 is a gift to UBER ,while doing nothing to change the regulatory constraints taxis are subject to. Fixed tariff, geographical limitations,employment standards,P.S.C. over-site and so on. Missoula representative Nate McConnell spoke eloquently against SB 396 on the floor. Hill was the only Missoula, Democrat? voting in favor. Ellie”race to the bottom”Hill,was disingenuous at best, when speaking on the floor about how this bill will effect Green Taxi. No other Missoula Democrat voted in favor. SB 396 is up for 3rd reading Monday at 8:00 A.M. Green Taxi did not protest any of the 4 ride services that started in Missoula after Green Taxi started, to address drunk driving, only to fail. Drinking till 2:00 A.M.- then wiggling your nose expecting a cab to show right up, is the same level of critical thinking that would lead you to think I could put another cab on the road, just for bar rush, I wish I could but the required costs associated with regulatory authority of the PSC prevent me from doing just that! Mr.Maxi, if you ride with Green Taxi I am required to keep a record of the trip. The Missoula Police make requests for this information from time to time. Speaking of the police-SEND HELP NOW! It seems as though I am going to be crushed! Please contact your Representative!

  8. mick

    SB396- Has Fred Thomas’s name at the top, as well,so it’s got that going for it.

  9. mick

    http://pagesix.com/2015/04/20/bill-clintons-spokesman-leaves-his-team-to-work-for-uber/

  10. mick

    A Foul Smell from DC
    A bad smell is coming from the East, and it ain’t landfill.
    It was reported this week that Denny Rehberg’s son, A.J., as well as Rehberg’s former chief of staff Leo Giacometto and former GOP senator Conrad Burns, are all hard at work together at their lobbying firm, representing the government of Mongolia before Congress, acting as Mongolia’s lobbyists. Denny, mind you, serves on the Mongolian relations caucus, and has had contact with the Mongolian government.
    The government watchdog group CREW is investigating this whole filthy circle of sleaze, and the efforts of these insiders to develop a uranium mine in Mongolia.
    Their firm is called GAGE. GAGE is essentially a receptacle–similar to the receptacle on the end of a condom–for all people in Montana who work for Republican politicians and then leave these government jobs to cash in as quickly as possible on their connections, by lobbying their former bosses on behalf of monied players like corporations or even foreign governments.
    Rehberg’s son has even been named vice president of a Mongolian mining corporation, whose headquarters–get this–is in Washington DC.
    And also mentioned in connection with GAGE, shockingly, was Matt McKenna, a former Tester communications director who apparently was working with Burns, Rehberg Jr. and Giacometto on the Mongolian uranium deal.
    I’m not really sure what to make of that. Perhaps we all have a price. Let’s hope he made a nice penny for spreading his legs.
    At least we know McKenna’s ashamed of his behavior. If you do a Google search with the terms “McKenna” and “Gage” and “Burns”, you will see, amid the links that come up on the first page of returns, several mentions of Mr. McKenna’s name made in conjunction with the GAGE firm, including what looks like a bio of him on GAGE’s website. But these links are ghosts. When you click on them, you discover that they’ve been scrubbed of any mention of McKenna.
    This entry was posted in 2012 Elections, Montana GOP, Senate, TEA Party and tagged A.J. Rehberg, Burns, Conrad Burns, Dennis Rehberg, Gage, Matt McKenna on October 20, 2011 by Cowgirl.

  11. Jerry

    Its cause Rep Hill has a hidden vendetta against the local taxis she isnt representing see the exhibits submitted to hj16

  1. 1 Bad role models | Piece Of Mind

    […] mean, if not that it is OK to be greedy, to crush other people in the marketplace? William Skink just wrote about this phenomenon wherein “Uber” is destroying business models and lives in the name of market […]




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