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Grover Norquist

Some Republicans really want to make Uber a partisan thing

A little adorable, and a little desperate.

Uber

Uber hired political strategist David Plouffe this week to run what amounts to a national political campaign against the taxi industry. Ostensibly, this is a fight between large taxi medallion investors and a multi-billion dollar tech startup, between cab companies and everyday Uber drivers, between entrenched power and technological change.

But it’s hard to ignore the context of the other political battle — the one between Democrats and Republicans — within which Uber is emerging as a potent, if contested symbol.

In recent months, prominent Republicans have championed the company as a model for the kind of “entrepreneurial spirit” that so often gets smothered by government regulation. Marco Rubio is a fan of Uber’s story. So is Reince Priebus. Grover Norquist has gone so far as to suggest that Republicans can leverage Uber, and other popular disruptors like it, to get back into the good graces of young, urban voters.

The RNC is even offering a “petition in support of innovative companies like Uber” right now with this ominous warning:

Across the country, taxi unions and liberal government bureaucrats are setting up roadblocks, issuing strangling regulations and implementing unnecessary red tape to block Uber from doing business in their cities.

We must stand up for our free market principles, entrepreneurial spirit and economic freedom.

But now here comes David Plouffe, the man who twice helped elect Barack Obama to the White House. And with an Obama insider helming Uber’s policy strategy, it will be that much harder to argue that Uber is the best symbol for why Republicans are right about the role of government and Democrats are wrong.

As I’ve written before, the actual politics around Uber have always been ideologically messy. We’ve seen Democratic mayors push for Uber-friendly regulation, and Republican governors stand in its way. And the most likely outcome for the company in any city resembles neither total deregulation (as GOP voices seem to be suggesting), nor stifling bureaucracy (as they hint that Democrats want).

I’ve written about this before as well. It’s hard to shoehorn an R-versus-D narrative into this when there’s no leading Democrat standing athwart Uber shouting “Stop!”, but I guess you play the cards you have. For what it’s worth, here in Houston the vote to allow Uber and Lyft was 10-5 in favor, with three Ds and two Rs voting No, and one of the members that was absent for the final vote (Dave Martin) was an R that would have voted No as well. (I don’t know who the other absentee was or how s/he would have voted.) I think most people recognize that Uber and Lyft are going to happen whether anyone likes it or not, that it’s not the government’s job to protect the business plan of an existing (and highly regulated) industry, and that there’a a place and a need for sensible regulations when a disruptive new business comes on the scene. If you prefer it all to be a battle of good versus evil, then sure, go read Grover Norquist’s bedtime stories. In the real world, people who want to make things work, on both sides of the aisle, will be busy trying to get things done.

More on the partisan lines of the Uber fight

From Wonkblog, another interesting look at how the fight over the so-called “sharing economy”, in particular transportation network companies like Uber and Lyft, is playing out nationally.

In its short life, however, the sharing economy has seldom reflected a clear schism between Republicans and Democrats — an argument Grover Norquist tries to make today in a provocative opinion piece for Reuters. Companies like Uber, he writes with Patrick Gleason, can help the GOP “gain control” of cities where they’ve been all but absent for years. Their logic:

Yet despite the Democrats’ urban dominance, 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.

Democrats are facing a tough choice. A big part of their base is the unions now facing off against such disruptive innovations as Uber, Lyft, Airbnb and charter schools. Do Democrats support the regulations pushed by taxi and other unions that help to protect the status quo but can also stifle competition? Or do they embrace innovative technologies and businesses that expand transportation options, create jobs and are increasingly welcomed by another key Democratic constituency: urban dwellers, particularly young urban dwellers?

Norquist and Gleason are right that there will no doubt be political fallout from the sharing economy. I recently met a number of cab drivers in Chicago who pledged to me that they would fight against the reelection of Mayor Rahm Emanuel because of his support for services like Uber and Lyft there. But it’s not at all clear that this fallout will favor Republicans.

[…]

The point here isn’t that Democrats are all supporters of the sharing economy. It’s that support isn’t as contingent on ideology as Norquist and Gleason suggest. And the political lines are definitely not so tidy as to suggest that Republicans can leverage liberals’ “refusal to embrace the innovative technology” to sweep back into favor with urban voters. There’s room here for Democrats to acknowledge that markets can partly regulate themselves — with the help of technology — in ways that weren’t possible in the past; there’s room for Republicans to acknowledge that we need laws mandating commercial auto insurance anyway.

We’ve heard a lot from Democrats on these issues precisely because they’re playing out in cities so far. And, inevitably, elected Democrats like Rahm Emanuel will be forced to take positions that will please some core constituents at the expense of others. The tension between unions and young consumers is particularly compelling. Republicans should absolutely jump into that fray. They haven’t found a lot of reasons to talk to urban voters lately — if people like Norquist think this is one, that’s great.

But the fact that this debate isn’t neatly drawn into liberal and conservative camps is a testament to the policy issues raised by the sharing economy: They’re incredibly, incredibly messy. They also aren’t purely about big-picture ideological battles over less regulation or more union power, the kind of divisive themes that animate federal policy debates. They’re about the gritty details of auto insurance policies and tax receipts and access for disabled consumers. That’s not the stuff of pithy partisan slogans.

As author Emily Badger notes, this issue has not played out along partisan lines so far. Uber and Lyft have made their way into cities like San Francisco and Seattle working with the local governments there. Trying to make this into an R-versus-D fight will surely be a loser at least in the short term precisely because cities are overwhelmingly Democratic right now. Uber and Lyft can’t get approved in Houston without at least two Democrats supporting it, and indeed can’t even come up for a vote without Mayor Parker putting it on the agenda.

Of course, Norquist is playing a long game, and a few losses up front aren’t a setback to him but a catalyst. I still have a hard time buying this as a wedge issue. Norquist envisions a future army of disillusioned Uber (and Lyft and AirBnB and whatever other sharing economy companies are out there trying to gain a foothold) users turning to his brand of small-government deregulators as the saviors of their smartphone apps. But most people who live in cities like having a certain level of service and infrastructure, and they accept that there’s a higher level of taxes to provide for that. It’s not exactly a coincidence that cities tend to be Democratic, after all. If what you really want is lower taxes and you don’t care so much for things like sewer systems and professional fire departments, well, that’s what the suburbs and unincorporated areas are for. It’s not like these are hard to find or move to in most metro areas.

Again, though, this is a long game. Norquist is hoping to bring younger people – those who are way more likely to be Uber users in the first place – to a more generalized preference of deregulation and less government. I like to think that the millennial crowd already has a clear view of what he’s trying to sell them, but let’s all admit that predicting what politics will look like in 20 or 30 years is considerably sillier than trying to predict what it will look like in 2 or 3 years, or even 2 or 3 months. One reason for that is because nobody knows what society will look like in 20 or 30 years. Uber thinks driverless cars will eventually replace their human chauffeurs. Some other people think driverless cars will be the end of Uber and its ilk. Who knows? Maybe society won’t accept driverless cars and unions like SEIU make a push to organize Uber drivers. Anything can happen, but that doesn’t mean it’s likely to happen.

Uber is working hard to make itself unlikeable

It’s almost as if it’s a deliberate part of their business plan.

“We’re in a political campaign, and the candidate is Uber, and the opponent is an asshole named Taxi,” Travis Kalanick, the CEO of ride-sharing company Uber, said while on stage at a conference in late May. “Nobody likes him, he’s not a nice character, but he’s so woven into the political machinery and fabric that a lot of people owe him favors.”

Kalanick wasn’t bluffing. Uber really is the candidate: It has been interviewing potential campaign managers–real ones, from real presidential campaigns–for months. A source close to the hiring process told me, “They want somebody who has been steeped in that political warfare.”

And for good reason.

In the process of trying to force regulators to concede to its enormous popularity, “Uber” has become, in some ways, a loaded political term. And observers and participants alike are questioning, in real time, how much government interference is too much.

Uber, which in June was valued at $17 billion, appears to be launching a full-scale political operation—complete with backroom operators and face-saving strategists.

To combat governmental hostility, Uber has hired political muscle all over the country: in D.C., it has the Franklin Square Group (Apple, Google). In New York, it has Bradley Tusk (Michael Bloomberg’s former campaign manager). In Chicago, it has Michael Kasper (the lawyer who got Rahm Emanuel on the ballot). Additionally, it has lobbyists in Miami, Baltimore, Houston, and Denver.

And Uber’s not the only member of the new sharing economy who’s gone political. Airbnb, a housing and rental service estimated to be worth $10 billion, has hired one of the most-connected operators in New York—and even formed its own “grassroots” political organization.

Kalanick (who did not respond to multiple requests for an interview) looks like a television preacher, appears on Gwyneth Paltrow’s Instagram, and once joked to a journalist about how the success of Uber increased his desirability to women: “Yeah, we call that the Boob-er.”

For a time, Kalanick’s Twitter avatar was the cover of Ayn Rand’s The Fountainhead—which he has repeatedly said was not the sort of bold political statement some have made it out to be. (In other interviews, he has indicated Rand has influenced his thinking.) But it is difficult to not see some parallels between Uber’s business model and libertarianism.

Given that, it’s not surprising that Uber is gaining friends on the right side of the political aisle. For example, Grover Norquist, the anti-tax activist, on Thursday Tweeted “Today, there are two political parties/movements in America. One is UBER, the other is with taxi commission. Choose.”

Overwhelmingly, the political types who openly support Uber—Norquist and Republican Senator Marco Rubio, to name two—are the ones who were demonizing regulators long before the phrase “call an Uber” had ever been uttered. But now, of course, the phrase has been said millions of times in multiple languages across the globe.

Companies like Uber—along with Airbnb and less popular services like Zilok (which lets you rent “anything” from strangers)—make up the sharing economy, a community in which individuals rent out their possessions or their labor, and businesses act as middlemen, helping to arrange plans. Uber and Lyft (another ride-sharing service) will connect passengers with drivers, but won’t provide a car. Similarly, Airbnb will introduce homeowners to those looking for a place to stay, but doesn’t own properties.

The distinction of not owning any hardware, sharing economy companies would like customers and regulators alike to believe, should make all the difference when it comes to the law. Except, it doesn’t—at least not yet. The fact remains that Uber and Airbnb have built multibillion-dollar empires by operating in places where they are illegal, and so they are turning political to protect themselves.

Jesus. As you know, I’ve been basically supportive of the efforts to revamp Houston’s vehicle for hire ordinances. I believe the existing taxi industry does not adequately serve the whole city, I believe there is room for the market to grow with the new services, and I think Houston’s emerging image as a dynamic place to live would benefit from including the newcomers and would suffer from excluding them. But as I’ve also said, Uber in particular has done an amazingly effective job of alienating the people they should be courting, with their decision to go rogue and start operating as if they’d been approved even though they’re still not legal, thus putting their drivers and potentially their customers at risk while utterly disregarding the concerns of the existing players. I’ve marveled more than once at how a company with that much venture funding, and that much at stake because of it, could be so cavalier about the process that will ultimately determine whether or not they get to do business in a given city. I suppose this is one answer to those questions.

(Side note: While I have generally lumped Uber and Lyft together in these discussions, it strikes me that Uber has been by far the worse actor of the two. Lyft has also had drivers charging for rides, but they followed Uber’s lead, and overall my impression is simply that they’ve been less obnoxious, at least as far as I can see. Maybe there’s more going on that I haven’t seen, but this is how it looks to me.)

One has to wonder if Uber and its allies are self-aware enough to realize the potential for political consequences, in particular for undermining their own efforts. Campos made an interesting observation last week:

H-Town City Council takes next week off then comes back after the Fourth of July. I am thinking the next big issue before them is the vehicle-for-hire ordinance. Let me say again that I don’t have a dog in this hunt. That being said I’m thinking don’t put your money on the Uber and Lyft movements. First of all I think they have pi__ed off folks here in H-Town by operating illegally. Second of all I think they have been completely outflanked by the disabilities community. Uber and Lyft don’t have an answer to their concerns. Thirdly, their demographic isn’t a political force in our burg – they don’t vote. Fourthly, Uber and Lyft don’t have any roots in our community and that has to count for something – don’t you think? Stay tuned!

I’ve generally been of the opinion that Council would accommodate the newcomers, at least in some fashion, but I’ve also said that there isn’t much of an early indicator how the vote will go. What I do know is that if this turns into a partisan fight, the Republican side is outnumbered. Counting CM Costello, who isn’t much of an R these days but who is a self-proclaimed supporter of Uber and Lyft, there are seven Rs out of 17 votes on Council (Mayor Parker gets a vote, too), so at least two crossovers would be needed. That could certainly happen, but most other large cities are predominantly Democratic, and I don’t think having Grover Norquist and Marco Rubio as Uber’s champions will do them much good in those environs. But hey, they’re obviously so much smarter than the rest of us, so I’m sure they know what they’re doing.

Anti-tax zealots plump for casinos

Gambling yes!

Grover Norquist, the nation’s most prominent anti-tax crusader, wrote a letter last week to Texas legislators to call for expanded gambling.

“In light of the adverse economic impact that higher taxes would have, it is imperative that lawmakers consider all other options for balancing the state’s budget,” Norquist wrote. “There are a number of alternatives to raising taxes, the most preferable being an expansion of economic activity, and thus, the tax base. One way to do that would be to permit legitimate businesses to operate that are currently not allowed to do so. Research has found that permitting lawful and responsible gaming operations in Texas is one simple way to grow the Texas economy, thereby generating more tax revenue for the state.”

Representatives from groups that tried to pass gambling measures in the 2011 legislative session said they had nothing to do with the letter.

Gambling no!

The Texas Public Policy Foundation’s executive director, Arlene Wohlgemuth, and it director of fiscal policy, former state Rep. Talmadge Heflin, sought to counter a pro-gambling letter sent to state leaders last week from anti-tax crusader Grover Norquist, the president of Americans for Tax Reform.

[…]

“While we generally agree with our friends at ATR on tax and spending issues, when it comes to gambling, that is not the case. Their suggestion that gambling is a way ‘in which to rectify the anticipated budget imbalance’ is wrong,” Wohlgemuth and Heflin wrote.

The foundation’s preferred approach would lean more toward fiscal discipline as the state faces the likelihood of another budget shortfall ahead of the 2013 legislative session.

I’m generally agnostic to deeply ambivalent on the gambling question, but if those are my choices I say bring on the casinos and the racetrack slot machines. There are of course other choices, just not ones that these one-percenter chuckleheads are interested in. As we well know, we’ll need a better legislature for any other options to get traction.

Beyond that, I have no idea if any of this will make a difference or not. Neither argument is particularly original, so at this point it’s more a matter of which article of faith one subscribes to. The real question at this point is whether or not gambling will have a higher profile in 2013 than it did in 2011. My money’s on yes.