Predatory tech players are latest enemies of public good

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Mobile phone showing Uber logo. Image: Automobile Italia/Flickr

It's necessary from time to time to update the enemies list. In the case of Toronto politics, it once consisted mainly of crass developers who lounged around city hall and reeled in passing councillors.

Enemies are harder to identify when they come in casual, tech-ish garb, like Google and Uber. Google initially dazzled local politicians with Sidewalk Labs, for example. But gradually the Big Tech lustre dimmed (now even Facebook's Mark Zuckerberg has to meet with U.S. President Donald Trump furtively) and by the time Sidewalk made its land grab move last winter -- as if they'd been mere developers in disguise -- opposition had developed and they got stalled. For now.

But say this for Google. They may be pirates who invade your privacy and crush competition but they've at least done some innovating, like their search engine, and have paid their way as they rape and pillage. (Aside from the fact that both computers and the internet were 100 per cent U.S. government creations.)

Not so Uber. It, too, initially experienced success by persuading the city in 2016 to cancel training for taxi drivers rather than impose it on Uber drivers. Then came the nightmarish death on the Gardiner Expressway of Uber rider Nicholas Cameron and council reimposed some safety standards. But Uber continues getting away with mayhem, based largely on self-spun myths, with few to no offsets.

I learned much about it from an interminable series of articles called "Can Uber Ever Deliver?" by an obsessive transportation expert named Hubert Horan. (Obsessives are great at business exposés. Elizabeth Warren has been fruitfully obsessed with bankruptcy throughout her career.)

Myth one? Its success is based on its brilliant platform.

But Horan says the platform doesn't produce profit and only does what everyone does: move riders from point to point.

Then what accounts for those cheap fares? Not the tech. They come from huge ongoing capital infusions, which allow Uber to undercut the competition. In short, they're "predatory subsidies" that cover over 50 per cent of your ride! If that doesn't suffice, they underpay their drivers and then underpay them some more.

So why do investors subsidize it? It's the strategy: destroy rivals -- taxis and public transit -- and when they're gone, jack up the fares wildly. Meantime the owners profit from shifts in its stock value, even if they never meet forecasts.

What about horror stories on abuse by its former CEO and sexual assaults by drivers, a "culture" its new CEO vows to alter? Horan says they're no aberration. It fits a ruthless, predatory mindset: to wreck competition and succeed at all costs. But it's another tale distracting attention from that deliberate, unprofitable script.

God forbid their strategy ever succeeds. Drivers will be fired to create the scarcity to justify price hikes -- just as they were hired in excess to provide the availability supposedly produced by the platform. Streets will be left needing repairs due to increased traffic (people rarely ditch their cars even if they use Uber) and there are horrendous climate impacts. And those disposable drivers? Most are full time; not the footloose, creative types portrayed in Uber ads.

Along the way, public transit will become a shell, mainly for those who can't afford smart phones or internet access (more than you'd think).

People from my demo (leftish, older) sometimes eschew Uber to show solidarity with stressed out, often unionized taxi drivers. It seems mainly symbolic. Like boycotting products, it makes you feel better even as you sense it's futile. In Uber's case though, more than political exhibitionism is at stake: a healthy economy, traversal cities, climate devastation.

Yet what's really bugging Horan, may be less the actual evil done by forces like Uber than having to listen to their b.s. about how creative and inevitable they are. That's probably been true of technology grumps since the Luddites.

Speaking of hypocrisy, I want to congratulate Mayor John Tory for his recent exercise in inconsistency, reversing course to back higher property taxes meant to fund housing and transit. I mean it. And yes, I will feel the bite.

But, it's not enough to support the right stuff, you also must be clear about who's trying to subtly undermine it, even as they ardently spout about how progressive they are.

Rick Salutin writes about current affairs and politics. This column was first published in the Toronto Star.

Image: Automobile Italia/Flickr

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