Consumer Über Alles – My No Holds Barred Over the Top Defense of Uber

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I’ve had it. Last month’s idiotic, asinine and utterly transparent-in-motive decision by the California Labor Board ruling against Uber has done it. I’ve got to speak up, and I should have last month.  I’ll get to the particulars in a moment but first…

The reason  there are companies like Uber, Lyft and the others is because of how bad “protected” industries are, and how badly they’ve historically treated their customers, in this case the taxi industry.

Bay citizen article

Reliable service. Great and friendly customer-first approach. Happy workers who you never feel like are taking advantage of you.  Has anyone in the history of the world ever said that about taxi industry?  Spoiler alert, no. Which is why ridership and people wanting to drive for Uber continues to soar… Yet, inexplicably there seems to be a fascination with and an undue credit given to those few who are doing every distorted thing they can against Uber (and by extension other ride sharing services). All too often (once might be too often) a compliant media and, worse, public officialdom goes along. Actually it’s not at all inexplicable, the establishment wants to protect a favored industry that’s being disrupted by a brash outsider. And since almost without exception the private sector is more nimble and smarter than the public sector, the government has to resort to the only advantage it has, brute force in implementing an unfair playing field.

If you’re like me and have used Uber, you probably love it.  You can be anywhere, needing to go to anywhere, and in a manner of minutes a nice car with a polite driver comes to get you. You’re able to track the progress of the car as it approaches you and then as you progress on your trip. You know what to expect to pay before you take your trip and what you are charged is fair. What an amazing concept, right? Apparently not to everyone.

Before Uber (and Lyft and others) if you lived in San Francisco, for example, in an area anywhere where taxis did not congregate, which is to say about 95% of The City, and you needed a taxi, you would have to call one of the taxi dispatchers and then… hope.  Hope they would come in a reasonable amount of time. Hell, hope they would come at all. Hope they wouldn’t rip you off.  It was an awful model, creating an awful industry that should have gone out of business long ago.  But they had a special weapon, a monopoly and government protection.

Cab complaints Climb in San Francisco

More than 1,700 passenger complaints include refused rides, declined credit cards and other rule violations

by Zusha Elinson

San Francisco taxi drivers routinely flout the law by refusing rides, declining to take credit cards, charging unauthorized fees, speeding, smoking, and talking and texting on cellphones while driving, according to a year’s worth of passenger complaints reviewed by The Bay Citizen.

Taxis infested with bed bugs, drivers falling asleep at the wheel, rude behavior and difficulty getting a cab also were among the complaints. One patron reported that a cab driver allegedly stole his credit card number and used it to make purchases in Brazil. And two friends were upset when a driver offered them a 10 percent discount if they made out in front of him.

The gripes represent longstanding dissatisfaction with the San Francisco taxi industry. Disgruntled passengers registered 1,733 complaints with the city’s 311 complaint line from July 1, 2011, to June 30, 2012, a 13 percent increase from the previous fiscal year. The number was almost double the 900-complaint goal of the San Francisco Municipal Transportation Agency, which regulates taxis.

You see in order to drive a taxi in San Francisco (as in most major cities) you had to own a special license, a medallion. There is a great write-up on Priceonomics by Rohin Dahar, who does a far better job than I ever could at explaining how ridiculous this system is. TL/DR, it’s a monopoly that only benefits a few including entrenched public officials, that creates an artificial scarcity of supply to drive up the cost to meet demand. The amazing thing is how bad it is for the actual drivers, as seen in this report by UCLA professors Gary Blassi and Jacqueline Leavitt, yet because they’ve made a very expensive bet on it, even though it’s a bad bet, the drivers double down.


forbes article


Given that monopoly, taxi drivers could – and often – cheat customers on fares… In other words stole from their customers. This is not some relic from the past; it happens today and is widespread as witnessed recently by appalling examples in in New York City and Las Vegas (and we could probably list every other American city). We need to call a spade a spade; any taxi driver who would take you on anything but the shortest, quickest route to get a higher fair is a thief. There never was anything charming about it. They’re petty criminals.

new york post article


So let’s talk about last month’s CLC decision.  The suit brought before them was by a truly repugnant person, the kind of person you would not want in your neighborhood, Barbara Ann Berwick.  From the New York Times:

(JIM WILSON – NYT - NYT, Pictured; Barbara Ann Berwick, former sex phone operator and unregistered financial adviser. She and her company have filed over 20 lawsuits)

(JIM WILSON – NYT – NYT, Pictured; Barbara Ann Berwick, former sex phone operator and unregistered financial adviser. She and her company have filed over 20 lawsuits)

Ms. Berwick has a history of being litigious. Since 1991, she and her company have filed at least 20 lawsuits in California. In one case, she sued an employee of a pizza parlor for $500 in damages for leaving restaurant menus on her gate. She was not awarded any damages.

She also ran a phone sex business and now claims to have transitioned that business to an online financial adviser – IRONY ALERT – who at the time of her Uber lawsuit was not registered as such by the Securities and Exchange Commission or the Financial Industry Regulatory Authority.

She claims that driving for Uber 60-80 hours a week, over the course two months she only made $11,000 while incurring $4,152.20 in expenses, including a traffic ticket, which she expects Uber to pay. First off, I don’t think $5500 / month is all that bad (even in San Francisco). But if it actually, which I most certainly do not believe, took her 60-80 hours a week for about two months to make that, she’s either an idiot or she’s acting duplicitously to advance a cause. It beggars all common sense to believe an intelligent and honest person would do that. And the nice thing about life is it has a way of weeding out idiots and catching liars.  The other point is she – and worse, the California Labor Commission – thinks she is owed for traffic violations she incurred while driving. To me she’s a civic degenerate.

I’m using harsh words for a reason.  Because people like Ms. Berwick are trying to assert influence affecting millions of good, hard working people, and are being accorded that opportunity by misguided and nefarious government agencies.  And in so doing they hurt people. This phenomenon is explained very well by Margaret Wente in a column in The Globe and Mail of Toronto.

The taxi industry is powerful. As Atlanta Mayor Kasim Reed said recently, “Cab drivers can take you out.” And the regulators are on their industry’s side. This is because of a phenomenon known as “regulatory capture,” which means that the regulated parties often make the rules by which they’re regulated. Regulators are also loath to give up their powers, which they usually think should be expanded. That explains the attitude of Tracey Cook, Toronto’s head of municipal licensing and standards. She argues that since Uber is really in the taxi business, and the city regulates the taxi business, the city should either regulate Uber or shut it down.

I’ve taken Uber more times than I can count. Every single time I talk with the driver and without exception they tell me how much they like the set up and how much they like making the extra money.  It works great for them.  Here’s an example.  Matt Palach, who is pictured above.  A recent Army vet, he served his country for 7 years.  He grew up in Minnesota and has moved to Phoenix to start a new life. Matt, who is 25, is going to college, is starting his own promotion business – Matt Palach Productions – and to help with that drives for Uber. He has a new car, is hard working… you could not ask for a better example of the American ideal than Matt.  But if government agencies like the California Labor Commission have their way, Matt can’t have that job. You know what, we should all be betting on Matt!!!

See that’s the fallacy of opportunistic politicians who claim that somehow Uber is hurting workers by creating low paying jobs, or as Mr. Reich says, “scraps.”  If not for Uber these jobs – which are not low paying – wouldn’t exist at all. These people would be locked out of the opportunity to make extra money because the power wants to protect their industry and support base. Uber is creating more and better jobs. And for some reason that scares the hell out of some politicians. and the special interests who fund them.

The good news for Uber is the market and more importantly the people are speaking. And they’re doing it with their actions.  Like in Phoenix, which has tried to lock out Uber from picking up passengers at Sky Harbor airport. As I said above, people are smarter, more agile and more nimble than government overlords. So what do they do?  They simple walk to where they’re outside the “lockout” parameters or take a shuttle to an airport hotel where they can be picked up by Uber.  It may seem silly as it takes a little longer and is more effort, but this is regular people telling the entrenched industry and the government to basically bud out.  And should I be force to take a taxi from an airport, there will be exactly zero tip.  I’m probably the biggest over-tipper around, but I am not going to reward anti-competitive behavior.  And that driver better take me on the absolute more direct route, or I’ll be filing a complaint.

My advice to Uber… You know you are being held to a different standard than the people who are trying to bring you down, so anything you do wrong will be amplified. This happens all the time so don’t let it stop you. Don’t be afraid to smartly make your case. Don’t be afraid to go after and call out the nonsense of people who are trying to destroy you. Be aggressive without being a jerk. We live in a different world where you can talk right to the public and in fact have the public be your ambassadors.  That terrifies the entrenched oligarchy.

As I see it, we have a choice. We make laws and policy based on what’s best for society and for the people government is supposed to serve. We help the Matt Palachs of the world.  Or we make laws and public policy that protect the entrenched special interests who have never cared about the needs of the public and we in essence let the Ms. Berwicks of the world decide our fate.

I know what choice I’m making… and I’ll make it with my voice, my wallet and my ballot. What about you?

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