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Uber Lobbying and Political Attacks Disrupt Local Democracy, New Report Shows

Note: The report was updated on May 16, 2016. View the updated version.

May 4, 2016

Uber Lobbying and Political Attacks Disrupt Local Democracy, New Report Shows  

Study Documents Multibillion-Dollar Corporation’s Clashes With Local Governments in Austin, Boston, Chicago, New York, Philadelphia, San Francisco, Seattle and Washington, D.C.

WASHINGTON, D.C. – Uber Technologies, a San Francisco-based corporation valued at more than $50 billion, is using its vast wealth to overwhelm and undermine local government in cities across the U.S., a new Public Citizen report shows.

The report, “Disrupting Democracy: How Uber Deploys Corporate Power to Overwhelm and Undermine Local Government,” presents detailed case studies based on local news reports of conflicts between the corporation and local lawmakers and regulators in Austin, Texas; Boston, Mass.; Chicago, Ill.; New York, N.Y.; Philadelphia, Pa.; San Francisco, Calif.; Seattle, Wash. and Washington, D.C.

Because of a referendum campaign organized by Uber (and, to a lesser extent, Uber competitor Lyft), on Saturday, May 7, residents of Austin, Texas, will vote on whether to repeal a city ordinance requiring Uber drivers to get fingerprint background checks just as taxi drivers do.

In Austin, Uber helped fund a political action committee that had more than $8 million to spend on campaign activities such as airing television ads and sending political-style fliers to voters.

In each case examined in the report, Uber’s expansion is facilitated through the conversion of money power into political power. When city officials try to enact laws or enforce regulations the company opposes, it fights back by using political-style campaign tactics and large-scale lobbying.

“The campaign in Austin is not about innovation, safety or the free market,” said Alex Befort, who works in Public Citizen’s Austin office and has driven for Uber. “It is about corporate sovereignty over our local government and whether or not we can set regulations to protect the health and safety of our citizens.”

There is a pattern to Uber’s conflicts with cities. The company often launches in cities in conflict with local officials’ interpretations of local regulations, while at the same time insisting on the legality of its business. When local law enforcement and other officials respond, the company mobilizes a campaign to “save Uber.” Likewise, the company resists local legislative efforts that attempt to require the company to follow standards similar to those required of taxicab and limousine companies, framing them as attempts to “shut down” Uber. Because customers are required to provide an email address to access the company’s app, the company is uniquely poised to turn its customer base into grassroots lobbyists who will sign a “save Uber” petition when the company asks.

These petitions, which can generate tens of thousands of signatures, help legitimize the lobbying campaigns the company deploys. These campaigns often include high-powered lobbyists, including some who are former colleagues of the government officials they are lobbying. Uber usually wins these battles against rules and regulations the company opposes, but when it loses, it keeps fighting. When cities pass laws that Uber opposes, the company commonly seeks to have them pre-empted with Uber-approved state law or repealed through voter referenda.

“There is no doubt that Uber’s business appeals to many consumers and that taxi service is problematic in many cities,” said Rick Claypool, a Public Citizen research director and author of the report. “But that is not the point. The issue is whether Uber has the power to overwhelm local democracy. City governments should prioritize the interests of constituents, not the demands of an outside corporation.”

Read the full report.