Rule-Making as Structural Violence: From a Taxi to Uber Economy in San Francisco

Veena Dubal 

Between 2012 and 2014, California regulators made critical decisions that ultimately restructured political economies of mobility around the world. In municipal and then state regulatory bodies, policy-makers refused to enforce existing taxi laws and regulations against so-called “ridesharing” services, including industry leader UberX, as well as Lyft, and Sidecar. Regulators determined that the companies were not taxis but “transportation network companies” (“TNCs”), and created new rules to govern them. These California rules were the first of their kind anywhere in the world. The regulations and logics that they engendered were subsequently replicated nationally and internationally. The global regulatory response devastated worker livelihoods and transformed what had been a low-paid full time job to even lower-paid part time gigs.

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How did workers make sense of rapid change in their industry? What were their reactions when regulators refused to enforce existing taxi rules and to the rulemaking that ultimately devastated their livelihoods? And what can their narratives, experiences, and understandings tell us about the political economy of law amidst innovation?

Taxi workers in my ethnographic research challenged two fundamental aspects of the prevailing popular and academic narratives of “uberization” as a neoliberal political and economic re-ordering. First, workers argued that this legal transition and the social and political norms it propagated were embedded neither in technology nor in techno-utopian imaginaries. Instead, in making sense of their own precarity, taxi workers placed blame on the structural power of private actors and the instrumental power of regulators. Second, in telling the tale of how law and power worked together to facilitate the demise of their tenuously secure work, drivers were emphatic that this was not a story of deregulation or state withdrawal. Contrary to some traditional academic accounts, taxi workers argued that both the rule-making process and the rules themselves created and valorized a market in which the state had a strong, active, and even authoritarian hand.

Now a global phenomenon, Uber began as UberCab in San Francisco in 2010. Less than two years later, Lyft and Sidecar launched a different model: non-professional private drivers using their own cars and a suggested, non-mandatory price for the ride. Uber adopted this new model as UberX but with a mandatory fee set by the company. Shortly thereafter, the United Taxicab Workers—a twenty-five year old, worker-led taxi driver advocacy organization—alerted city officials to the growing number of unlicensed taxis competing for their work and roving the streets of San Francisco. They lobbied the city to enforce taxi regulations against the companies.

Mark, a UTW leader and long-time taxi driver, was frustrated at the city’s inaction. He told me in late 2012,

These are worse than illegal limos. They don’t even have licenses! People are using their own cars. Non-professional drivers. They are running afoul of every taxi regulation. They claim they’re innovative and new, but we already have this technology! This is what Cabulous [a taxi app] is. We’ve been using this for the past few years. This isn’t about technology. This is just a new exploitative business model—one step removed from the leasing model that the taxi companies have been using for years. They’re just bandit cabs. We’ve been pushing the MTA to issue another cease and desist but they won’t. They won’t enforce their own regulations. (my italics)

Mark argued that the Uber business model was not about technological innovation—but about the innovation of capital. He, like many other taxi drivers, emphasized that the technology itself pre-existed Uber. He understood Uber as an exploitative evolution from the precarious leasing model introduced in the San Francisco taxi industry in the late 1970s. Unlike taxi drivers who had to pay taxi companies for the lease and gas before they could venture out onto the road, Uber drivers also had to bear the costs of their vehicle maintenance and hybrid liability insurance (which did not exist until 2016). To make matters worse, the companies were operating without vehicle caps or fare regulations—the two key regulations that taxi workers had long used to maintain some semblance of wage stability.

Ruach—who, like Mark, had been driving in San Francisco since the late 1970s—argued that Uber’s innovation was to centralize dispatch, which UTW advocates had been pushing for years.

The media keeps selling this as innovative technology. This is not innovative or about technology. We have been trying to get the Board of Supervisors to pass an ordinance to mandate centralized dispatch for years. They won’t do it. The dispatch companies and the cab companies push back. And now, all of a sudden, these tech companies come in and everyone’s excited about centralized dispatch. HELLO! Have you been listening [to us] all these years? That’s all these companies are. (my italics)

When I asked worker advocates why they thought the city was unwilling to use their regulatory powers to stop these companies, especially since the SFMTA had just commodified and sold 900 medallions two years earlier, they blamed it on the structural power of capital.   Barry, another driver and advocate, described Uber’s massive lobbying efforts as “graft.” Although in most cases, the lobbying was technically not illegal, he understood it to be steeped in anti-democratic, corrupt practices. In a conversation we shared in 2013, he explained,

Ron Conway was an early funder of Mayor Ed Lee, and he is also an investor in Lyft and Uber. There are rumors [former] Mayor Willie Brown is getting his pockets lined as well. This is just graft. They are using the language of the tech economy. But they know that’s not what this is about. These are just taxi companies but with Wall Street money. Infinite amounts of money. We thought they [the taxi companies] were corrupt. (my italics)

In 2013, a rule-making process that began in late 2012, the California Public Utility Commission decided two critical things. As a matter of law, Uber offered pre-arranged rides and therefore, under the California Constitution, was to be regulated not by (more progressive) municipalities but exclusively by the state. And second, in the explicit name of “innovation,” the agency was to create a new regulatory category—Transportation Network Companies—and regulate them differently than limos and taxis—without car licenses, vehicle caps, or fare regulation.

Drivers like Mark, Ruach, and Barry directly related the structural power of venture capital to this regulatory outcome. They often felt their advocacy was misunderstood; they did not oppose technology. In fact, they laid claim to the technology themselves. But they protested the specific role of law, and in Barry’s words, the “greed and graft” through which those laws were achieved, in compelling the demise of their industry and livelihoods. They acknowledged that by producing two regulatory regimes, officials had eased the burden on TNCs at their expense. But they framed the character of the state as heavy-handed, not as laissez faire. This was not government facilitating a “free market” through deregulation, but preventing competition by maintaining fares at below market rates, and creating an overall unequal playing field.

Today, workers’ wages across the Uber-taxi divide are roughly 65% of what they were in 2010. They are often below the minimum wage. Told through the eyes of workers, the case study of how regulators responded to rule-breaking platforms and created the city’s contemporary Uber economy can neither be explained through innovation fanaticism nor fundamentally through a politics of efficiency and deregulation. Taxi workers understood innovation discourse as obscuring both their everyday hardships and corruptive, though legal, state practices. And they reframed the law in this process as playing an active role in undermining democratic principles, producing the myth of a free market, and exacerbating political and economic inequalities. As Mark wrote to me in a text following the fifth recent suicide of a taxi driver, “The invisible hand has shown its hand.”

Veena Dubal is Associate Professor of Law at U.C. Hastings College of the Law, San Francisco. 

Visit our Political Economy of Technology page to read all the posts in this series.

Capitalism, Inequality, and Human Rights

Paul O’Connell —

moyn postSamuel Moyn’s new book begins, with an echo of Christopher Hill, by noting that history has to be revised and rewritten to meet the demands of the present. From this, Moyn sets out to provide us with a historical account of the relationship between human rights and inequality, in order to shed some light on the major crises and challenges facing the world today (Trump, staggering inequality and more). On this he delivers admirably: Not Enough is a sweeping, erudite account of the place of human rights in debates about equality from the pioneering days of the Jacobin state in revolutionary France, through the mid-twentieth century welfare state, and the grand decolonial visions of the New International Economic Order (NIEO).

While it is impossible to do justice to the breadth and nuance of the work in this brief post, the crux of Moyn’s argument is that when modern notions of human rights, with a particular focus on social rights (or depending on where you are from, socio-economic rights), came centre stage, it was as a poor second prize following the decline and failure of grander narratives of material equality and social justice. For Moyn, human rights emerge and prosper in tandem with the entrenchment of neoliberalism on a global scale, and while the latter has produced dramatic social transformations and spiralling inequality, human rights have remained “powerless companions” to effect any meaningful change in this period. One consequence of this analysis, captured in Moyn’s recent Op-Ed in the New York Times, is that the human rights movement runs the real risk of falling victim to rising populism and dissatisfaction with the status quo, because it has “made itself at home in a plutocratic world”.

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Law and Neoliberalism in Keilee Fant v. City of Ferguson, Missouri

Teaching Law and Political Economy through Keilee Fant v. City of Ferguson, Missouri Part II

Angela Harris – 

In my first post on Fant v. Ferguson, I introduced the case as a story about our racialized criminal justice system. The criminal justice story, however, represents only one layer of the onion. Like its fast counterpart, the slow violence experienced by Keilee Fant is embedded in a larger system of structural economic inequality that we call “poverty.” Thomas Harvey, a co-founder of the St Louis public interest law firm ArchCity Defenders, which represented Keilee Fant in the case, has commented, “These aren’t violent criminals. These are people who make the same mistakes you or I do – speeding, not wearing a seatbelt, forgetting to get your car inspected on time. The difference is that they don’t have the money to pay the fines. Or they have kids, or jobs that don’t allow them to take time off for two or three court appearances. When you can’t pay the fines, you get fined for that, too. And when you can’t get to court, you get an arrest warrant.”

The world my students learn about in my first-year Criminal Law course contains references to the spectacles of violent black death we now associate with Ferguson, Missouri. But criminal law classes seldom touch on the mundane world represented in the Fant complaint. As criminal justice scholar Alexandra Natapoff notes, that there are really two criminal justice systems in America. There are about 1 million felony convictions in the United States every year. Meanwhile, there are about ten million misdemeanor convictions, and even more “infractions” – offenses, like traffic tickets, that are technically not crimes at all, and yet are tied to the criminal justice system through fines and fees. The felony system is a familiar, Law and Order world of grand juries, felony charges, and parties represented by counsel. The misdemeanor system produces many of the same bad collateral consequences for people who are convicted, including potential loss of state benefits, loss of employment and housing, loss of eligibility for professional licenses, family disruption, and possible deportation — but without the procedural protections available to felony defendants. Misdemeanants routinely lack access to legal representation. Their cases are handled en masse, not individually. Their claims are speedily dispensed with by plea deals that ignore questions of guilt or innocence. All the while, the individuals – black, brown, and “not quite white” – consigned by poverty to this legal underworld are treated with disdain by overworked prosecutors, judges, and defense counsel, who see them as congenitally dysfunctional “mopes.”

From this perspective, the misdemeanor criminal justice system is one element in a sprawling system of surveillance, punitive discipline, and control that makes the lives of poor people profoundly unfree. Poor people live their lives under the control of government programs that all too often start with the assumption that they are lazy, immoral, and in need of guidance and punishment. Our “welfare” system and our foster care system, for example, are built around the assumption that people receiving government assistance are likely to commit fraud. As sociologists like Kaaryn Gustafson have shown, welfare bureaucracies are so focused on punitive action that they incentivize the very fraud they punish. They are also institutionally invested in restructuring the family lives of poor people, whether the goal is to make them get married, stop them from having so many children, or keep them from having abortions – as Julie Nice and others have demonstrated.

Within this second frame, Fant v. Ferguson is a story about “neoliberalism” – an overused but still helpful word that calls attention to the shrinking social welfare state, the transmission of financial risk from government institutions to households, and the widely-held assumption that market governance is superior to democratic governance in nearly every sector of public life.

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The dark side of the ‘data-driven’

Frank Pasquale –

In her fascinating new book Automating Inequality, Virginia Eubanks recounts that the first “big data” set in the United States “was the Eugenics Records Office in Cold Spring Harbor. It was the public arm of the eugenics movement.” While the systematic collection of data has underpinned many important initiatives, it also has a dark side. Expect to see that dark side re-emerge with a vengeance in the next few years, as many American states intensify their surveillance of already disadvantaged groups.

Are there forms of knowledge that the state—or even university researchers—should not aspire to attain? Privacy law is meant to empower us with zones of thought and experience that no one can access without permission. Another branch of law, governing human subjects research, ensures that experimenters obtain consent before gathering data about individuals. As a member of the Council on Big Data, Ethics, and Society, I have thought and written about the types of data corporations and states should be able to gather about individuals, and the power relationships that data gathering entailed.benthams-panopticon-copy.jpg

Like disputes over free expression, the politics of data gathering for social science research is becoming a fraught area for progressives. For some, knowledge is an intrinsic good. Research of all stripes is a way of better understanding ourselves and our world. But there is another, more Foucauldian perspective: Where does the burden of scrutiny fall? What complicity does a social scientist have with the regime that provides data? The construction of what counts as “success” or “failure” in a given study is a highly political decision. A particular focus on some data or metrics comes at the cost of an exclusion or devaluation of others (akin to the “jurispathic” judgments Robert Cover recognized). All these questions will be critical as America’s laboratories (or meth labs) of democracy concoct innovative ways of denying health care to the poor, and ask social scientists to study “what works” in health policy.

Evaluating the Costs of Program Evaluation

The Trump Administration recently announced an intent to grant states permission to condition Medicaid benefits on work requirements (via Section 1115 of the Social Security Act). Former CMS Administrator Andy Slavitt immediately condemned the move. Activists were even more outraged. Journalists chronicled the many ways the work requirements were likely to worsen health outcomes, while burdening the vulnerable with paperwork and bureaucratic hurdles. New state “flexibility” will translate into cruel cutbacks for the disabled (who now may be denied transportation benefits).   Continue reading

The Crisis of Progressive Neoliberalism

Nancy Fraser –

How should we understand the crisis of the current moment? Is the election of President Trump a temporary aberration or does it reflect deeper political trends—both in the United States and elsewhere?

In a recently published essay in American Affairs, I argue that the defining features of Trump’s agenda did not come out of nowhere. What enabled his ascent was first, the rise, and then, the unraveling, of what I call progressive neoliberalism. Progressive neoliberalism tied a finance-centered political economy to a progressive politics of recognition. Grafting neoliberal economics onto mainstream liberal currents of apparently egalitarian social movements, such as feminism, anti-racism, multiculturalism, and LGBTQ rights, it forged a hegemonic bloc that dominated American politics for several decades. Beyond the United States, progressive-neoliberal formations governed many other liberal democracies through center-left parties that made similar deals with bankers and bondholders to gain or maintain power.

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Progressive neoliberalism’s main competitor was what I call reactionary neoliberalism, which tied an exclusionary politics of recognition to the same neoliberal political economy.While reactionary neoliberalism was defeated by progressive neoliberalism, it offered no alternative to the latter’s project of Goldman-Sachsifying the US economy. Absent any organized opposition on a national scale, progressive neoliberals from Bill Clinton to Barack Obama were free to promote policies that metastasized finance and gutted manufacturing.They eviscerated unions and drove down real wages, proliferated precarious service-sector jobs and promoted predatory debt to enable the purchase of cheap stuff produced elsewhere. The result was to dramatically worsen the life conditions of the bottom two-thirds of Americans, especially (but not only) in rustbelt, southern, and rural communities, even as soaring stock markets fattened not just the one percent but also the upper reaches of the professional-managerial class. In due course, many harmed by these policies came to reject not only neoliberal political economy, but also the more inclusive view of recognition they associated with it.

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Law & Neoliberalism

David Singh Grewal and Jedediah Purdy –

Neoliberalism is an indispensable term for making sense of the legal, political, and ideological conflicts of the moment, and also one of the most maligned. Liberals who feel criticized by it have insisted so often and so loudly on its uselessness that even those on the left who use it often seem compelled to apologize as they do so, to distance themselves from all its other uses and users. People thus use the term in the very conditions it should work to criticize: isolated, idiosyncratic, mutually mistrustful, and “entrepreneurial.”

The term matters because it names key strategies in one of the major conflicts of the time: the struggle between democratic claims on economic life, usually on behalf of the security and autonomy of workers and other “ordinary” people, and the claims of capital and management: for higher profit, greater capital mobility, the subjection of non-market practices to market logic (from childrearing to universities to the professions), and “freedom to manage” through “labor flexibility.” To use the term, in the early twenty-first century, is generally to acknowledge the lines of this conflict, and often to take sides. For this reason, it is often discomforting to anyone whose view of the social and legal worlds is fundamentally conciliatory – Make the pie bigger through overall efficiency! – or organized by a different division, such as good Democrats versus wicked Republicans, or responsible conservatives versus heedless liberals.

If you are looking to identify neoliberal forms of argument, look first for four overlapping kinds of claims. The first and simplest is an efficiency-based view, sometimes called (by its critics) “market fundamentalism,” holding that strong property rights and private contracting are the best means to increase overall welfare, and that law should promote these except when it intervenes to “correct market failures.” Second is a more explicitly moral line of argument (though of course promoting overall welfare is an intensely moral project) that property and markets best protect the freedom and dignity of individuals, so a market society is the most decent social order possible. The third line of argument adopts a tragic register to deny that democratic politics and public institutions can ever successfully discipline and shape economic life. This pessimistic position tends to serve as a backstop when it is clear that market arrangements are failing to deliver overall welfare – because of intermittent crises and runaway inequality, let us say. “That may be so,” the neoliberal argument now runs, “but the alternatives are always worse – corruption, abuse of power, utopian tyrannies.” The last line of argument is the subtlest, often implicit, and also often the most important: the exclusion of certain kinds of ideas and proposals from any place at the table. Continue reading