Uber IPO is a moral stain on Silicon Valley
In 2010, I received an email from an ecstatic employee at a startup called UberCab. “What our tiny company is doing for San Francisco right now is huge,” he told me. The employee’s joy was contagious. Back then, as a naive, baby tech pundit, I was prone to spinning out elaborate visions of tech-abetted progress, and the more I learned about UberCab’s bold idea, the more deeply I swooned.
Car ownership is a financial and environmental blight. Cars are one of the most expensive products we buy, but they barely get any use (most cars spend most of the day parked). UberCab – which shortened its name to Uber – was using technology to push a radical new urban vision, and it quickly became a poster child for Silicon Valley’s messianic vision. Allowing strangers to share their cars sounded crazy, but if it took off, Uber might reduce the need for car ownership and increase the utilization of each car. It could make transportation cheaper and far more environmentally friendly, and it might create sustainable jobs for many drivers.
Dumbly, I once bought into this vision. Here was a company that could credibly claim to be changing the world.
Boy, was I a dope. Nearly a decade later, as Uber begins pitching its business to Wall Street in advance of an initial public offering that could value the company at $100 billion, I’m sickened and saddened by my naiveté.
In the years since, Uber skirted laws and cut corners to trample over regulators and competitors. It accelerated the startup industry’s misogynistic and reckless hustle culture. And it pushed a frightening new picture of labor – one in which everyone is a contractor, toiling without protection.
Uber – and to a lesser extent, its competitor Lyft – has indeed turned out to be a poster child for Silicon Valley’s messianic vision, but not in a way that should make anyone in this industry proud. Uber’s is likely to be the biggest tech IPO since Facebook’s. It will turn a handful of people into millionaires and billionaires. But the gains for everyone else – for drivers, for the environment, for the world – remain in doubt.
Today’s Uber is more responsible than yesterday’s: Travis Kalanick was ousted as chief executive in 2017, and Dara Khosrowshahi, its new chief, has led a thorough rehabilitation. Tech giants – including Apple, Google and Jeff Bezos, who all acquired significant stakes in Uber – will make a killing. Saudi Arabian petromonarchs will too.
Not Uber’s drivers. Recent studies show that Uber drivers make poverty wages – about $10 an hour after their vehicle expenses are deducted from their pay. Drivers’ fortunes might only worsen after the company goes public. Uber lost nearly $2 billion in 2018, and the best long-term hope for Uber’s business is that drivers disappear altogether, replaced by cars that drive themselves.
The environmental gains have also yet to materialize. Though ridesharing has prompted some people to go carfree, vehicle ownership has gone up in cities where Uber and Lyft are popular. Car services might also be prompting wealthier people to ditch public transit, thus reducing political support for it.
Soon a few new billionaires will roam the earth. All will be forgotten and forgiven – and Silicon Valley will move on to the next big idea to be squandered.