Weather you drive or use UBER you should know that your getting a good deal at the expense of drivers who get abused by UBER. If it sounds too good to be true it probably is. UBER is taking advantage of a soft economy and the need for people to supplement their income. Even The City of Chicago announced today a living wage for it's employees and contractors. Companies like UBER come into the state of Illinois and steal fares from cab and limo drivers by the use of unfair pricing practices. Uber is able to modify their pricing at will without regulation of any sort and even offer and take the independent contractor (Driver/ Partners) money from their pockets without advanced warning or regard to how it effects the drivers needs. Over the past couple of weeks UBER has spent quite a bit on advertisement and trying to position their image as a generous employer who compensates their drivers with twice the minimum wage. As I stated in previous blogs this is far from the truth, the number UBER uses to make the claim doesn't take into account their imposed fees, commissions, car maintenance, insurance, gasoline, the cost of the vehicle and last but not least the drivers time.
Uber taking cabbies for a ride
Uber is the German word for, 'Stick em up, cabbies'
Chicago Tribune Story
June 20, 2014|By Ron Grossman
Taxi drivers gather next to the Olympic Stadium in Berlin on June 11 to protest ride-sharing apps. (Sean Gallup, Getty Images)
If
you're confused by the battle between Uber and traditional cabbies,
consider this: Machine Gun Kelly didn't legitimize bank robbing by using
cutting-edge technology to persuade bank tellers to hand over the till.
Before Kelly's innovation, bank robbers brandished pistols. But George Kelly favored a Thompson submachine gun, which gave him a nickname and a measure of immortality in Hollywood gangster movies. Still, his 1930s string of heists in Minnesota, Iowa and Washington didn't invalidate the biblical commandment: "Thou shalt not steal."
Before Kelly's innovation, bank robbers brandished pistols. But George Kelly favored a Thompson submachine gun, which gave him a nickname and a measure of immortality in Hollywood gangster movies. Still, his 1930s string of heists in Minnesota, Iowa and Washington didn't invalidate the biblical commandment: "Thou shalt not steal."
Yet
Uber has come out of nowhere to establish a global presence with a
business model based on flouting the rules of the heavily regulated taxi
industry. By way of explaining itself, Uber invokes the magic word, the
veritable abracadabra of the 21st century, "app." Its website
proclaims: "Uber is evolving the way the world moves. By seamlessly
connecting riders to drivers through our apps, we make cities more
accessible." Tap that app on your smart phone, and a driver and car will
speedily be sent your way.
As one electronic marvel has followed another, we've become mesmerized by a seductive but false assumption: Because wonders once scarcely dreamed of now lie at our fingertips, it seems legit to do anything that can be programmed into a computer or built into a smartphone. That ethical fallacy underlay the wave of "file-sharing" of pop music that robbed performers of royalties and put retailers out of business. Some Internet vendors are fighting a rear-guard action against charging sales tax. Because their orders arrive on electron wings, vendors think they shouldn't have to collect the tax paid by customers in a bricks-and-mortar store.
For its part, Uber justifies playing fast and loose by claiming consumers will benefit from its competition with traditional cab companies, and some heavy bets have been wagered on its winning the race.
Uber recently announced that, having raised an additional $1.2 billion in funding, its total valuation had reached $18.2 billion, and shows no signs of having topped out. Huge as those numbers are, they are not the only remarkable thing about Uber's appeal to investors.
If you or I seek a loan to buy a car or a home, the lender wants to make sure it will get its money back — even if our plans don't work out. That's why it retains a legal hold on the title to the vehicle or house until the loan is repaid. If we go belly up, the lender can recoup its investment by selling the collateral. The same scenario holds if we go to a pawnshop for a few bucks to tide us over until payday. We have to leave something with the pawner. Those guitars and jewelry in the shop window were pledged as collateral for loans that didn't get repaid.
Now if, say, Yellow Cab or Flash Cab asked investors for the kind of money Uber has gotten, it's easy to imagine what the collateral might have been. Cab companies have fleets of vehicles and garages. But when customers use Uber's app, they are dispatched a car whose driver owns and maintains it. So what physical assets does Uber have, besides smartphones and computers? Try hocking a cellphone or laptop. Pointing to shelves loaded with them, a shop owner will likely ask if you have anything else of value to pawn.
As one electronic marvel has followed another, we've become mesmerized by a seductive but false assumption: Because wonders once scarcely dreamed of now lie at our fingertips, it seems legit to do anything that can be programmed into a computer or built into a smartphone. That ethical fallacy underlay the wave of "file-sharing" of pop music that robbed performers of royalties and put retailers out of business. Some Internet vendors are fighting a rear-guard action against charging sales tax. Because their orders arrive on electron wings, vendors think they shouldn't have to collect the tax paid by customers in a bricks-and-mortar store.
For its part, Uber justifies playing fast and loose by claiming consumers will benefit from its competition with traditional cab companies, and some heavy bets have been wagered on its winning the race.
Uber recently announced that, having raised an additional $1.2 billion in funding, its total valuation had reached $18.2 billion, and shows no signs of having topped out. Huge as those numbers are, they are not the only remarkable thing about Uber's appeal to investors.
If you or I seek a loan to buy a car or a home, the lender wants to make sure it will get its money back — even if our plans don't work out. That's why it retains a legal hold on the title to the vehicle or house until the loan is repaid. If we go belly up, the lender can recoup its investment by selling the collateral. The same scenario holds if we go to a pawnshop for a few bucks to tide us over until payday. We have to leave something with the pawner. Those guitars and jewelry in the shop window were pledged as collateral for loans that didn't get repaid.
Now if, say, Yellow Cab or Flash Cab asked investors for the kind of money Uber has gotten, it's easy to imagine what the collateral might have been. Cab companies have fleets of vehicles and garages. But when customers use Uber's app, they are dispatched a car whose driver owns and maintains it. So what physical assets does Uber have, besides smartphones and computers? Try hocking a cellphone or laptop. Pointing to shelves loaded with them, a shop owner will likely ask if you have anything else of value to pawn.
A
week ago, an estimated 30,000 European taxi drivers, protesting Uber's
free pass from government regulations, snarled traffic from London to
Berlin. In Chicago, taxi companies filed a federal lawsuit demanding
that the city enforce its taxi regulations, instead of giving
app-dispatched drivers a pass. In San Francisco this week, dozens of
Uber drivers rallied at the company's headquarters, angered by Uber
chief Travis Kalanick's statement that driverless cars are the wave of
the future. Even now, the drivers said, they don't get a fair share of
the fares.
So what makes Uber's funders think that it holds the winning cards?
Their confidence may be sustained, in part, by what Chicago's City Council recently did, making them hopeful that other cities will follow. Instead of holding Uber to the rules, it changed the rules to meet Uber's needs. By creating a new category of "transportation network provider," it overrode an ordinance providing that if you want to operate a vehicle as a cab, it has to be licensed as a cab. The council's action also made explicit a handicap that cabbies were already carrying. Taxi fares are established by the city, while Uber and other "network providers" set their own fees, and can even instantaneously adjust them up or down, according to market fluctuations.
Cabs have to display a medallion, a transferable city license that can cost hundreds of thousands of dollars, plus a renewal fee. "Transportation providers" need only put a sign on their car identifying their network, and off they go. If, as its financial backers believe, Uber pulls ahead in its much touted competition for riders, the value of those taxi medallions will inexorably decline toward zilch.
When some Third World dictator threatens to nationalize a foreign-owned business, American entrepreneurs decry "expropriation," and demand compensation. Shouldn't they be similarly offended by Chicago ordaining a race in which one competitor plays with other people's money, and the other stands to lose a substantial investment if it loses a competition that didn't exist when it bought those medallions?
Is that equitable? To me, it seems more like what the Almighty had in mind when he laid down the law against stealing.
Ron Grossman is a Tribune writer and former history professor.
So what makes Uber's funders think that it holds the winning cards?
Their confidence may be sustained, in part, by what Chicago's City Council recently did, making them hopeful that other cities will follow. Instead of holding Uber to the rules, it changed the rules to meet Uber's needs. By creating a new category of "transportation network provider," it overrode an ordinance providing that if you want to operate a vehicle as a cab, it has to be licensed as a cab. The council's action also made explicit a handicap that cabbies were already carrying. Taxi fares are established by the city, while Uber and other "network providers" set their own fees, and can even instantaneously adjust them up or down, according to market fluctuations.
Cabs have to display a medallion, a transferable city license that can cost hundreds of thousands of dollars, plus a renewal fee. "Transportation providers" need only put a sign on their car identifying their network, and off they go. If, as its financial backers believe, Uber pulls ahead in its much touted competition for riders, the value of those taxi medallions will inexorably decline toward zilch.
When some Third World dictator threatens to nationalize a foreign-owned business, American entrepreneurs decry "expropriation," and demand compensation. Shouldn't they be similarly offended by Chicago ordaining a race in which one competitor plays with other people's money, and the other stands to lose a substantial investment if it loses a competition that didn't exist when it bought those medallions?
Is that equitable? To me, it seems more like what the Almighty had in mind when he laid down the law against stealing.
Ron Grossman is a Tribune writer and former history professor.
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