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Whither the Public Commons? Enter The Private Corporation

By - November 05, 2014

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(image) From time to time a piece reminds us that we are in a slow, poorly articulated struggle over what we hold as a public commons. That was the case with Vanity Fair’s Man and Uber Man, a profile of Uber’s Travis Kalanick by Kara Swisher. Swisher deftly captures Kalanick’s combative approach in prosecuting what he calls Uber’s “political campaign” to beat established regulated markets in transportation, a campaign he believes he must win “98 to 2″ – because the candidate is a product, not a politician. In short, Uber can’t afford to win by a simple majority – this is a winner takes all scenario.

This gives me pause, and I sense I’m not alone. On the one hand, we praise Uber for identifying a huge market encumbered by slow moving bureaucracy, and creating a service markedly better than its alternatives. That’s what I’ve called an “Information First” company.  On the other hand, we worry about what it means when something that was once held in public commons – the right to transportation – is increasingly pushed aside in favor of private alternatives. Messy as it may be, our public transportation system is egalitarian in its approach, non-profit at its core, and truly public – as in, bound to the public commons through government regulation.

Are we sure we want to outsource our commons to private companies? I think that’s the existential question we face as a society. I wrote about it three years ago in a post What Role Government? From it:

Over the past five or six decades, we’ve slowly but surely transitioned several core responsibilities of our common lives from government to the private sector. Some shifts are still in early stages, others are nearly complete. But I’m not sure that we have truly considered, as a society, the implications of this movement, which seem significant to me. I’m no political scientist, but the net net of all this seems to be that we’re trusting private corporations to do what, for a long, long time, we considered was work entrusted to the common good. In short, we’ve put a great deal of our public trust into a system that, for all the good it’s done (and it’s done quite a lot), is driven by one core motivation: the pursuit of profit.

The question of the role we wish government to play seems even more pressing given the advance of largely private services such as Uber. We are in the midst of a heated social conversation around the topic, and we see the edges of it when silly insta-startups pop up to privatize public space such as parking spots. In my longer piece, I identify a series of areas where we’ve outsourced formerly public “features” of our lives to private companies. The trend has only strengthened since, and I don’t expect it will flag anytime soon.

So perhaps instead of “What Role Government,” or “What Commons Do We Wish For,” the question we need to ask ourselves is this: What kind of a corporation do we want? If we are going to have corporations play a larger and larger role in what we formerly understood to be the public commons, we might want to we spend a few cycles asking ourselves what kinds of behaviors and values we want our companies to exhibit?

Come to think of it, that’s kind of why I started NewCo last year. It strikes me that we’re just starting to have a conversation about those corporate values. I laid out some of this in What makes a company a “NewCo”?, to wit:

Driven by capitalism’s central motive – profit – corporations have become one of the most powerful actors on the global stage. Besides government, no other institution in society has amassed as much wealth, power, and control as the corporation.

But at their core, corporations are just people. And over the past few decades, in parallel with the rise of the Internet, those people have begun a quiet revolution that has redefined what a “corporation” can be.

The global economy is transitioning from hierarchical models of command and control to more networked and flexible approaches. A new kind of organization – one that measures its success by more than profit – has emerged. We call these companies “NewCos.” As the networked, information-first economy has taken hold, NewCos are building innovative, purpose-driven new ways of doing business.

A NewCo views “work” as more than punching a clock or doing a job. The people behind these companies believe work can equate with passion, community, and a force for positive change.

 

It’s fascinating to watch the debate over Uber play out – is it a good actor, or a bad one? Is its CEO a driven role model or a bully? Or is it, perhaps, still figuring out what it really means to have the public trust? Once you’ve won that trust,  well, maybe that’s when the real work begins.

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10 thoughts on “Whither the Public Commons? Enter The Private Corporation

  1. Andy Price says:

    I’m generally in total agreement with you but this piece baffles me. I see the cab industry as a great example of why we NEED privatization of everything. Cabs are a terrible experience because they have the safety net of regulation, which really just means the competition is limited–so the quality is awful. We all have plenty of cab horror stories. Now Uber has transformed the way we get around. Simply put, it’s superior. And if at the end of its life we get nothing more than an overhaul of the regulated transportation system whereby getting around is as simple as running an app, well then we are all better off for sure! But let’s be very honest about something here: left to its own devices, devoid of threats of competition, government itself will never innovate and will only get more tired and more inefficient with the passage of time. Same is true of utilities like cable and power. What would Comcast be doing without Netflix? What would solar be if not for the hateful PG&E?

    We need Uber, and we don’t need regulation, is my point. We need competition and free markets and while wild and adventurous and at times downright dangerous, they almost always lead us to a better place than we were before.

  2. Hey Andy. It’s not just cabs (it’s also bus/trolley, et al), and as I said, I praise Uber for what it’s pulled off. It’s superior, as you say, but it’s not bound to pick up anyone, regardless of income, access to tech, etc. It’s not regulated – and I agree, regulations foster terrible outcomes, but then again, lack of regulations can do the same.
    I think your point about government left to its own devices never innovating might well be said of monopolists or oligarchies, IE, winners who took all, which is what Uber is trying to do.

  3. Sean Cafferky says:

    It’s an important question to be asking, given how much Uber is held up in the limelight as a company we’re all supposed to admire and mimic. But is it?

    * They are seeking to be the very monopoly they deride. And are proud of it.

    * They engage in subterfuge and/or illegal activities against competitor taxis like Lyft.

    * They have shown utter disregard for any and every government around the globe. They simply ignore all laws designed to insure safety for the public and setup shop in total defiance of the law. Can you imagine a restaurant that flaunted food safety just because it thought it shouldn’t have to abide by the law? That’s insanity.

    * They routinely make grandiose claims about how much good they are doing, but subsequent journalism invariably disproves those claims again and again. For example, they claimed to pay 90K salaries for drivers, but investigations proved that was nowhere near the truth. I don’t want to list all 19 other examples, but there are many Uber PR lies which have been debunked by investigative journalists. It’s a very real pattern of false claims.

    * The CEO has repeatedly shown himself to be a belligerent bro. Not exactly a role model for entrepreneurs, particularly young Silicon Valley men above all others, we want to foster in this country.

    * Ridiculous surge pricing without transparency. We’re simply asked to believe that they “know” when prices need to raise and by how much. In the wake of a huge public outcry against the practice, Uber wrote off this customer feedback. Only recently have they seemed to temper

    * Uber is pushing dangerous subprime loans to drivers, essentially preying on people who may effectively become indentured servants and/or cause another ripple of credit problems. Meanwhile, they pretend this is somehow a good thing. The details matter, however.

    We could split hairs and I could offer additional detailed evidence, but I gather you’re aware of most of these issues or could easily find them by searching online.

    I think the conclusion is very clear: Uber is not a good player. We should not be celebrating them.

  4. Ken Hittel says:

    Seems silly to have to mention, for the umpteen-billionth time, this little thing called the Internet — a government initiative “left to its own devices” par excellence, i think?

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