Uber v. Taxi
One must die for the other to live
“It’s a good idea to keep a clean car and dress well,” the UberX instructional video explains. “Strong smells of any kind can make riders uncomfortable.” No doubt that’s true—which is why I kept putting off my on-the-road research for this piece: I’m a middle-aged drive-through aficionado with three messy children. My nine-year-old hatchback smells exactly as you’d expect.
I cleaned and detailed my car before activating my UberPartner smartphone app. I also went to the Shell station to buy a coconut-scented evergreen air freshener (and an extra-strength “black ice” specimen, to keep it company). Aromatic cardboard dangling from my rear-view mirror didn’t completely overpower the lingering scent of Burger King and long-lost Cheerios, but my car smelled better than it had since the Bush administration.
Like air fresheners, Uber services come in different flavours: “black” (limousines and town cars), “taxi” (conventional city-licensed cabs), “select” (stylish, sleek, and meant to impress), and UberX. The last one is the cheapest and by far the most popular, with fares as low as half that of traditional taxis. Any ordinary schlub with a licence, basic insurance, a decent car, and a clean criminal record can work for UberX. (The company also is rolling out a new service, UberPool, which will allow drivers to chauffeur two separate fares to nearby destinations.)
Drivers with UberX aren’t required to present themselves for formal interviews or even meet anyone from company headquarters. The registration process is online, earnings are automatically deposited, and instructions from HQ take the form of peppy, morale-boosting text blasts: “Thousands need a ride to the baseball game right now!” or “Tonight is the busiest night of the week!” My entire training regime consisted of watching a sixteen-minute web video.
Uber launched in 2012 and has since spread to sixty countries and more than 300 cities, including Edmonton, Quebec City, and Ottawa. In Toronto—its biggest Canadian market—the company claims it will create 15,000 flexible, self-directed, high-quality jobs; reduce drunk driving; and take half a million cars off the city’s congested roads. Its critics argue the company is a bald-faced scam that undercuts the traditional taxi system. A recent issue of Taxinews, a trade magazine, printed a column that decried Uber as a “corporate pariah,” a “malignant tumour,” and a “giant octopus” that has “spread its tentacles globally.” Vancouver and Calgary officials have shut down the ride-sharing service altogether; in other cities, including Montreal and Paris, it sits in a sort of limbo, with officials and drivers alike confused about Uber’s legal status.
When I finally got behind the UberX wheel, I felt less like a giant octopus and more like a social reject in my own car. Some drivers have a knack for chit-chat. But not me: Many of my rides went from start to finish in complete silence, with iPhone addicts not once making eye contact. Some passengers never bothered to remove their earphones—though none of that kept me from trying to create chemistry.
“Watching the hockey playoffs? ” I asked one of my first passengers, a young woman dressed in business attire, as we inched into downtown traffic. “I was pulling for Montreal—that’s my hometown—but you’ve got to hand it to Tampa Bay. They just wanted it more.”
She hummed in a way that seemed half-interested, so I pressed on by segueing smoothly into a discussion of local construction delays. When I started up with a monologue about the Pan Am Games, she interrupted: “Sorry, I gotta focus.” Moments later we stopped at a red light, and in the relative quiet I heard familiar pops and buzzes. She was playing Candy Crush.
Ten conversation-free minutes later, I dropped her off at a high-rise condo building, and she offered a brief, polite smile on her way out. Uber’s automated payment system makes the passing of paper or plastic between passenger and driver unnecessary, and there’s no tipping involved. So my most meaningful interaction with the woman—with all my passengers, really—took place after we’d parted ways. That’s when the two of us rated each other on a scale of one-to-five stars.
At restaurants and hotels, this sort of after-the-fact evaluation is a discretionary afterthought. But Uber’s rating system lies at the heart of its business model. Passengers are urged to evaluate every trip: if a driver’s rating falls below the local standard (as the company unilaterally defines it), he or she can be expelled from the network. The same applies in reverse: drivers are urged to rate every passenger. I found this feature handy after a foul-mouthed couple got into my car one Monday evening and proceeded to drop two or three F-bombs per city block. Two f’ing stars for you, my dears.
Even if cities around the world shut down Uber through regulation and courtroom manoeuvring, there’s no question that many of its ride-sharing innovations will remain part of the landscape. The five-star rating system, in particular, presents a ruthlessly efficient solution to one of the fundamental problems that has long plagued the taxi industry, indeed retail in general—consumers’ difficulty in appraising publicly the integrity and competence of streetside service providers who populate the nooks and crannies of the economy. For almost two centuries, city cabs were big rolling question marks. Until getting in one, you had no idea whether your driver would subject you to speeding, rip-off routing, cellphone jabber, the reek of cigarettes and yesterday’s lunch. Customers don’t want to go back to that, and traditional taxi brokerages know it. Even as they fight Uber, they’re designing their own smartphone apps with Uber-like features.
Uber may be a tech-darling upstart, but the taxi industry is three decades older than Canada itself. In 1837, Thornton Blackburn, a runaway slave from Kentucky, built Toronto’s first taxi, a wooden red and yellow box drawn by a single horse. The city was a tiny place then, but Blackburn found plenty of business along the docks of Lake Ontario. Business grew, and in 1843 city councillors drafted a comprehensive law “to license and regulate the duties and charges on coaches, carriages, cabs, carts, and other vehicles.”
Many early provisions seem quaint now: Cabs required “two well-lighted lamps” after dark, “unless it be moonlight.” They were prohibited from carrying cargo on Sundays. A driver could not “wantonly snap or flourish his whip.” The basic legislative thrust, however, remains surprisingly recognizable. Like its modern equivalent, the 1843 law stipulated the rates that drivers could charge customers and listed the places where taxis could wait for fares—the direct equivalent of today’s taxi stand. (On Church Street, for instance, they could wait only on the east side, “with the horses’ heads towards King Street.”) Drivers had to be eighteen or older, and they had to register their taxis with the city (requirements that remain in place today). And “a suitable and proper” municipal employee, the forerunner of licensing and standards officers, enforced the rules. The pattern was similar elsewhere, including Montreal, which began regulating fares in the 1850s, and Winnipeg, which enacted its first taxi bylaw in 1881.
Change swept the trade in the late nineteenth century when telephones became, in effect, the original ride-sharing app. In the late 1870s, for example, a Winnipeg man named Dave Storey set up a five-cab stand at the corner of Portage and Main, and stayed connected with his customers through direct lines to the police station, the Queen’s Hotel, and the tony Manitoba Club. Three decades later, automobiles began pushing horse-drawn cabs off the roads. This transformation also had Uber-esque overtones: young drivers seemed better situated to adapt to the new technology than older veterans. In London, the situation was so bad that the Daily Mail started a relief fund in 1909 for out-of-work cabbies.
A primitive version of UberX avant la lettre also emerged. Car owners without taxi licences would drive popular routes and charge small fees to customers who flagged them down; in the 1930s, commuters could travel between downtown Vancouver and the West End for as little as three cents. As with today’s ride-sharing apps, these so-called jitneys (the word means nickel) bypassed regulators and tapped directly into curbside demand.
Yet even in their heyday, such ad hoc services could not upend the regulated model—in large part because taxi brokerages coalesced into vigilant oligopolies. As early as 1926, De Luxe Taxicabs in Toronto stitched together a fleet of 175 vehicles and seventy-five call stations. In Montreal, seven brokerages teamed up in 1922 to share a single switchboard, leading to the creation of the powerful Diamond Taxicab Association.
“The regulatory weapons these groups used to suppress the cut-rate cab and thus to end the taxi wars of the 1930s varied remarkably little from city to city,” Donald F. Davis wrote in Urban History Review. “Those who wished to constrain competition almost invariably sought a uniform fare; sealed, mandatory taximeters; tougher vehicle standards; restrictions on entry into the industry, either through a per capita quota or the requirement to prove the ‘convenience and necessity’ of additional service; minimum wage and maximum hour requirements for drivers; and compulsory personal liability insurance.” Canadians supported such measures, Davis notes. “Regulators proceeded on the assumption that Canadians still believed in the ancient credo that everything has its just price, it being as unethical to pay too little for a product or service as to demand too much for it.”
Life in a taxi has always been gruelling. Six or seven twelve-hour shifts per week is the norm. And since most cabbies have to fork over fixed amounts to car owners and brokerages, take-home pay on any given day is a crapshoot. Competition from Uber has made it harder just to break even. In Toronto, drivers have lost as much as a third of their business since 2012, when a municipal taxi plate could fetch up to $360,000. Today, that same licence might sell for $120,000 on Kijiji. If city council doesn’t act, medallions might soon be worthless—a disaster for independent cabbies and for investors who once saw taxis as nest eggs on wheels.
But for your average city dweller trying to catch a movie or get home from a bar, UberX beckons as the perfect substitute, with crowd-sourced quality control, infinitely elastic supply, quick response times, and prices that effectively are dictated by rock-bottom suppliers. Hundreds of thousands of Canadians use the service—logging half a million rides each month in Toronto alone. Among the leading evangelists of Uber-topianism are teched-up journalists such as Chris Selley, who raved in 2014 that the service “is absolutely, mind-bogglingly fantastic.”
“The cab companies will protect their precious monopoly ferociously,” he wrote in the National Post. “The only hope, I think, is immediate, massive Uber adoption. Make Uber a way of life before the politicians can take it away. As fond as your average modern urbanite might be of government and regulation in principle, he’s more fond, I think, of technological entrepreneurialism.”
Such comments reflect the idea that Uber is part of a larger, unstoppable trend in the world of retail commerce more generally. It’s been twenty years since the introduction of Amazon, sixteen years since Craigslist burst out of San Francisco, and eight years since Apple released the iPhone. The Internet is a 24-7 reverse auction for all life’s pleasures, from music to sex to your kid’s old bike. Why should urban transportation be any different?
Another, less celebrated societal trend is working against old-school taxis: wage stagnation. Municipal governments have long rationalized regulation of taxi fares as a means to ensure that drivers can support their families. As the Ottawa Journal put it in 1936, “No one has any right to expect a taxi ride . . . at a price that does not permit of decent wages and working conditions for those engaged in providing it.” But in recent years, the expectation that any low-skill job will pay the rent and put food on the table has gone the way of the buggy whip. More and more Canadians must stitch together part-time jobs, home businesses, and transfer payments to make ends meet. Despite the middling hourly wages that many amateur chauffeurs earn with UberX, the service represents a highly attractive, flexible complement to their main incomes. It allows them to focus on those times when demand is high and “surge pricing” is in effect—early mornings, afternoon rush hour, late at night on weekends. Or those times that fit in well with their shift work or their kids’ soccer practice. Uber has tens of thousands of UberX drivers in Canada; it estimates that six out of ten drivers work at least one other job. (Many of the others are licensed cabbies piggybacking on the app—to the chagrin of the brokerages whose brands are painted on their cars.)
“The existing regulations for taxis all are from the pre-web era,” Uber Canada general manager Ian Black told me in his open concept, Ping-Pong-equipped downtown Toronto office. “We need something new, a third category that licenses companies. We need strict rules on background checks, insurance, and whatever else governments think is appropriate—as opposed to the existing system, where drivers license themselves. We need a flexible system with a lighter regulatory touch. We need to ensure public safety but also allow an emerging industry to grow.”
So far, he seems to be winning the battle. In early June, hundreds of cab drivers protested Uber’s unregulated growth in Toronto by abandoning their cars and crippling the downtown core. Uber took full advantage of the situation, texting drivers, including me, “There is a large taxi strike taking place tomorrow during morning rush hour. Lack of taxis will cause UberX demand to skyrocket! This is a huge opportunity that you won’t want to miss!” When Uber can cash in on protests directed at its very existence, what hope does the legacy system have? And if the traditional cab goes extinct, will any of us miss it?
The answer is as much philosophical as it is economic, which is why I decided to take two weeks off work and go back to school.
There is a gritty romanticism that attends the cabbie—an idealized status as the city’s ultimate ear-on-the-ground resource. “The New York City cabdriver personifies the energy and zeal of the world’s greatest city,” the historian and former hacky Graham Russell Gao Hodges writes in Taxi! “It is hard to overestimate the psychic hold images of cabdrivers have on the American people. . . . Like truck drivers, cabdrivers are iconic figures who inherit the restless, rootless, and marginalized traditions of cowboys, loggers, and miners.”
You might add priests to that list. As one seasoned driver told me, “The back seat of a cab is something of a confessional booth. The passenger knows he’s never going to see you again. He’s not worried about you judging him. So he talks and talks and talks.” (He conceded that passengers talk a lot less these days, thanks to smartphones.)
Perhaps more than anything, the cab driver is seen as a human atlas, with an entire city map in his head. London cabbies famously are required to master the Knowledge, which comprises 20,000 landmarks, 25,000 streets, and 320 principal routes and their myriad variations based on daily traffic patterns. Aspirant “butter boys” spend years studying, often by cycling through the city with clipboards and crib notes.
Formal training in Canada, by contrast, takes between two days and four weeks. On the first day of Toronto’s three-week taxi-driver course, Ali Teymouri, a former driver himself, stepped me and my two dozen classmates through 232 principal streets: ninety-two north–south; eighty-four east–west; thirty-seven diagonal; and nineteen “complicated” thoroughfares, such as the Kingsway, Spadina, and St. Clair, that are broken up in the middle. Street names and locations need not be memorized, since maps and smartphones are permitted on the final exam, but Teymouri cautioned us that GPS sometimes can yield sub-optimal routes. Having lived in the city for seventeen years, I found the geography lesson fairly straightforward, and while I did not sit the final exam I like to think I would have been among the nine out of ten who pass.
Then again, I was not part of the core audience. Almost all my classmates were recent immigrants. (The only other white student also happened to be the only woman. The cab has long been a highly gendered workplace.) Indeed, much of the course material focused more on Western mores than driving skills per se: Drivers cannot turn away a sight-impaired passenger because of his or her guide dog. Cannot refuse a fare because of someone’s race or sexual orientation. Cannot kick two men out of the car if they hold hands or kiss. “Anything intimate a person can legally do on the street,” instructor Nooshin Vassef explained, “they can legally do in your cab.” She added, “Your own forms of cultural expression may interfere with the way you serve customers.” Canadians don’t like close talkers, for example, or people who avoid eye contact or gab about their personal lives.
Vassef then led a candid discussion of stereotypes, by calling out various demographics and having us shout the first words that sprang to mind. Jew? “Rich! Lawyer!” Jamaican? “Reggae music!” “Don’t be a Russell Peters,” she warned us, referring to the comedian. “He gets paid for his racist jokes. You don’t.”
Another instructor, the hilariously wry Goldman Chan, taught a section on professionalism and customer relations. “Drivers should shower or bathe regularly,” he said, “and dress like professional golfers.” He detailed the differences between deodorant and antiperspirant. When it came to conversation in the cab, Chan urged discretion: “Avoid politics and religion, unless you’re of the same faith as your customer.”
My sixteen minutes of online Uber training can be summed up in a single sentence: Give customers what they want, full stop. My sixteen days of taxi school, by contrast, can be summed up by the many provisions and sub-provisions of Toronto Municipal Code Chapter 545. A few random entries from my notes: If I fail to display the taxi Bill of Rights in my car, there’s a $300 fine. I must retain my operator logs for at least twelve months. I can’t trade rides for sex. If I am convicted of terrorism, I lose my licence for at least ten years. If I break any of the rules—140 pages’ worth of them—I might end up before the licensing tribunal, which sits every Thursday.
To spend one’s days studying the municipal code and one’s nights moonlighting as an UberX driver is to experience first-hand the ideological stakes of the twenty-first-century taxi wars. The industry as we know it is a classic creature of the modern regulatory state, in which customer-merchant relations are closely supervised by government inspectors; whether or not this dirigisme is permitted to succumb to the more primal law of online supply and demand has profound societal implications for a thousand other industries.
In taxi school and behind the UberX wheel, I kept coming back to what might be seen as an existential question: What exactly is the social function of a driver for hire? Uber would put the answer in arithmetic terms. Move the greatest number of customers from point A to point B, cheaply and safely. The only metrics that matter are dollars and stars. Municipal governments, on the other hand, want cabbies to earn a living while protecting and serving the “public interest” (the phrase appeared repeatedly in my course materials). And it is the safeguarding of the public interest that leads to the welter of regulations, and the army of enforcement officers, that govern a taxi driver’s life.
As my course notes attest, cities view the cab driver as a civic actor who brings seniors to the store and patiently helps them with their groceries. A trusted neighbour who picks up children from home and takes them to school. Someone who won’t drive away at night until his or her passenger is safely indoors. The public-interest mandate also includes attracting visitors. “Your product is your city,” one of our instructors said. “You’re an ambassador who can promote festivals, sports teams, museums, other attractions. You’re almost a living advertisement: Come to Toronto!”
Beyond tourism, licensed drivers are seen as mobile temporary social workers, because they are not supposed to discriminate against customers who look impoverished—even if they doubt their ability to pay. “You need to think about your conscience,” another instructor, Sandra Thomas, told us. “Imagine a scenario where it is freezing cold outside, and you have some troubled sixteen-year-old who needs to get home. Yes, there’s a possibility you might not get paid. That sort of thing happens. But when you see him walk in the door, you know he’s safe. You can go home and sleep soundly.” UberX drivers, on the other hand, have no public-interest mandate. They pick up only those with smartphones and available credit—and they are assisted in discriminating against shady characters through the five-star rating system.
Then there are disabled passengers, who don’t fare well at all with the Uber model of transportation. Indeed, nothing demonstrates the fundamental gulf between market-driven and civic-minded car services as much as the issue of accessibility. From a purely commercial point of view, passengers in wheelchairs represent a niche market. And unless compelled to by regulation or personal circumstance, most drivers are not going to invest the $60,000 needed to buy an accessible van.
For the most part, Uber pretends that the issue doesn’t even exist: In California, where a 2013 law requires ride-sharing services to report data about disabled passengers, the company has stonewalled the government. In July, a state judge recommended that Uber operations be suspended statewide and the company fined $7.3 million (US) for violating reporting requirements.
Granted, traditional taxis have not done a sterling job of serving disabled passengers. Edmonton, for instance, will license a fleet of just ninety-five accessible cabs. But things are changing. Toronto recently has begun phasing in a new general licence that will utterly transform the city’s taxi fleet by requiring fully accessible vehicles, such as modified Dodge Caravans and Toyota Siennas, with folding ramps. Taxi school stresses accessibility and safety: We watched a frightening video that shows what can happen to someone in a wheelchair if his or her safety belts aren’t properly adjusted. In our practice sessions, we wheeled one another around obstacles, along ramps, and over curbs. We put on blindfolds to simulate visual impairment, while others led us from door to taxi.
More broadly, our formal training emphasized the fact that elderly and disabled customers are autonomous human beings—not helpless cargo maybe or maybe not to pick up. When driving a passenger with a personal care worker, address your remarks to the passenger directly. When navigating stairs or snow, offer elderly passengers an outstretched forearm but don’t force assistance upon them. Ask before taking away someone’s independence.
New bylaws and municipal training have life-changing ramifications for legions of Canadians who previously did not enjoy the type of on-demand transportation most of us take for granted. Even when accessible public transportation is available, as with the Toronto Transit Commission’s Wheel-Trans program, riders need to plan their trips a day or more in advance. No spontaneous trips to the movie theatre or to that new restaurant.
“I used to have two options to get from home to my job or doctor’s appointment,” Stephen Trumper, a journalism instructor in Toronto who has long used a wheelchair, told me. “I could call Wheel-Trans, which is cheap—but even if I didn’t have to book in advance, the bus is constantly picking other people up and dropping them off. A twenty-minute trip might take an hour and a half. I could also call a private service, but that costs $45 one way—a $90 daily commute.”
The hip—and able-bodied—condo set may have fallen in love with what amounts to a cheap intra-downtown shuttle service, but Uber remains a zero-star performer when it comes to accessibility. I have yet to encounter an UberX driver with a wheelchair-ready vehicle, and when I tap the UberAccess button—which loads the network’s “accessible vehicle supply”—the only rides that pop up are licensed cabs doing double duty.
“The lack of accessible vehicles,” Trumper explained, “is one of the reasons that the unemployment rate for people with disabilities is so high—25 to 30 percent. A lot of us just can’t get to our jobs. So when a city says that it’s going to make its entire fleet accessible, wow, does that open up your world.” But opening that world requires government intervention to protect the public interest. Passengers can’t give ratings to cars they can’t enter in the first place.
Toronto unsuccessfully sought an injunction against Uber in November 2014, alleging that the company was operating what was, in effect, an unlicensed brokerage. Even then, mayor-elect John Tory was telling reporters the issue was too big to address through “old-fashioned methods like court cases.”
In his city hall office, Tory told me his attitude is actually more nuanced than the simple “pro-Uber” stance that has been imputed to him: “When I did radio, I used to go out with a microphone and sit in the front seat of a cab. I’d interview everyone who got in, and I’d interview the drivers themselves. I learned how hard it is for them to make a living.”
But Tory does not want to “wipe Uber off the map” either, in part because the traditional industry has grown complacent. “By and large, cab companies had their way,” he says, “and as with other monopolies, they lost sight of customers. I often tell the driver where I’m going, and he’s never heard of the place. That never happens in the world’s great cities. We also have a quality control problem in terms of cleanliness. In that sense, Uber has been a needed wake-up call.”
The mayor wants to create a “level playing field,” where ride sharing can go bumper to bumper with licensed taxis. But for that to work, “Uber can’t continue operating like it’s the Wild West, where you can have anyone you like driving a car around without any regulation whatsoever. That’s not in the public interest.”
From city hall, I visited Beck Taxi, Toronto’s largest brokerage, and met with Kristine Hubbard, a leader of the local anti-Uber brigade. She invited several of her drivers to join us: Joel Barr, a white owner-driver and thirty-five-year veteran; Emmanuel Quaye, a Ghanaian emigrant who has driven a taxi for two decades and has sent three kids to university; and Amir Sepasi-Ashtiani, a forty-eight-year-old, originally from Iraq, who owns his cab. I asked them all the same question: Can the traditional industry coexist with Uber, even in a semi-regulated form? The answer was a resounding no.
“If cities don’t ban UberX, then drivers will have no incentive to go to cab school,” Quaye said. “There’ll be no CPR training, no refresher courses for older drivers. The municipal licensing officers will lose their jobs. Cities will lose money, because UberX guys don’t pay HST. Thousands of people will cheat on their taxes.”
“Drivers don’t have the insurance,” Sepasi-Ashtiani added. “I pay $9,000 a year. The guy driving UberX might pay $1,200. He’s using his private car as a commercial vehicle.”
“It’s all for what? ” Barr asked. “For a business that sends all its profits to California.”
Like my course instructors, Hubbard and her drivers all circled back to the cabbie’s role as a civic actor. “When I’m picking up someone from an assisted-living facility, it might take me five or ten minutes just to get their wheelchair into my car,” Sepasi-Ashtiani said. “Then it’s another five or ten minutes to get them out. The whole trip might take half an hour, all for maybe $10. The city said I had to go out and get an accessible car, so I did. The UberX guy just cherry-picks rides from teenagers and young people in whatever car he wants. How can that ever be fair? ”
The question of fairness is one I now ask myself every time I pass a taxi. Look inside, and you will notice that the passengers skew older and frailer—and not just because many older people don’t have data plans. Cabbies have long relied on the promise that, at the end of the day, the good fares will balance out the bad. With the regulated taxi industry increasingly dependent on the old and the feeble—while UberX skims the easy-fare cream—it’s only a matter of time until it goes bust.
On June 1, lawyers for Uber and the City of Toronto appeared before Ontario Superior Court. Nominally, the hearing revolved around the narrow question of whether the company has violated Municipal Code Chapter 545 by operating an unlicensed brokerage. But Justice Sean Dunphy quickly cut to the chase. The real alleged culprits here, he said, are UberX drivers. Because the city doesn’t have the means or the gumption to go after the small fry, it has decided to go “after the godfather.”
“Is the court the right place to get political courage to change bylaws? ” he asked Toronto’s lawyers. “It’s not my job to help you. . . . It is not for the court to amend the municipal code.” A month later, in dismissing the legal case against Uber, he struck the same chord, declaring, “Questions of what policy choices the city should make or how the regulatory environment ought to respond to mobile communications technology changes are political ones.”
He’s right—and the stakes are high. Mayor John Tory and Uber’s Ian Black may argue that ride sharing and traditional taxis can happily coexist on the same roads if only we get the regulatory mix right. But from where I sit behind the wheel, I can tell you they’re both wrong: one must die for the other to live.
This appeared in the September 2015 issue.