People’s Uber

Uber

It is probably more than a simple play of words that Uber China names its low-end line of service “People’s Uber” (人民优步). The egalitarian connotation sets it in contrast with its Chinese competitors, who invariably give their equivalent services a sense of privilege, calling them “exclusive car services” (专车).

Egalitarian or not, all these smartphone-based, internet-powered car-hailing services are subversive forces that are now sweeping through Chinese cities, upending the old, inefficient order of taxis and their government-backed companies.

In recent months, the struggle between the old order and the new forces has escalated into a national feud with the outbreak of taxi driver strikes in many Chinese cities, violent clashes between taxi drivers and Uber drivers, and ground-breaking lawsuits that try to define the legality of such services.

It is a situation that proves thorny for the government. As recent cases show, Uber and other copycat services are so wildly popular with an urban, tech-savvy class profoundly dissatisfied with the taxi services that any moves against the Ubers induce vocal discontents online, at a time when the top leadership is trying hard to woo the support of this group. But on the other hand, the interests that Uber threatens are also highly organized and entrenched. Their response to the advance of the Ubers can easily turn massive and nasty.

Two cases last week vividly illustrate the above dilemma. On May 21 the Beijing transportation administration carried out a major crackdown on what they considered “black taxis”, which involved private cars running Uber-like services. When pictures of the crackdown emerged on the internet, showing enforcement officers using hammers to forcefully break into cars and drag out drivers, they were greeted with an outburst of indignation and ridicule. Liberal commentators questioned the legality of such actions; Public figures, including well-known stand-up comedian Joe Huang and movie star Yao Chen, used their Weibo accounts to express discontent and disbelief. Tough-in-the-cheek Weibo personalities readily made fun of the authority by teasing them about “why not using the anvil as well.”

On the same day in Tianjin, a mega-city two hundred kilometers away from Beijing, taxis drivers took matters into their own hands. One of them solicited an “exclusive car service” as a customer, and then brought the car to a pre-arranged destination, where a group of taxi drivers waited to “give the driver a lesson”. Apparently, the Uber driver was not easily intimidated. He sent out a WeChat alert to his community of similar drivers, and in no time, hundreds of them came to his rescue. A major stand off and violent clash quickly ensued, which in the end required police to help disperse.

Caught between the wild popularity of internet car-hailing services among urban middle class consumers and the intransigent taxi interests, the central government’s position so far has been stubbornly ambiguous, if not outright self-contradictory. In Nov 2014, the spokesperson for China’s Ministry of Transportation publicly declared that internet-based car services “should not be killed with one strike of the rod.” It was widely read as a half endorsement of the Ubers until, four months later, the Minister himself hardened the Ministry’s stance by famously saying that “private vehicles should NEVER be allowed into the commercial services”, citing safety concerns as the main consideration.

But Uber and its sister services continued their aggressive expansion unabated. Part of the reason might be the existence of a mixture of seemingly authoritative signals which are subject to all kinds of favorable interpretations. Only recently, China’s Premier Li Keqiang has been advocating the concept of “Internet+”, a vision to upgrade China’s economy to a more information and data powered platform. And early this year, while numerous local governments were ramping up their campaigns against the Ubers, China’s central news agency Xinhua and the party’s no.1 propaganda outlet People’s Daily were publicly supporting such services with a series of widely circulated opinion pieces. For a nation so accustomed to reading the “tea leaves” of the coded signals from the top, such an environment is fertile for over-enthusiastic (mis)judgments.

Kenneth Lieberthal, an influential China expert in the US, once observed that it is difficult for outsiders “to determine with confidence which outcomes reflect strategic decisions by China’s national leaders and which instead reflect inherent dynamics of the political system that are beyond the control (and some-times against the wishes) of those leaders.” The Uber situation is a typical illustration of this challenge as at times you can’t tell whether matters are manifestations of the political will from the top, or mere reactions prompted by local power dynamics. Take the above mentioned Tianjin for example, on the one hand the municipal government announced all internet-based car-hailing services “illegal” a few months ago, on the other hand it has thenceforth only penalized eight “illegal” vehicles. It is likely that such actions were mere tokens to placate the protesting taxi interests, which were particularly vocal in Tianjin. There the ownership of taxis belongs to individual owners rather than large taxi companies, the former being much more financially vulnerable. Such a unique local set-up produces interactions that project uncertainty onto the national level where every development is closely watched by many.

The raw subversive power of Uber is creating problems for regulators all over the world. While the Chinese authorities are not the only ones scratching their heads, they do face a peculiar challenge of lacking institutionalized means to negotiate a legitimate compromise with the numerous interests involved. When an official from China’s central planning agency (NDRC) got interviewed for the Uber question, he made a typically dialectic instruction to the local governments: seriously take into account the need of the public, while at the same time handle the historically accumulated problems (i.e. taxis) with grace.

Not very instructive.

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