Plouffe returns to DC to defend Uber

David Plouffe, the Obama confidant turned top strategist and board member at Uber, delivered a lengthy defense of the company’s role in the economy before an audience in Washington on Tuesday.

Uber, he argued, is a boon to people still feeling the effects of the economic crash and not, as critics have suggested, creating a class of drivers unprotected by the social safety net that has been in place for many American workers for decades.

{mosads}“There’s been much less focus on Uber’s broader impact on the economy, particularly the scale of that impact,” he said. “People are using Uber who are struggling to pay bills, who are looking to earn a little extra spending money or are transitioning between jobs.”

His comments were part of a larger appearance that seemed aimed squarely at Uber critics who say it is part of a host of on-demand economy companies shifting the way the economy operates away from steady, good-paying jobs and toward piecemeal “gigs” that workers take to make ends meet. They also argue that Uber may be mislabeling its workers as contractors, rather than employees who get more benefits and protections.

The debate is critical to the future of Uber and other companies like it. The company is valued at over $50 billion and growing quickly, but its ambitions could be complicated by a court ruling or regulatory decision forcing it to give its workers the benefits that come with employee status. Whether the workers are seen as contractors or employees will ultimately boil down to just how much control Uber maintains over their lives.

Plouffe argued that the company’s control over its workforce is limited.

He said the average Uber driver is looking to add to their income, not driving for Uber as a replacement for full-time employment. He said that of the platform’s more than 400,000 drivers in the United States, just over half drove fewer than 10 hours a week. The average number of hours worked by an individual driver has also continued to fall, he said.

Plouffe’s arguments positioned Uber as filling a gap for workers left behind by a sluggish economic recovery where wages have remained stagnant.

“There’s no doubt if people were getting 10 percent raises every year maybe they’d feel a little less need, but that’s not reality,” he said.

And he also touted what he said were larger societal benefits created by Uber — such as providing an option for women who might leave the workforce because of flexibility, hiring veterans and opening up new neighborhoods to small business.

Uber has long argued in local regulatory battles that its drivers serve low-income communities more effectively than traditional taxis, a point Plouffe reiterated on Tuesday.

“This has been a huge pain point and burden on people for generations,” he said. “But now with Uber and platforms like it, no matter who you are, no matter what your last name is, you can get the same ride as anybody else.”

His remarks, made before a packed house, marked his first comprehensive defense of the company in Washington — where regulators and lawmakers are warming to the idea of policing the on-demand economy.

Sen. Mark Warner (D-Va.) has called for legislation that would build a safety net for workers at companies like Uber, perhaps by making benefits more portable between employers or by creating a third classification for workers who are neither employees nor independent contractors.

Meanwhile, a federal court in California is in the process of considering a class-action lawsuit brought by workers who say they should be classified as employees.

Presidential candidates have also had to grapple with the on-demand economy’s effect on the workforce as part of a larger debate about income inequality.

Plouffe is no stranger to the demands of politics. After managing President Obama’s first campaign, he served in the White House as an adviser between 2011 and 2013. His hiring at Uber was seen as an attempt on the company’s part to bolster its regulatory efforts. And he said on Tuesday that the company wanted to be engaged with any conversation in Washington about the on-demand economy.

“Any ideas or policy proposals that look at any kind of adjustments are inevitably going to have to look at how they affect these industries and must take these equities into account. We’re eager to be part of that debate,” he said, before offering a cautionary note.

“If you look at the full picture of how people are using this platform, it’s clear that this is much more an opportunity to be seized on than a problem to be solved.”