Uber is not a business in the traditional sense. It’s a “bezzle” (“the magic interval when a confidence trickster knows he has the money he has appropriated but the victim does not yet understand that he has lost it”).
The only reason Uber was able to attain growth was because investors gave it billions to lose. First, it was the Saudi Royals, hoping to spend their way to a transportation monopoly.
When that didn’t work, the company’s investors suckered the public into taking their shares off their hands in an IPO premised on two things:
I. Self-driving cars
II. All buses and subways in the world being scrapped and replaced with Ubers.
Neither of those things have happened, of course. Uber actually had to pay someone else $400m to “buy” the self-driving car division it sank $2.5b into (the resulting cars could not travel for one mile without a serious accident).
Replacing all the world’s transit is also a long-shot. That means that Uber’s bezzle is running out, forcing the company into ever-more-desperate measures to keep money flowing from suckers (“investors”) who believe that a pile of shit this big must have a pony under it.
Measures like spending hundreds of millions of dollars on California’s Proposition 22, which legalized worker misclassification. Measures like rampant wage-theft from drivers. Measures like waging legal wars against whistleblowers.
Uber’s “innovation” wasn’t self-driving cars. It was cheating. Uber is really fucking good at cheating.
How good? Well, last year, Uber managed to dodge tax on $6b in global revenues by laundering its income through fifty Dutch shell companies.
A report from the Australian NGO Center for International Corporate Tax Accountability and Research (CICTAR), reported in the Dutch press, describes Uber’s tax evasion innovations as “the Champions League of tax avoidance.”
It’s quite a whirlwind of socially useless financial engineering, composed of obvious frauds like “selling” its IP to a Dutch subsidiary financed with a $16b “loan” from a Singaporean subsidiary, garnering 20 years’ worth of $1b annual tax credits.
The Netherlands may be a bastion of progressive politics, but it’s also one of the world’s leading onshore-offshore tax havens, joining Cyprus, Luxembourg, Delaware, Wyoming and the City of London as a key player in the global money-laundry.
Its lax enforcement didn’t just encourage Uber to create 50 shell companies — it also let the company get away with failing to file “mandatory” disclosures for many of these “businesses.”
All of this redounds around the world — in India, Uber pays only half of the mandatory 6% tax owed by multinationals (India could really use that cash about now).
Vectors Point, PK (modified)
Ian Merchant (modified)
Cory Doctorow (craphound.com) is a science fiction author, activist, and blogger. He has a podcast, a newsletter, a Twitter feed, a Mastodon feed, and a Tumblr feed. He was born in Canada, became a British citizen and now lives in Burbank, California. His latest nonfiction book is How to Destroy Surveillance Capitalism. His latest novel for adults is Attack Surface. His latest short story collection is Radicalized. His latest picture book is Poesy the Monster Slayer. His latest YA novel is Pirate Cinema. His latest graphic novel is In Real Life. His forthcoming books include The Shakedown (with Rebecca Giblin), a book about artistic labor market and excessive buyer power; Red Team Blues, a noir thriller about cryptocurrency, corruption and money-laundering; and The Lost Cause, a utopian post-GND novel about truth and reconciliation with white nationalist militias.