The main driver of the taxicab industry’s misery, Uber Technologies Inc., was valued earlier this year at nearly $70 billion — though the company’s problems with sexism allegations and other internal turmoil may have knocked that figure down to $50 billion or so.
Another key player in the so-called new economy — the short-term home rental company Airbnb — recently was valued at $31 billion.
As ride-hailing companies decimate the century-old cab industry and home-rental businesses provide competition for hotels, here’s another big number to consider: The amount those companies have spent to influence politicians and public opinion in Chicago.
The long-running City Hall disputes over how to regulate the ride-hailing and home-renting businesses have been highly lucrative for lobbyists. Uber and Lyft, the other big ride-hailing company, have spent nearly $1.1 million combined on lobbyists in Chicago in the past 4-1/2 years, according to my analysis of city records.
No lobbyist has gained more from attempting to influence these debates than Michael Kasper, the longtime lawyer for Illinois House Speaker and Democratic Party Chairman Michael Madigan.
Kasper is best known for successfully keeping Rahm Emanuel on the 2011 mayoral ballot, fending off residency challenges. Soon after clearing Emanuel’s path to the fifth floor, Kasper became the best-compensated lobbyist at City Hall.
Kasper’s long client list includes both Uber and Airbnb, the biggest player in the home-renting sector.
Michael Kasper | Sun-Times file photo
He has raked in a total of $480,000 from Uber for City Hall lobbying since the start of 2013, getting a raise at the beginning of this year to $12,000 a month from his old monthly rate of $9,000.
Uber also is paying smaller sums for the services of lobbyists Mike Alvarez, who is close to Emanuel, and Tim Dart, brother of Cook County Sheriff Tom Dart.
The grand total spent on lobbying here by Uber now surpasses $550,000.
And that’s nothing compared to what Uber shelled out for a media campaign in Chicago last year, records show. The company spent more than $1.7 million on that effort, mostly for TV ad time.
Lyft’s payments to lobbyists also now far exceed $500,000. The company has paid $460,500 to John Dunn, a former top aide to Mayor Richard M. Daley who began representing Lyft in 2014.
The ride-hailing companies have easily outspent what the taxicab industry group, the Illinois Transportation Trade Association, has managed to muster for lobbyists. Its advocates report getting paid only about $10,000.
A recently released study found 42 percent of licensed taxis here are off the road, and the value of city-issued cab medallions reportedly has fallen to less than one-sixth their worth four years ago, from a high of $370,000 to about $60,000 each.
“We were all doing it on a pretty reduced rate, recognizing the taxi industry is in pretty bad shape,” says Mara Georges, who was the main lobbyist for the cab companies and served as corporation counsel in the Daley administration.
The chairman of the City Council’s Transportation Committee, Ald. Anthony Beale (10th), says all that cash from Uber and Lyft made a significant difference at City Hall, noting that his efforts to increase regulation of the newcomers were thwarted.
“That’s a huge amount of money,” Beale says. “It buys you the best lobbyists money can buy. It’s a large sum that’s been spent strategically, in order to put the cab drivers out of business.”
Pointing to the rash of foreclosures against cab owners who had borrowed to buy medallions, Beale adds, “You can’t give away a medallion these days. They’re leaving cabs on the side of the road, parking them in front of banks. The industry is on life support. The cab industry could not compete with that flood of money.”
Asked about the amount Uber has spent on lobbying in Chicago, company spokeswoman Molly Spaeth replied, “Uber is proud to provide reliable transportation and flexible earning opportunities for residents across all Chicago neighborhoods.”
Spaeth says Uber had enhanced its public standing here by partnering with local organizations such as the Urban League and the YWCA “as well as working to educate elected officials and residents on issues important to our riders and drivers.”
As for the short-term home rental business, Airbnb has paid $115,000 to Kasper, and it forked over $90,000 to Dunn for about a year’s worth of City Hall lobbying.
Like Uber, Airbnb waged a media campaign here a year ago. That cost Airbnb another $1 million, records show.
There’s one other number that surely would be interesting to know, but that I haven’t been able to find out.
Ari Emanuel | Sun-Times file photo
How much does the mayor’s brother Ari Emanuel stand to profit from Uber?
More than three years ago, I reported that Ari Emanuel’s giant talent agency had invested in Uber. At the time, a spokesman for the agency, William Morris Endeavor, described the investment as “minimal.”
The company’s valuation then was estimated at $3.5 billion.
The mayor has tried to laugh off any suggestion that his brother — who represents some of the biggest stars in the world — needs any help from him to make loads of money.
Now, it’s far too late for the mayor to recuse himself from the question of how ride-hailing companies should be regulated, as I called on him to do years ago. Regardless of whether he’s sincere in thinking it was the right policy decision, Emanuel has done something that must be positively affecting his brother’s finances.
The mayor has seen to it that the ride-hailing industry enjoys less-stringent regulation than the cabs that they quickly are annihilating.
It’s no less than Uber and Lyft might have expected in return for their major investment on lobbying in Chicago.
