Wednesday, June 21, 2017

Travis/Trump: What Uber Tells Us About The White House

The fall of Uber's Travis Kalanick offers an interesting gloss on Donald Trump. If anything, Kalanick had a stronger position than Trump. Rather than narrowly winning an election in which he lost the popular vote, Kalanick had absolute control over Uber thanks to his super-voting shares. And unlike Trump, who is a mediocre real estate developer with a questionable record, Kalanick actually accomplished something by building what was once the world's most valuable startup (though admittedly, it is also the world's most unprofitable startup). Just six months ago, even though it was already apparent based on publicly available information that Kalanick had presided over a great deal of legally and morally questionable behavior, it seemed like his position as CEO of Uber was unassailable. And yet, despite his super-voting shares, Kalanick gave in to pressure from his board and resigned this week.
Let's be clear; the actions of Uber's board were not driven by moral outrage. It's not like anyone who was following the news would believe that Uber was a paragon of ethics and responsible treatment of women. Rather, Uber's board acted for what is nearly always the reason for action in the world of high finance and high politics: self-interest. Uber's investors pulled the rug out from under Kalanick when it became apparent that his leadership was reducing, rather than increasing, the value of their investment.
I often joke that if baby-eating aliens came to Silicon Valley, and built a successful, rapidly-growing startup, their investors would say, "You know, it's culturally insensitive to judge someone else's beliefs and habits. And besides, it's not like they're eating human babies." The line gets a laugh, but it is often an uncomfortable laugh, because they can picture the talking head in their mind already.
Kalanick didn't eat babies, but the people whom he brought into Uber did regularly break the law, and tolerated horrendous behavior towards their own people. In many cases, rather than feeling the proper shame for their actions, they gave off the sense that their only mistake was getting caught. And none of that mattered as long as Kalanick's people delivered their numbers. (In fact, that was the justification for ignoring sexual harassment complaints--the perpetrator was too valuable to the company to discipline!)
Over in Washington, Trump is Kalanick and the Republicans in congress are the Uber board. To date, they have largely gone along with Trump because he is more popular than they, and because they think it's in their self-interest to support him, largely because they fear the wrath of loyal Trump supporters who feel more loyal to him than to the GOP.
Each morning, Republican Congressmen/women and Senators ask themselves, "Will I be better off if I support Trump or oppose him?" The answer differs depending on their particular district or state, but by and large, what drives the answer is not whether they think Trump has behaved illegally in covering up his campaign's collusion with Russia (which he probably has) or whether they think he is a liar, bully, and sexual predator (which he definitely is). What drives the answer is mainly summed up in a single number: Trump's approval rating.
Richard Nixon held an approval rating of nearly 70% after his landslide victory over George McGovern. But the revelations of Watergate took their toll. In just a single year, his approval rating dropped to 24%, and it stayed between 20-25% until Nixon's resignation. While a core of loyal Nixon voters continued to support the embattled President, it became apparent to the leaders of the GOP that Nixon was going to turn the 1974 mid-term elections into a slaughter for the GOP. Key leaders like Barry Goldwater went to Nixon and told him that if he resigned, he would be pardoned, but that if he did not, he would be impeached and convicted. Nixon took the deal they offered and resigned.
Three months after Nixon's resignation, the Democrats gained 49 seats in the House (pushing them past a 2/3rds majority) and held a filibuster-proof 60 seats in the Senate. Of course, the results might have been even worse if impeachment proceedings were going on during the election.
Trump's power, like that of any elected politician in the United States, ultimately rests on his ability to win votes. The less popular he gets, the less power he'll have. And when he crosses some critical threshold, those Republican Congressmen/women and Senators will wake up in the morning and conclude, like the Uber board did, that while both alternatives would be bad, letting a compromised leader stay in power would be worse. At that point, just like super-voting shares didn't prevent Kalanick from being forced out, it won't matter if Trump still has a vocal core of supporters. The President cannot stand alone.

2 comments:

Anonymous said...

Well, I guess this is somewhat original, but seriously, the sooner everyone accepts we're stuck with Trump, and gets to work with that acceptance, the better it will be.
http://www.thedailybeast.com/liberal-impeachment-fantasies-have-to-stop

Chris said...

As I've written many times, if the GOP decides it will be worse off sticking with Trump than getting rid of him and dealing with the fallout, Ryan and McConnell would dump Trump in a hot second. The thing liberals have to realize is that they only way to defeat Trump is to convince the GOP that it's in its best interests to do so.