Everyone was on tenterhooks late Tuesday night waiting for the outcome of a critically important election: Would Republican state Sen. Sue Serino keep her Hudson Valley seat, despite an influx of special interest spending against her? Yes, she did – and all joking aside, the result is important for the future.
The “special interest” in this case was Airbnb, one of the marquee brands of the self-styled “sharing” economy. In this race, Airbnb showed that it can play dirty politics as unabashedly as anyone in the old political and business worlds – but also showed that, sometimes, dirty politics lose out against reasoned policy debate.
Two weeks before the election, residents in Serino’s district got a flyer in their mailbox warning them that to vote for Serino would be to vote for environmental disaster. “VOTE NO ON SUE SERINO SO WHAT HAPPENED IN HOOSICK DOESN’T HAPPEN HERE,” the mailing instructed.
“Hoosick” refers to Hoosick Falls, a town in upstate New York where industrial pollution had contaminated its water supply. But Hoosick Falls is not in Serino’s district, and Serino had nothing to do with the regulatory failures that led to people there drinking unsafe water. The flyer didn’t explain how Serino is putting people in danger.
That was no surprise. The people who paid for the mailing weren’t clean water experts. The attack ad came, without saying so, from Airbnb, the multinational company that helps people rent houses, apartments and spare rooms to tourists.
Airbnb claimed it cared about the water because its “hosts” – its soft-focus term for people who use its website to engage in real-estate rental transactions with strangers – in the Hudson Valley care about the water.
A more likely reason? Serino had recently voted for a new state law that makes it easier for New York City to enforce its longstanding ban on people renting out apartments on a short-term basis, turning them into illegal hotel rooms. The law attaches fines to what have long been violations of state and city zoning and occupancy codes. The new monetary penalty should serve as a deterrent, easing the burden for regulators.
Airbnb could have done what the tech industry is supposed to help us all do: “disrupt” traditional politics – which is, let’s be honest, often a lot of distractions and distortions – and instead stick to the pragmatic facts. It could have sent fliers explaining its position on the issue, and why it thought Serino was wrong, and Airbnb did have an ad targeting Serino on her vote. But that ad, too, was misleading. It didn’t make a distinction between suburban single-family “homeowners,” which the law doesn’t cover, and urban apartment renters, which it does.
When it wasn’t using diversion tactics during this election, Airbnb obfuscated for a good reason: it had a weak case. The company’s most sympathetic argument is that some New Yorkers need the money from short-term rentals to pay the bills. In reality, though, if one believes in efficient economics and acknowledges that New York has a scarce housing market, converting tens of thousands of apartments into more lucrative hotel rooms pushes up the rent (and condo prices) for everyone.
It also creates chaos in medium-sized and large buildings, whose security guards have no idea who belongs and who doesn’t. And it is a violation of almost all residential leases. Residential property owners’ business model – enshrined in straightforward law rather than fought through tens of thousands of individual lawsuits against tenants – is long-term housing, not hoteliering.
Airbnb didn’t invent dirty politics. But it was dispiriting that the supposedly feel-good company was so willing to play the game. That’s particularly true because Airbnb’s business model itself worsens the economic anxiety that helped drive voters toward Donald Trump.
New York is hardly a red-state city. But just as coal miners in West Virginia are afraid of the effects of deindustrialization on their livelihood, working-class and middle-class New Yorkers are afraid of being priced out of their apartments and that their children will have no choice but to leave the city. In fact, new Census data shows that poorer and working-class residents of rich cities are already leaving in droves. Though it’s hard to know exactly what to do about this, Airbnb doesn’t help matters while cities try to figure it out.
Those non-rich people who remain in high-cost cities are afraid that a record number of global tourists – including, yes, millions of newly middle-class and upper-class people from the lower-wage countries that have helped put pressure on American jobs and income – are changing their city, and fast. And they doubt that the world’s economic elites, including tech giants such as Airbnb, are on their side.
Airbnb blamed “special interests” for its Albany defeat. But the real problem for Airbnb is that democracy worked as it should. Lawmakers, including Serino, responded to city residents’ concerns about the high cost of housing by protecting permanent housing for residents, not for tourists.
Airbnb did not like the democratic result, which is understandable. It has business interests to protect. But it is one thing to disagree with lawmakers – and to argue, respectfully and on the facts – for a different outcome. It is another thing to help “hosts” openly flout the law while bullying a lawmaker on an entirely unrelated issue: voters’ anxiety about polluted water. These tactics are uncivil – and Airbnb used them to advocate for policies that would make voters even more economically anxious.
The good news? Voters didn’t go for it. Serino won 53 percent of the vote to her opponent’s 42. What was supposed to be a close contest – and was a close contest two years ago – really wasn’t. There are lots of reasons for that: she had an incumbent’s advantage, for one, in an election in which Republicans did well nationwide. Still, it is good news that for now, lumbering old democracy can still win out over fast, new tech, even when tech uses the worst tactics of that lumbering old democracy.
This piece originally appeared in City & State's New York Slant
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Nicole Gelinas is a senior fellow at the Manhattan Institute and contributing editor at City Journal. Follow her on Twitter here.
This piece originally appeared in City & State's NY Slant