Why Uber makes me uneasy

Editors note: I’ve been sitting on this post for a while, and then when the Prop 1 vote was getting near, I thought it would be perfect to post this along with why I’m against Prop 1. And then the actual election snuck up on me and I missed it, but Prop 1 failed anyway, so hooray!

Let me start by saying: I have used Uber a few times (when I was traveling), and it’s pretty convenient. The technology generally works well, and it’s a pretty good idea and a definite improvement over calling a taxi.

But I have some serious concerns with Uber in particular, and I’m not sure about this whole gig-economy thing.

Firstly – Uber as a company has done some pretty shady things led by their CEO.

But the only reason the gig economy works is that companies pretend that their workers are contractors instead of full employees. Under US law, this means that companies don’t have to pay overtime and there’s no minimum wage, among other things. (this is probably also why Uber and Lyft call themselves “ridesharing” companies, which in practice is just not true) But, for example, Uber sets the rates that drivers charge, which is not what I think of when I think of an “independent contractor”. (they also tend to show up in a city with high rates for drivers to attract them, and then lower them over time so it’s hard to make a living) Uber can also effectively fire drivers if their ratings aren’t high enough, which again is pretty questionable. Here’s a good post that talks about some of this.

If someone wants to be an entrepreneur and start her own business, that’s great – she’s taking a big risk, but she can decide how to run the business and she has the possibility of a big payday. But if she instead decides to be a driver for Uber she’s taking on a lot of the same risks (with some added risks that Uber will lower her rates) with very limited upside. It doesn’t seem fair to me. (luckily in some cities Uber drivers are fighting back with some success)

Plus, call me old-fashioned (or call me crotchety!), but I think a full-time stable job is better for most people. If more real jobs get converted into these gig economy ones that makes me pretty nervous that this is going to increase income inequality even more. (in what I hope is a trend, Gawker’s new contract with their unionized workers has some protections for freelancers)

Now, a common argument I hear is that taxi companies aren’t great for drivers either, especially in cities where taxi medallions are expensive. And this is true! But I wish the answer wasn’t a race to the bottom.

(also, re Prop 1 – the city passed a law saying Uber and Lyft had to be regulated like taxi companies, which seems fair to me)

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