Congratulations on the creation of The Lobby. You presented many interesting thoughts and invited your readers, by intention or not, to carry on with their thoughts.
I am just going to give you a little feedback on one topic now because it’s current and highly relevant to a large number of Californians: the ride-sharing gig economy. (I would love to come back another time to share a few words about Ikigai.)
You are correct in saying that it’s a lose-lose-lose situation. You might not classify it this way, but there are essentially three components in the gig economy: Capital (Uber), Labor (driver), and Public (rider). Let’s dive into a more granular level:
The Capital component includes inventors, technology, investors, engineers, salespeople, and other employees. For the sake of this argument, we are going to put aside the fact that Uber employees could also be in the Labor component.
The Labor component is not limited to Uber or Lyft drivers. Affected are also taxi drivers, limousine drivers, delivery drivers, and other commercial drivers. All these drivers have common and conflicting interests.
The Public component includes not just ride-share customers. Almost all segments of the public are affected by Uber, Lyft, etc. This includes the government, infrastructure, and other modality of transportation. Take a look at how the traffic around the San Francisco International Airport has changed. Also, tax revenues to the local government are negatively impacted.
According to Joseph Schumpeter, Creative Destruction in a capitalist economy elevates the value of some type of labor and simultaneously diminishes the value of others. Inevitably, creative destruction produces winners and losers. When the scale of the conflict is large, we have societal upheavals.
Inescapably, Capital and Labor are in an adversarial relationship. It is the public that determines who wins. The public in this situation is not just a dispassionate referee. The public is also a stakeholder. The public votes with consumer choices and with legislative actions. It is easy to posit that the gig economy offers greater consumer values. It is also convenient to argue in favor of gig workers' flexibility and the virtue of optimizing surplus labor and machinery. The truth is, the tech company (Capital) benefits disproportionally. Wages for a full-time Uber driver are barely above the poverty level, putting aside the void of employer-sponsored healthcare benefits. Also on the losing side is the San Francisco or New City City taxi owner/driver who paid $200,000 to $1,000,000 for a taxi medallion.
Uber is banned in some European cities and Uber drivers have been violently attacked. I traveled to Istanbul last year. All I needed to do to get a strong reaction from a taxi driver was to say the word Uber.
California SB-5 and Prop 22 are partisan solutions. They will only further the conflict between Capital and Labor, and widen the division among the public. No winner-take-all approach is fair or sustainable.
We need a comprehensive approach that takes into account all stakeholder interests. We need to be creative and cooperative wherever and whenever possible. When I was traveling in Dublin (Ireland), I noticed that I could use the Uber app to hail a taxi. That was the only way the Uber app could be used. I had hesitated to use Uber because, to me, supporting higher wages for the driver was more important than saving a few bucks. But I liked the ability to tell the driver where I am waiting and where I want to go, and most importantly, pay the fare without local currency. (If I were in Japan or Thailand, where the Uber app is used similarly, I also wouldn’t have to worry if the driver understands English.) I don’t know how the taxi company and Uber share the revenues, but it seemed to be a win-win-win arrangement.
Most importantly, I would like all stakeholders to broaden their views on the societal consequences of their actions. In California, if you want to build a shopping center, for example, you have to do an “Environmental Impact Study” and make available the report for the public to evaluate before you get a building permit. We want to anticipate how development affects traffic, road wear, air quality, water usage, waste disposal, fire protection, law enforcement, etc. Private businesses underpay for public services if we don’t make them acknowledge the externality cost. Unless you are a flaming libertarian, you would support this requirement — for the public good. So why wouldn’t we have an “Economic Impact Study” before implementing creative destruction in the market place? I am not suggesting for Uber to bear the entire externality cost. I don’t want them to have to reimburse taxi companies for their medallions. That would not be fair, nor encouraging for innovation. But if we have good data and scientific modeling, we can then work cooperatively and rationally toward a solution that minimizes social discourse while maximizing the benefits of creative destruction.
Congratulations on the creation of The Lobby. You presented many interesting thoughts and invited your readers, by intention or not, to carry on with their thoughts.
I am just going to give you a little feedback on one topic now because it’s current and highly relevant to a large number of Californians: the ride-sharing gig economy. (I would love to come back another time to share a few words about Ikigai.)
You are correct in saying that it’s a lose-lose-lose situation. You might not classify it this way, but there are essentially three components in the gig economy: Capital (Uber), Labor (driver), and Public (rider). Let’s dive into a more granular level:
The Capital component includes inventors, technology, investors, engineers, salespeople, and other employees. For the sake of this argument, we are going to put aside the fact that Uber employees could also be in the Labor component.
The Labor component is not limited to Uber or Lyft drivers. Affected are also taxi drivers, limousine drivers, delivery drivers, and other commercial drivers. All these drivers have common and conflicting interests.
The Public component includes not just ride-share customers. Almost all segments of the public are affected by Uber, Lyft, etc. This includes the government, infrastructure, and other modality of transportation. Take a look at how the traffic around the San Francisco International Airport has changed. Also, tax revenues to the local government are negatively impacted.
According to Joseph Schumpeter, Creative Destruction in a capitalist economy elevates the value of some type of labor and simultaneously diminishes the value of others. Inevitably, creative destruction produces winners and losers. When the scale of the conflict is large, we have societal upheavals.
Inescapably, Capital and Labor are in an adversarial relationship. It is the public that determines who wins. The public in this situation is not just a dispassionate referee. The public is also a stakeholder. The public votes with consumer choices and with legislative actions. It is easy to posit that the gig economy offers greater consumer values. It is also convenient to argue in favor of gig workers' flexibility and the virtue of optimizing surplus labor and machinery. The truth is, the tech company (Capital) benefits disproportionally. Wages for a full-time Uber driver are barely above the poverty level, putting aside the void of employer-sponsored healthcare benefits. Also on the losing side is the San Francisco or New City City taxi owner/driver who paid $200,000 to $1,000,000 for a taxi medallion.
Uber is banned in some European cities and Uber drivers have been violently attacked. I traveled to Istanbul last year. All I needed to do to get a strong reaction from a taxi driver was to say the word Uber.
California SB-5 and Prop 22 are partisan solutions. They will only further the conflict between Capital and Labor, and widen the division among the public. No winner-take-all approach is fair or sustainable.
We need a comprehensive approach that takes into account all stakeholder interests. We need to be creative and cooperative wherever and whenever possible. When I was traveling in Dublin (Ireland), I noticed that I could use the Uber app to hail a taxi. That was the only way the Uber app could be used. I had hesitated to use Uber because, to me, supporting higher wages for the driver was more important than saving a few bucks. But I liked the ability to tell the driver where I am waiting and where I want to go, and most importantly, pay the fare without local currency. (If I were in Japan or Thailand, where the Uber app is used similarly, I also wouldn’t have to worry if the driver understands English.) I don’t know how the taxi company and Uber share the revenues, but it seemed to be a win-win-win arrangement.
Most importantly, I would like all stakeholders to broaden their views on the societal consequences of their actions. In California, if you want to build a shopping center, for example, you have to do an “Environmental Impact Study” and make available the report for the public to evaluate before you get a building permit. We want to anticipate how development affects traffic, road wear, air quality, water usage, waste disposal, fire protection, law enforcement, etc. Private businesses underpay for public services if we don’t make them acknowledge the externality cost. Unless you are a flaming libertarian, you would support this requirement — for the public good. So why wouldn’t we have an “Economic Impact Study” before implementing creative destruction in the market place? I am not suggesting for Uber to bear the entire externality cost. I don’t want them to have to reimburse taxi companies for their medallions. That would not be fair, nor encouraging for innovation. But if we have good data and scientific modeling, we can then work cooperatively and rationally toward a solution that minimizes social discourse while maximizing the benefits of creative destruction.