Monday, December 22, 2014

New Orleans still hasn't figured out Uber, which is why we're still pushing to expand it

Just as the rest of the country is finally getting wise to a particular kind of grift, New Orleans is plunging head first into an effort to adopt it. It's a longstanding pattern of ours.
In effect, the measure also will be another step easing the way in New Orleans for Uber, a company that has stirred controversy nationally by challenging the established taxi and limousine industries with a service that connects drivers and passengers via smartphone.

Council President Stacy Head called the two-limousine requirement an “artificial and unreasonable barrier” that does not accommodate the level of demand from the city’s residents and visitors for for-hire limousine service.

“We still cannot in certain parts of the city command taxis at certain times and in certain neighborhoods, particularly if you are not in the downtown area,” Head said.

In case you are like Stacy Head and haven't been keeping up with Uber.. or don't quite understand what this company actually does, here are some links.

Uber is the poster company for what is known popularly as the "sharing economy." This is the phenomenon by which numerous service industries that once provided stable full time employment for thousands of people are "disrupted" by a new model based on on-demand freelance piecemeal labor.

For a while, this made them very popular with the mainstream press because 1) the mainstream press reflexively loves tech magic and 2) the mainstream press reflexively loves things that punish poor people for being losers. But after a few years of scrutiny, people started catching onto a few things.

Uber collects a lot of data.  A taxi company usually just needs to know where you are and where you want to go.  Uber wants to know everywhere you've ever been and to maintain possession of that information indefinitely. Because your data is a commodity, this helps explain why Uber is such a highly capitalized start-up.  "Ride sharing" is only half of their business. The other half is selling what you might have expected was private information.
A person who had a job interview in Uber’s Washington office in 2013 said he got the kind of access enjoyed by actual employees for an entire day, even for several hours after the job interview ended. He happily crawled through the database looking up the records of people he knew – including a family member of a prominent politician – before the seemingly magical power disappeared.

“What an Uber employee would have is everything, complete,” said this person, who spoke on the condition of anonymity for fear of retribution from the company.

A more sophisticated – and malicious – person with that access could have scraped data on a massive scale, then used powerful analytical software to learn things that Uber users might want to keep private, for professional or personal reasons.
Okay, but surely this is just paranoia.  Another round of privacy concern trolling from the luddites, right?  Well, no, actually it turns out the "sophisticated and malicious" people referred to here do indeed exist.  You don't have to look hard to find them.  They are Uber executives.

And, I think this is where they've started to dig a hole for themselves.  See, if you're a tech bro superstar, you can be as dickish and exploitative as you want to most people. Remember, the press loves tech stuff and doesn't give a shit about poor people for the most part.  But when you start bullying journalists themselves, that's when they turn on you.
A senior executive at Uber suggested that the company should consider hiring a team of opposition researchers to dig up dirt on its critics in the media — and specifically to spread details of the personal life of a female journalist who has criticized the company.

So Uber is an asshole's business run by assholes in an openly assholish fashion.  The assholes who own the company are celeb-billionaires while their typical driver pulls down about $34,000 per year.

Uber, and companies like it, exist because they exploit a particularly cruel paradox from the point of view of most people who work. The more productive we become, the less valuable we become.. in strict monetary terms.  We're reaching a point, in fact, where most of us, despite whatever reasonable education or skills we might posses, are essentially useless. And it's going to get worse.
Although fears that technology will displace jobs are at least as old as the Luddites, there are signs that this time may really be different. The technological breakthroughs of recent years — allowing machines to mimic the human mind — are enabling machines to do knowledge jobs and service jobs, in addition to factory and clerical work.

And over the same 15-year period that digital technology has inserted itself into nearly every aspect of life, the job market has fallen into a long malaise. Even with the economy’s recent improvement, the share of working-age adults who are working is substantially lower than a decade ago — and lower than any point in the 1990s.

Economists long argued that, just as buggy-makers gave way to car factories, technology would create as many jobs as it destroyed. Now many are not so sure.
This could be a terrible disaster for many many people. Already it goes a long way to explaining the onset of the so-called "sharing economy."  People still need money. And now large pools of them are underemployed and willing to work piecemeal.
There are only two requirements for an on-demand service economy to work, and neither is an iPhone. First, the market being addressed needs to be big enough to scale—food, laundry, taxi rides. Without that, it’s just a concierge service for the rich rather than a disruptive paradigm shift, as a venture capitalist might say. Second, and perhaps more importantly, there needs to be a large enough labor class willing to work at wages that customers consider affordable and that the middlemen consider worthwhile for their profit margins.

Uber was founded in 2009, in the immediate aftermath of the worst financial crisis in a generation. As the ride-sharing app has risen, so too have income disparity and wealth inequality in the United States as a whole and in San Francisco in particular. Recent research by the Brookings Institution found that of any US city, San Francisco had the largest increase in inequality between 2007 and 2012. The disparity in San Francisco as of 2012, as measured (pdf) by a city agency, was in fact more pronounced than inequality in Mumbai (pdf).
It doesn't have to be this way, of course.  The Luddites were wrong.  Technology is not what creates inequality.  Technology helps us create wealth in unprecedented abundance.  But as greater numbers of people become unnecessary to the process of wealth creation, we need to arrive at a more humane means of distributing it than labor.  The solution could be as simple as just giving people free money.
But there may be a solution. Some might see it as radical, but advocates, both libertarian and liberal, are suggesting straight up cash: a guaranteed subsidy to everyone. "We've got to a technological level now where no one needs to work the traditional 40-hour week," says Barbara Jacobson, chair of Unconditional Basic Income–Europe, an alliance of European citizens and organizations that advocate for such subsidies. But while productivity per hour across developing nations has increased dramatically since the 1970s, “this has not meant a rise in wages, or a fall in hours without a pay cut,” says Jacobson. And on top of that, she adds, there is a significant amount of “crucial work, generally caring work, which isn't paid for, but without which society would collapse.” The people doing this type of work—parenting and elder care, for example—often end up broke; if you are a single parent, it’s often not feasible to hold a traditional, wage-paying job while also taking care of three kids and your mother who has Alzheimer’s.

A simple cash subsidy—$15,000 per year (which is about what the average retiree gets annually from Social Security) for every household, say—would give the poor and middle class a financial floor on which they could live, take care of their loved ones and maybe, says Jacobson, "think about what really needs doing, what they would like to do, what they have trained to do, as opposed to simply what someone might hire them to do."

On the other hand if policymakers choose to keep things as they are, then the only "billion dollar ideas" churned out at your local Entrepreneur Week hackathon  will be the ones which most cleverly exploit a market of virtually free labor provided by increasingly desperate poor people.  Which is one reason Uber retains all these lobbyists. They want to keep the regulatory environment friendly to their business model.  They probably don't have to spend too much effort convincing Stacy Head, though.

1 comment:

Owen Courrèges said...

A guaranteed minimum income as a replacement for existing social programs is definitely an idea to discuss, although it's probably too radical to get any real traction. Democrats don't want to scrap any existing programs to fund a wage subsidy, and Republicans simply don't like the idea of public welfare. It's a tough sell.

As for Uber, you do realize that nationwide, cab drivers only earn about $32k a year, right? Uber salaries aren't high, but they aren't inordinately low, either. http://www1.salary.com/Taxi-Driver-Salary.html