Subject: Re: Hillary - Uber
From: Ben Scott <[email-masked]>
To: Tim O'Reilly <[email-masked]>, Jennifer Pahlka <[email-masked]>
Cc: "John D. Podesta" <[email-masked]>, Laura D'Andrea Tyson <[email-masked]>, Alec Ross <[email-masked]>
Date: Mon, 13 Jul 2015 18:03:56 +0200

Thank you both for the very helpful content. Couldn't agree more.  

The reporting you saw also caught me by surprise. I hear from campaign that the story is false and she will not say anything like that.  I am running down actual text to try to understand how wires got crossed.

Most important is for us to develop great content along the lines of what you sketch here to address the concern with alternative and better ideas.

Looking forward to reading your series on medium.  And will be back in touch soon to synch on content.

Sent from my Samsung Galaxy smartphone.

-------- Original message --------
From: Tim O'Reilly <[email-masked]> 
Date:13/07/2015  17:09  (GMT+01:00) 
To: Jennifer Pahlka <[email-masked]> 
Cc: Ben Scott <[email-masked]>, "John D. Podesta" <[email-masked]>, Laura D'Andrea Tyson <[email-masked]>, Alec Ross <[email-masked]> 
Subject: Re: Hillary - Uber 

Let me second what Jen says below. Of course, the reports about the speech may be wrong. But let me provide a bit of grist for the mill.

First off, I think that Uber and Lyft are very bad examples to pick on in contrasting the gig economy with the desired universe of the past full time jobs because they exist in an industry in which nearly everyone is already considered an independent contractor.  See

http://www.aei.org/wp-content/uploads/2012/08/-the-role-of-independent-contractors-in-the-us-economy_123302207143.pdf

"According to a 2005 study by the Center for Transportation Studies at the University of Missouri, “The use of the independent contractor drivers in the U.S. taxicab, limousine, paratransit and shuttle transportation modes (the private for-hire passenger vehicle industry) has become the standard business model.” As shown in Table Two below, the CAWA survey reports that one out of five workers in the taxicab and limousine business and seven percent of workers in the courier and messenger industry are engaged in alternative employment. Data from the Department of Transportation (DOT), as data collected by Taxicab, Limousine & Paratransit Association (TLPA), suggests the actual proportion is much higher. According to a DOT 1988 study, 74.1 percent of taxi drivers were independent contractors as of 1986. More recent data, from the TLPA, shows that independent contractors comprised 88.3 percent of all taxi drivers in 2009."

Second, if you actually talk to Uber and Lyft drivers, the thing they primarily value about their job is its flexibility. Many of them are part time. Those who work full time generally work as many hours as they want till they achieve their desired income. This is a kind of desirable entrepreneurial activity that is carried out by any small business owner.

And the alternative is far worse. I'm sure you are aware that one of the most pernicious aspects of the modern economy is that most low wage employers have shifted to a model in which they use algorithms to keep their workers below 29 hours a week in order to trigger the need for full time benefits.  (Obviously, there are some benefits that are available to both full and part time employees, but relatively few compared to the full time worker.) In fact, I spoke recently to a silicon valley company that provides next generation scheduling software that is designed to give companies the ability to offer better scheduling flexibility to their employees, taking account of things like shift change requests and so on -- and he told me that one mandate from their customers was the explicit ability to keep worker's hours below 29.  

For a view of this world, see Esther Kaplan's piece in Harpers', The Spy Who Fired Me (behind a paywall, but reproduced at the following URL):

http://populardemocracy.org/news/spy-who-fired-me

(There have also been lots of stories in the mainstream media, like this one on CNN, http://money.cnn.com/2014/01/13/news/economy/minimum-wage-hours/ about the problem for low wage workers being "not enough hours.")

I suspect the net effect of a ruling that Uber and Lyft workers must be employees would be that those workers would be limited to 29 hours - and they would work around the restriction by working part time for Uber and part time for Lyft. (Right now, they can maximize their hours by working for both simultaneously, and working for whomever first provides a customer.)

The negative income pressure from the 29 hour limit is far worse than any kind of wage pressure from Uber!  If anything, Uber should produce positive wage pressure on these kinds of jobs, since it provides an alternative with more worker control and possibility of income.

If you are going to go after anything, go after this pernicious practice. From what I've seen of the planned talk, the profit maximization of these companies at worker expense is already a theme.

I think that there's really only one viable policy option on the table, and that's the one that Nick Hanauer and David Rolf have put out, which is to use the same technology that allows workers to exist in a world of "continuous partial employment" (which is how I plan to put it in the next piece I am writing in the Medium series that Jen refers to below) to have prorated benefits across a number of employers. That would close the 29 hour loophole.

http://www.democracyjournal.org/37/shared-security-shared-growth.php?page=all

In addition to Rolf and Hanauer's "shared security" idea, I do think that technology could be used to build far better mechanisms for giving all low wage employees the ability to schedule their own time, giving them the flexibility and freedom that Uber and Lyft workers enjoy.

Net net, I think it's important for us to figure out how to make all low wage jobs better jobs, and not to make internet-enabled jobs a scapegoat.

If anything, the solutions to the the low wage problem are likely to come out of the gig economy, because it is ultimately technology that will allow us to decouple benefits from the constraints of a single employer.

I hope this helps!

Happy to talk more about all this.

_____________________________________________
Tim O'Reilly, CEO O'Reilly Media
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mobile 707-953-2280; office 707-827-7150; fax 707-823-9746
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On Mon, Jul 13, 2015 at 7:17 AM, Jennifer Pahlka <[email-masked]> wrote:
Some unsolicited off-topic advice this morning!  On what's being reported about the campaign and Uber here:
http://techcrunch.com/2015/07/12/clinton-uber/

My husband Tim O'Reilly (whom I believe you know) is getting a lot of attention for this idea of moving from the "WTF Economy" to the "Next Economy" and he's putting together his ideas in a series of blog posts leading up to an event in November.  The first blog post is here:

https://medium.com/@timoreilly/the-wtf-economy-a3bd5f52ef00

For us at Code for America, we all tuned into this line: 
We need to ask ourselves whether the fundamental social safety nets of the developed world will survive the transition, and more importantly, what we will replace them with.

My point is that while I am 100% about living wages, I fear if Hillary takes a stance in favor of "full time is always better" she'll slowly lose not only Silicon Valley but the folks who actually work in the gig economy and see its advantages, despite it's challenges.  A "full time is better" stance looks backwards, which is a losing game.  A Hillary in the White House should be figuring out how to build a social safety net for the economy we have now and the one we will have in 10 years, not try to return to a previous state.

Tim has a post queued up on the full time issue that I expect will be pretty influential.  I'm copying him here in case he can preview it for you.

Hope this is helpful.

jen

-- 
-- 

Jennifer Pahlka
mobile: 415 420 2933
@pahlkadot