How the ‘sharing economy’ disrupts civilization | Ed Ericson Jr. | TEDxBaltimore



so when faced with the problem there's really three possible things we can do we can ignore it we can try to solve it or we can exploit it try to make a buck so I'd like you all to think with me today about how some of the people in the tech industry are defining their problems our problems and what they're doing about those problems because about 9 10 months ago last April I started thinking about this I sat down one Friday afternoon and I wrote a rant about the sharing economy that's you know uber lived Airbnb those guys since now it's now called you know the gig economy or sometimes the on-demand economy and it's become much more crowded field you got all these little app based personal valet services that are all predicated on the idea that there's always going to be a desperate pool a huge pool of people who are willing to work any hours for very little pay and no job security and no chance for advancement and it looked at this business model and I said you know this is undermining civilization what these guys are doing if they're if they have their way pretty soon there's not gonna be any full-time jobs for any of us I said because what they're really doing is they're formalizing and expanding Jap kana me everybody knows what the shadow economy is right that's that guy down on monument street maybe selling loose cigarettes or sometimes hats and mittens this time of year or maybe crack the shadow economy exists in every economy in every country to a greater or lesser extent according to how much civilization is present and so I wrote this all down and I looked at what I'd written Knight though well this really isn't much of a of an insight I wasn't really gonna publish it I sent it around the office what did get up online pretty soon as a blog post and then it got 60,000 reads in a couple of days got about 20 times the usual traffic that a blog post at City paper gets so it hit a nerve and the tech you know tech sites picked it up slash bounced it anyway then something weird happened people disagreed with me I know so now people what people didn't say oh you're wrong about there not being any jobs in the future what they said is that what do you with a job for jobs are such a great thing you can you know having an economy based on full-time jobs is really inefficient it's what people were saying to me and then he said something that irritated me they said you know what it doesn't matter what you think because we're gonna do it anyway it's inevitable so adapter die and I like really because I always thought I had a choice right I thought we all had a choice about what kind of society won't want to build for ourselves that we could go to the ballot box and choose the people we're gonna promulgate the laws that companies have to follow in a democratic and free society oh no no no my critics I'm arguing on the internet my critics are like no no you got that all wrong free is when we get to do what we want to do and then democracy is when you choose the app that best fits your lifestyle and the government better get out of the way and I'm like has dumbfounded right because I'd never been wrong on the internet before so anyway so I wrote my thing and I took my lumps and I didn't think too much about it for a few weeks until I got invited to give this talk and then I thought wow I get a second chance now I'm gonna now I'm gonna convince these people that they're really not correct but then I thought well how am I gonna do that I don't have a lot of juice in this in this in this business I'm not a venture capitalist I don't code I'm a reporter at a newspaper I am a low-level worker in an industry that's dying precisely because it has failed to adapt to technology what can I do I know what I'll do I'm gonna get their argument right I'm gonna figure out exactly what they're saying I'm gonna make a lot I'm gonna pay a lot of attention to what they're saying and then I'm gonna really know them and then I'm gonna be able to do something with that so I started paying attention to this business and pretty soon uber is starting to poach loot lifts drivers and they give them a little bonus for this and then whoever's got somebody on the payroll bunch of people on the payroll their whole job is to mess with lyft they order a ride and then they cancel what is the last moment then Hooper starts saying and you know what our drivers make $90,000 a year on average on average Wow that's almost unbelievable and then ubers got one of their high-level peoples in a whole room with people and he starts saying you know the people who criticize us uber we ought to do some opposition research on that and we can get the dirt on them and shut them up and I'm like but there's still people there's still people on the other side of this argument and and they're all like leave me alone I'm disrupting you well finally I got I got the I got the picture and I was like I'm not going to argue with these people because to some people in the tech industry civilization is an obstacle it's an obstacle – they're hitting it big and these are people for whom innovation is progress – the Enlightenment progress – the Enlightenment we don't want to need John Locke in and we don't want any Rousseau there's not even any Adam Smith because we have iron rod in sparknotes and so yeah I finally got so I probably realized I can't I can't argue with them I got to convince everybody who's not them that what's at stake here is a big deal what's at stake here is a social compact and another thing that this really isn't in an innovation what this what's happening is really just an evolution of what's been going on in business in America especially for the past 40 years when you think about it you got to look back and see who's making the money and who's really making a success of themselves they're the company set off load cost and risk right so you're in a high tax business will you get some accountants and you figure out how to reincorporate in Bermuda or something like that right or if you're a rich person you don't wanna pay taxes either you get wealth management to come and put all your stuff in a trust right or you know what you say you're a wealth management by the way this is it this is a huge industry that didn't exist until the 1980s okay so you've got a factory in your pan you know union labor Oh nobody wants to do that what do you do say it with me folks what do you do that's right you send it to China everybody knows it's a cliche but what if you can't do that what if you have to have people here well you turn them into independent contractors don't you and that's what the taxi industry started doing in the 1970s that was an innovation all these little taxi companies all over the country one by one and in pairs they started calling in all their taxi drivers to Rome he said you know what folks I'm tired of paying you you're gonna pay me from now on that's how we're gonna do it 100 bucks a week say and for that you get to drive the car you've been driving all this time you get the license to be a taxi driver also get the dispatch service and here's the great news every penny over that hundred dollars a week you get to keep welcome to the American Dream fellow entrepreneurs so these taxi drivers are like because now suddenly they are responsible for all the all the insurance you know didn't have to deal with before they're never gonna get overtime anymore they can't get paid vacations right if they get hurt in this job they're not they're not eligible for workman's comp to get fired – now that was eligible anymore for unemployment insurance right and then at the end of the year they get to deal with their taxes like a small business so you get these taxi drivers like so what do you think happens well a lot of blow it off right they don't know what they're doing plus they're an all-cash business you're turning him into scofflaws right oh but also they're not making much cash why not you might ask because that hundred dollars a week has nothing to do with what it cost to keep the car running is everything to do with what the taxi company owners knew it would take those guys and women forty hours a week to make by the mid-1990s in Central Florida taxi drivers were paying $500 and up to rent their vehicles and they were clearing about twenty five thousand dollars a year on average and I know this because one of the drivers called me up one day I was a reporter down there he said we're tired of this we're gonna assume Mears transportation he was then and still is the dominant taxi provider in Central Florida he says we're suing that guy so it's amazing why don't you let me see what you're up to they spent a few weeks and checked out their numbers and they were telling the truth they were making six bucks an hour working 70 to 80 hours a week for 52 weeks a year so I called up all mirrors and I went to his office and I said Mr Mears you guys making six bucks an hour what do you say to that and the guy leans back in his chair and he says guys they're cryin poor mouth you want to know why cuz they don't like to pay their taxes now at the time Paul Mears had a 50-foot yacht called off duty just just for fun a few weeks ago I checked him out I want to see how he's doing turns out now he's got a 78 foot yeah called off duty and look at this I don't you can see that it's owned by a trust you know I Wealth Management my friends because nobody likes to pay taxes what are taxes by the way taxes are the price we pay for civilization okay so fast-forward 2010 you're in San Francisco all these kids are young people were trying to try to make a living and coding and stuff like this while they don't have cars taxis are horrible none of them want to drive us so short distances they won't come when they do come they're surly the drivers have a bad attitude right the cab stink they actually smell inside you get the back seat it's all hammock tup it's horrible taxi why all these problems with the taxi industry can be laid at the feet at the 1978 innovation turned them all into 70 hour 80 hour week hustlers okay but this is this is a regulated industry how could this happen oh well maybe the taxi companies own the industry maybe they own the regulator's this is not a secret either right uber lyft all these guys are talking about how we're against the taxi monopolists we're gonna beat those guy well okay good let's see what you guys are doing you know the problem are you ignoring it solving it you're exploiting it look at the difference in the business model taxis regulated fare uber we have an algorithm we're gonna charge you what we think we'd get away with ok score work for them taxis your your pay to drive the car maybe rent them the medallion uber lyft they're like everybody should drive for us you should alter it for us ubers like to make 90 thousand dollars a year why wouldn't you taxis are a regulated business the main regulation is they limit the number of cars out on the street and here's a crazy thing they do it on this crazy theory that if there's too many people out there trying to collect fares there won't be in Affairs for anybody to eat uber lyft anybody should drive for us I talked to the co-founder of lyft he says everybody should drive for us I said his name is John Zimmer I said John if everybody started for you how's anybody to make a living he says oh they're doing other things there might be teachers there bartenders something like that I said really in other words my business model has nothing to do with my workers making a living the other thing he said that hasn't got enough attention I think John Zimmer co-founder of lift these are the good guys I get beat up he says he says live was inspired but with the other co-founder found in Zimbabwe this guy was out in the hint in the hinterland of Zimbabwe people are walking down the street with dollar bills with money in their hands anybody with a vehicle might stop pick him up he's looking at the shadow economy in a developing nation and he says all that's so social we should uproot that make that the way we do things in America any place you've traveled outside of you know the major countries you're gonna find this thing this was the chicken bus this is a and Laos I think looks pretty safe right that's the model third-world okay and by the way to legal in Zimbabwe to in Harare they have regular cabs but this is not those this is the illegal guys right Zimbabwe has a per capita income of one hundred and thirty dollars a year what do you suppose happens when oh by the way that means nobody really much pays taxes that means the government's corrupted cetera et cetera what do you think happens when they don't pay the bribes at the cops demand in order for them to keep running illegally social okay so imagine this what if it were what if what if the burden approval reversed what if it wasn't up to me to stand up here to make the case for why you know the developing world's system isn't the thing we should graft on to America and make our future what if instead it was the shadow economy people they had to stand up here make the positive case for why the developing world social political economic system was the thing America ought to shoot for three things you can do with the problem right you can ignore it you try to solve it you can exploit try to make a buck so when everybody to ask yourself what are the sharing economy people choosing and what are you going to do about it thank you very much




Comments
  1. I think Ed is missing the bigger picture, WHY this sharing economy is becoming popular. It's all about capitalism, it's all about the massive transfer of wealth from the workers to the capitalists.

    Ed explicitly gives a wonderful example of why capitalism is eating itself with the story about the taxi industry. Why do we have Lyft and Uber? Because the taxi industry is so corrupt and the workers are treated so poorly. Who are we going to blame for that? Well, the people that go into direct competition with that corrupt industry, of course.

    When people are stuck at dead-end jobs, trading their lives for the smallest pittance that their coprorate masters can get away with while the corporate overlords just get fatter decide enough is enough and try to make money in a more creative, palatable way, who should we blame? Obviously not the oppressive rich, but the people who want more out of life. How dare they strive for more fulfillment! They should just shut up, plug in and mindlessly work as a cog in the machine!

  2. I've been laid off 8 times. How is a job better then being an entrepreneur?
    Employees pay higher taxes. Entrepreneurs make out better at tax time because they can write off more. This guy is a dreamkiller.

  3. try to exploit it … make a buck

    That right there is your problem.

    America really needs a lesson on the essence of money.

    hint: that is NOT how you exploit the sharing economy.

  4. two-words…creative destruction.

    Where would we be today if people like ED Ericson were to have had their way around the birth of the railroad system. "IT ISNT FAIR! MAIL BY HORSE WILL GO OUT OF BUSINESS and "civilization" will perish…. "

    "Taxes, the price you pay for civilization"…..but who are you to impose on us YOUR notion of "civilization"……….

  5. Another model that involves money. "Sharing economy" can be another exploitative economy to their volunteers, or workers. Many workers have to work several jobs in this economy to make enough to survive.
    Not relying on your tax money, money from government funded charity organization and money donation from people is the real sustainable movement: unlike some of these models under "sharing economy" that rent something in exchange for your money is just another profitable form of capitalism in disguise. Do some research on who they took from to start their company.

  6. I have just observed a bitter and jealous TED 'talker' who sees companies like UBER as a threat to the already corrupt and abusive status quo.  The reason UBER and AIRBNB took off was precisely because people realized that they couldn't any more rely on the government and on established providers to provide the goods and services they needed at a reasonable price.  The reason he's obviously pissed off is because someone else has a finger in the capitalist pie who, according to his definition, doesn't deserve to put a finger in there at all.  Look at what these hotels and taxis charge — in any case, way higher than what many can afford.  They can line up all the excuses they want but they simply have lost touch with the paying public.  Of course, there's a market in there somewhere for all these disgruntled people and why oh why shouldn't enterprising 'sharing' companies take advantage of it?  Oh yea, I forget … capitalism is only for the status quo.  Right?  The rest can just eff it.  Right?

  7. Wow most of these comments are written by children who believe in socialism. I think the shared economy has flavours of socialism and its completely damaging. Its like this. A bunch of silicon valley companies promote how great their free services are. The public all subscribe for free and meanwhile all the data and power becomes centralised. 

    "Freedom consists of the distribution of power and despotism in its concentration"
    – Lord Acton

    "Socialism is slavery"
    – Lord Acton

    Uber has been damaging to the taxi service. Amazon have damaged retail. Zuckerberg makes billions and billions of dollars while all his users give their data away for free. Information being free has made it very difficult to capitalise from which is creating more unemployment. There is a shrinking middle class. Millennials are the first generation to earn less than the previous generation. The internet was supposed to be a gift to humanity, reducing hours of work and make life easier, but instead people work longer. The idea of capitalism being based on hierarchies of inequality allows for voluntary action to work for power. When you have a shared economy you are powerless and platform owners have all the power.

  8. He focuses only on one aspect of the sharing economy and only on those who choose to exploit it rather than partake in it. Not once those he mention the excessive amount of waste produced by modern civilization that could be put to better use elsewhere and not in some dump

  9. The answer here is simple. The market will decide. If the author's ideas are correct that sharing economy service providers are put in a terrible position, then what will happen? They will stop providing the service and the sharing economy (at least in that sector) will end or dramatically diminish. And then what will happen when consumers want more rides than can be provided–that they're willing to pay for? Other business ventures will rise up to meet that need. That's what an economy does.

    The speaker talks like the Uber/Lyft ideas are the end of all innovation in the ride giving market, which is ridiculous. Maybe 50 years from now, there will be no such thing as 40 hour a week jobs and everyone will work a couple part time jobs to make ends meet. Or maybe I'm completely wrong. But the speaker appears stuck in 1970 and seems to believe that that's the only "right" way to do things. He sounds like the kind of guy who would decry innovation because it causes people working in obsolete product industries to lose jobs.

    This was the poorest TED talk I've ever seen.

  10. I am so glad they are disrupting it. I hope they tear it apart. Then Burn it to the ground at least the way it's organized now. So inefficient, so greed based, so much lack of innovation. They want people to believe money creates things but it doesn't money just buys supplies to make more of the thing thats invented. Most innovation is done by one person or small group of people with a problem. They would like people to believe we are all needed to work as cogs in a giant machine. He speaks of low wage jobs.. how about no wage jobs. Even better, eliminate the human element of any manual labor, then remove the human element of any service that does not actually bring someone joy doing. Like music, art, poetry, science, gardening for pleasure not for production. The jobs market is saturated with jobs easily handled by todays machines and algorithms. They need to go away. It sounds cruel but it's the truth. A machine making iPhones that needs no humans run on solar, and using recycled plastics, recycled metals, and using new process of using micro nanotubes, or graphene circuits would last longer, be insanely durable and the batter could be smaller and last longer, you even could install silicone and small solar film in the screen to trickle charge it whenever exposed to light. This is all possible now. Not 25 or 50 years from now. What stops this? Money. Thats it. Nothing more. Someone is saying no. You can't have this or that because it costs too much of this paper I created that is obsolete. It's insanity. Then say you build large mobile concrete house builders like they just finished creating in japan like 4 years ago. They could create a house every 24 hours. Thats at current rate. Imagine 100 of them roaming the planet taking impoverished counties into modern age. It's only the tip of the iceberg. We have the means, we just have to get rid of what is holding us back.

  11. Probably one of the worst TEDtalks I've ever saw- I completely missed the defining point. Simply economic- supply and demand.

  12. You make some important points but it's obscured by your snarky, negative and judgmental attitude about people who are involved in the sharing economy. Right from the start, I sense that you "othered" them; you even use phrases like, "those people." My experience is that whenever we develop enemy images of other people, we reduce our own influence and irritate people. If you have passionate opinions about this new way of doing business, then express them; just do it without implying that people are bad, wrong or evil.

  13. government already does wrong 28th snoden helping reveal the wrongs. laws weren't in place stopping that. mico economize is how we will succeed without getting taxed

  14. big companies are outsourcing and using tax loop holes. we need to survive and be happy and prosperous.

  15. This tooth looks cool … I guess the "tooth" would accuse me of "Evil Objectivism", if I argued, that the Shadow Economy is a simple effect of the "Costs of Civilisation" being to high, specially, when you see, what is done with your contribution, by people, who define and tell you, that paying and working for them, is what it means to be civilised. Sounds like a cult to me, but also reminds me of Kandi in Sri Lanka, with its "Temple of the Tooth".

  16. The shadow economy – this is what happens when people realize that there aren't enough jobs to go around.

  17. The best slaves are the ones that don't know they are a slave, the sharing economy does go against the idea of having to work for the right to live. If there is a need for transport why do we need regulations to limit the amount of people engaging in filling that need? I see the speaker point of view being stuck in the current system and his idea of the future is just keeping things the way they are.

  18. That´s the saddest l´ve heard, that somebody has to argue against the case for sharing. Either we are a mistaken species, or we are being misguided down the wrong path.

    How about taking a constructive look at these alternative systems. Then look for the solutions that help to overcome the problems.

  19. To anyone who's okay with the gig economy (and this is not to say that I support or despise the gig economy), answer me this, are you working within the gig economy or are you on the administrative side of it helping to pull the strings (that is if you're not pulling the strings yourself)? Maybe you can help the rest of us see the big picture. I'm sure one of you is willing to answer, now don't everybody answer at once.

  20. Why do humans have to own everything? We don't own the cells/atoms in our bodies, or plants, or animals. They are shared onto us at birth and they are given back at death. It's all psychological, in the end the person who shares the most is going to gain the most.

  21. He makes some valid points. While the old system is certainly flawed, the new system has its own flaws. What is the best way forward?

  22. Five minutes in and already I don't like this guy. He and the big corporations are scared of the sharing economy. It's here to stay and it'll just advance more and more. There would be no sharing economy if you guys hadn't got so greedy and wrecked the past economy years ago.

  23. Good counter-points to the sharing economy although like the industry he works for has witnessed first-hand, wishful thinking and nostalgia will not change reality. The sharing economy is essentially optimally efficient capitalism and a prime example of the need for a counter-balance social system. Something like universal basic income may be needed as the foundation to a future super-efficient capitalistic society.

  24. 'Civilization' is an extremely emotive word which you have not defined. If it means a system based on consumerism, where the masses work like drones for the benefit of  a few multi national companies then I say 'let's disrupt it! If it means supporting a system based on economic growth at the cost of our environment and the very existence of the planet …yes, let's disrupt!

  25. uber is not the totality of the sharing economy… its pretty absurd to try to put the entire sharing economy in the shitter because the people that have made our original economy suck, have found ways to also infiltrate the sharing economy and make it corrupt

  26. Disrupting civilization is not always a bad thing. There are pros and cons to the share economy, but it has opened up many new possibilities. The old economy, based on secure 9-5 jobs is part of fading era, like it or not.

  27. If everybody is becoming a taxi driver nobody will be able to live from that work…. isn't it the same going on with the real taxi industry? The phenomenon to which you refer is called disintermediation. Disintermediation takes place when there is no margin for intermediators to get a piece of the cake. Uber is minimizing intermediation costs since the taxi industry failed to do so!Then what about 7 hours working days? What about living from different activities? Our world would be much more flexible and efficient. Wouldn't it?

  28. Capitalism, no matter how 'legal' has been a major cause of 6th extinction. This man is not in touch with reality. His mentality is obsolete. How can people be so out of touch? Seemingly intelligent.

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