UBER BLOWBACK & Capitalism With Author Steve Hill



this is Steve zeltser with KPFA workweek radio and I'm with Steve Hill who was a writer journalist and has been investigating the uber lyft phenomenon these platforms and what they mean for the working people and the future of them welcome to workweek radio Steve why don't you talk about this it's going to be a protest tomorrow of drivers a strike and also the plant IPO with the purported value of 90 billion dollars yeah I mean we've really come full circle with this company and ride-hailing ride-sharing as they call it haven't we I mean how many years ago was that people were hailing this as the new revolution this is going to be the way transportation is going to work this is going to be the way we're all going to find work if the work will just come to us you can just drive for it and now we know the reality of what this business is it's basically first of all it's riding on the backs of its workers because the workers are there was a study done recently coming out of Stanford University to MIT it found that these workers on average don't even make minimum wage especially once you subtract the their own expenses for driving their own car which are considerable the workers have no autonomy on the platform you can be cut off that platform without notice if uber doesn't like what you're doing there was an example recently where you know a few thousand drivers were cut off the platform because they were refusing certain rides that were short because if you're if you're an experienced driver you know that you don't make money on Shore Heights because the uber tax aren't so many little fees the safe rider speed and all these sorts of things you only make money on longer rides and so drivers when they start feeling oh this is gonna be a short ride they just say no I'm not going to do that right and because their acceptance rate was too low a couple thousand of them got cut off the platform without any notice at all then they hand in their right of appeal there is no appeal there's no unions there's nothing like this to this these are the crummiest jobs of the future and they're happening right now so you so labor is is bankrupt when it comes to BER let's look at the environment has anyone noticed that traffic has gotten so bad with all these uber and lyft cars riding around San Francisco and all in the Bay Area I mean what do you expect your you take a dense urban environment you introduce into that environment another several thousand cars and what do you expect is going to happen right in San Francisco they did a study not that long ago they found out that there are about 1800 regular traditional taxi cabs in San Francisco and any one time there are 9,000 uber and lyft cars there are five times as many uber lyft cars as there are regular taxes they have completely flooded the streets and as a result everyone is sitting in the traffic now with all these cars that are on the streets so there's so many ways like this uber has been just a terrible addition to the the urban environment I mean what it does show us is that we need more public transportation that is good quality transportation I'm not totally sympathetic to people who you know they get on Muni and it's not reliable it's not fast sometimes it's dangerous and then also there weren't enough taxi cabs on the streets before the 1800 was it enough to service the man they could have doubled that and it would have helped out a lot instead of you know a little having 9,000 uber lyft cars so we really need to look at the urban transportation situation and create good jobs where people can get to where they need to go home and work and these sorts of things on good reliable transportation and we don't have that now and over and lyft are not the answer to the problems that we have not today not tomorrow not for the next 10 years and they call themselves the disruptors they have ignored regulation and basically the politicians have allowed them to destroy the taxi industry and basically run roughshod over any kind of rules and regulations this disruption of the rules of laws and which has kind of been acquiesced by the politicians it seems like they really I mean the political show absolutely you know a might the book that I wrote about all this the title of it is raw deal how these uber economy and runaway capitalism are screwing American workers I go into how the politicians really have tout out to to Gubarev over they actually changed their name from over to over technology company because they tried to say look we're not a transportation company we're a technology company is therefore the rules and laws of transportation shouldn't apply to us you know we're just a platform that connects the driver to someone who wants a ride and so they really tried to push this line for many years they don't do it as much anymore and it just doesn't fly you know I mean the reality is is that one of the big mistakes that California did under Governor Jerry Brown because we were one of the first states to try and regulate this is we passed the law at the state level and made it so that cities couldn't couldn't adopt their own laws we're at this point we've been prevented in San Francisco for an Oakland and other places from adopting our own local laws to regulate this and it's I mean you know the needs of San Francisco and Oakland are different than Fresno or Merced and you know we're all governed by this one state law instead of having the ability of cities like San Francisco to have its own law that is going to deal with the problems that uber has created and so this is a big problem we need to change that state law so that San Francisco can regulate things the way it needs to be regular I mean the local politicians here Aaron Peskin and some of the others they do realize the problems that are going on they would like to figure out a way to regulate this and a better way but they're prevented by this state law that Jerry Brown passed and the speculation is going on this IPO 90 billion you've got Silicon Valley who is going to make a lot of money they're going to be more billionaires more gentrification in San Francisco in the Bay Area you have people in the streets mentally ill people defecating in the streets you don't have housing for working-class people it sounds like this is dystopia gone wild in right here at the center of Silicon Valley and the development of technology absolutely I've lived in San Francisco now for over 25 years and I've seen this city in good times and bad and I've never seen anything like what this city has become at this point it has become a dystopia there is so much wealth here and there's about to be a lot more because once these IPOs hit you know this is going to be a ton of people at these companies who ever lived that are making them initially be millionaires and they could have all this money to spend on the same housing that you or I or anyone who is not a millionaire is looking to rent or to buy and so you're just going to be outbid as it's already been happening in a crazy way in the Bay Area for the last five six years it's just going to be that on steroids even more so it's really quite worrisome the politicians really need to step in I do see signs that the new San Francisco Board of Supervisors supervised like Gordon Mar and Hillary Ronan and some others are you know at least open to trying new things but the money amount of money that's being flooded into politics today is also creating a big problem I was one of the people that worked to pass public financing of campaigns here in San Francisco so that at least helps a little bit but you know it's we've got a big battle here in San Francisco and it's not going to go away anytime soon and there is going to be a strike that has been called for do the workers really have the power at uber if they act collectively and lyft if they do a collectively the problem is well there's a number of them but one of them is a legal problem because these drivers are defined in labor law at least over thinks they are as what's called independent contractors rather than regularly employed workers and according to federal law independent contractors are not allowed to organize a union and so this has prevented these workers from being able oh form Union and also these workers are part of what's now called a distributed workforce they don't work in any single work place where they know each other and can find each other they're spread out all over the place so it becomes harder to organize because you don't even know where your fellow drivers are there they are meeting online to some degree on wet boards and these sorts of things and that helps to some degree but it's a heart this is a hard workforce to organize and so you know there are there are a few things that we really need to do in order to help these workers to organize one is California can change its law to make it easier for these workers to organize there was recently a court ruling that ruled that these are it makes it easier to to submit to have these workers make a claim that they're actually regularly employed workers rather than independent contractors so the politicians at the state level need to step up and turn that legal ruling into an actual law that makes it easier for them to organize but we also could demand and pass a law that says to overlook you must give us the list of who your drivers are and then that that list can be made available to the drivers that they can find each other it can be made available to labor unions so that unions can find them and try to organize these people you know that would be a big step in the right direction because you know these workers deserve a decent wage for what they're doing they deserve to have things like health care and you know retirement Social Security and as an independent contractor whoever doesn't have to pay for any of those things for these workers that's not right and it needs to be changed and many of these workers come in from hundreds of miles away Los Angeles that's Central Valley they sleep in there cause you have the situation of the taxicab drivers committing suicide even uber workers it seems like the level of exploitation is becoming unbearable for more and more of the drivers yes you know and again that's the testimony so even though the unemployment rate is at record low levels the the quantity of jobs is high but the but the quality of jobs is extremely since the economic collapse in 2008-2009 the quality of jobs has just stay only gotten worse and worse and so as a result yeah you have drivers who are coming from Fresno and Merced and and Modesto and these other places who are driving here in the San Francisco where all the tourists are and they sleep in their cars they drive around the city they don't really necessarily even know the city so that's why you see so many of them doing crazy things on the street and double parking and blocking up traffic you know it's just it's just another sign of the economic distress there's so many individuals and families are under that people are working at these types of jobs there was another recent study that found that what you know they they interviewed a bunch of overdraw and lyft drivers and they found that these workers don't even know how much money they're earning they don't realize that they're making less than minimum wage once they subtract their expenses you know most people you know you work at your job and you don't have huge expenses but that go along with that job that you're working but when you're driving your own car and some of them have taken out loans that are facilitated by uber at high rates of interest and they think oh I'll get a free car you know three for now because you're taking out a loan and I'll be able to drive that car when I'm working when I'm not working you know for a lot of low-income workers this is a very attractive offer to be able to get a loan for a car that's backed up by uber but it's almost like you know the old days of of post slavery where these workers are house shopping at the company store because they're getting these high interest loans and they locked into them and so then they're stuck paying back the loans on these cars and they once they start realizing wow you know after I subtract all my expenses gas and parking and a memorization of my loans on this car I'm making barely a minimum wage some of these workers the study found are actually losing money and they don't know it and and so and suddenly they're locked into a loan that they can't even afford to pay back this is not right this is not how the new you your work the digital economy is supposed to work and yet it's happening right here in San Francisco at the epicenter of Silicon Valley unless you talk about the real cost of these ooh runs over and lift and I understand why they they do that you know look the bus system public transportation San Francisco is not so good you know there weren't enough taxis on the street for a while so people were eager to have another alternative I get that but what they don't realize is that when you get in that uber you're only paying 50% of the cost of that ride the rest of it is being paid by the venture capital thunders because whatever is trying to do is they're trying to they're using predatory pricing to drive the competition out of business the composition being lyft taxi companies taxi cabs and also public transportation that's a competitor for uber and lyft and so you know what we see now is the ridership on public transportation is down in San Francisco in New York City in every major city except for Seattle ridership is down because people are using over lyft and I've talked to you know some people I know who are regular users of it I have this one guy I asked them you know curious why you're taking lifts in this case rather than taking public transportation they said well you know I mean for me to take lift to my house work from here it's gonna cost me about $5 and the bus will cost me two dollars and fifty cents yeah it's more money but it's you know it's affordable to me so I'm it's just so much more convenient I'm gonna do that I said there what if the cost for you to take that lyft instead of being $5 what if it was $10 because that's the real cost of that ride he said well you know then I would take the bus and so there you have it ridership is down revenue into the public transportation system is down because when uber and the venture capital fund errs subsidize that ride of course people are going to take that and you can almost you really can't blame them but eventually this companies are going to they're going to start raising the prices they're gonna have to because I over just lost another billion dollars in the last three months of this year last year they lost about two billion the year before that they lost about 4.6 billion they've been losing billions of dollars every year because they're subsidizing all these rights ironic thing is the more you use it over the more money it loses that's not a business well yeah the extension to the airport SFO the broad extension to the Oakland Airport both of those are I understand losing money because of over senator Feinstein's for years tried to get federal money to do that extension of Bart to the airport we finally got the money built the extension and it's losing money because as anyone who has gone to the airport recently could see there are just a ton of uber lifts like flies all over you know what driving around that Airport because the rides again are subsidized that so people have to understand and you can you can understand people saying like well hey a venture capital wants to subsidize my rides afetr taxpayers through the public transportation system then I might as well take it okay fine but just recognize that the goal is to drive the competition out of business and that competition includes public transportation and once they've done that then they are going to raise the prices they're going to have to lead and double those prices that you're paying now in order to get the profitability if if that fact doubly will just get them to break-even they're gonna have to more than double the price in order to get the profitability and that is their goal they are a profit-seeking company and their venture capital funds are not going to put up with subsidizing you're right for that much longer that's what the whole point of going public with an IPO is about is now starting to get to the real world where they're going to have to get to a price point that brings them to profitability okay well I want to thank you again this is Steve Hill and he's a writer journalist and has been covering digital economy and the lyft and uber platform so thanks for joining us on workweek radio my pleasure you




Comments
  1. I worked for uber and Lyft. I was driving home at 3am after a long day of driving. There was a snowstorm and I did a 180 and hit the rail. Since i was on my way home and didnt have a passenger it wasnt covered by uber or Lyft. My deductible was $2000 and there was $5000 worth of damage on my van. So I lost 2k and a week of working. I stopped driving after a gang member looking guy starting swearing at me for refusing to drop him off in a dark alley.

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