Why there is almost nothing redeeming about Uber

Barbed wirePhoto courtesy of Gillie Rhodes

So okay, maybe I don’t hate taxis so much anymore. I get their place in our society. When your time is worth more than your money, a taxi can make sense.

But while I’ve softened my stance on taxis (even while still feeling a little uncomfortable in them), there has shown up a new “taxi company” in town that is disrupting the industry in a very troubling way.

I refer, of course, to Uber.

So what’s wrong with Uber?

Interestingly, it turns out that the answer is: everything.

(By the way, there are other companies that do similar things, such as Lyft. But in order to save typing, I’m going to refer to the largest and most well-known operator, rather than say “online transportation network company” all the time. So Uber it is.)

No one works here anymore

Uber doesn’t employ drivers; they are “independent contractors”. So the company acts like a taxi service, but then, when it comes to grating things like, say, all the benefits of being employed, they can retreat into the “we’re just an app” corner. This is sneaky.

Uber is not alone in this. This company is a product of the “sharing economy“, a euphemism that brings to mind kittens and rainbows, but has turned out to often mean “no-responsibility employment”. Originally, the sharing economy seemed to stand for a modern variant of Marx’s “from each according to his ability, to each according to his needs“. But then companies realized that they could extract lots of benefit from this system without incurring most of the costs.

Uber’s revenue was 1.5 billion dollars in 2015. Now, I applaud a company for doing well, but not when it pushes all the burdens of the job—insurance, liability, cost of the car and its maintenance—onto the driver.

The house always wins

Uber advertises heavily. “You can make money driving in your spare time!” goes the line. And it is a compelling tagline. Who doesn’t want to be able to get in their car, press a button on their phone, pick up people, drive them around, and get paid for it?

But the promise doesn’t pay out, to almost everyone’s detriment. According to a report by BuzzFeed in 2016, the average wage for drivers was less than $13.25 in a few metropolitan areas.

$13 bucks an hour? Assuming full time work, that’s about $26,000 a year. That’s not a lot, especially when you figure in the cost of using (and abusing) your car.

Now, this isn’t totally Uber’s fault, of course, any more than it’s Las Vegas’s fault that you lost your money on the slot machines.

Then again, I just compared “working for” this company to playing a slot machine. Which feels telling.

Speaking of “the house always wins”, the system pits all of its “drivers” against each other. Assuming a finite number of rides, the more people who drive, the fewer riders there are for them to pick up, and so the fewer fares there are for each person.

So much for “sharing”.

But it’s a cool app

From talking to people, the appeal of Uber is that it has an easy-to-use app, and that within a few minutes, a car shows up. With a taxi, you have to call and wait for a half hour.

But is that still true? I think it used to be true, but not anymore.

And this is one reason why I don’t think that Uber is worthless. They disrupted a complacent system, and showed that users want quickly-accessed personal transportation and they want it an app away.

Today, my local taxi company has an app that shows where all of its drivers are. And have you seen Curb? It’s like Uber, but it connects you to real taxi companies with real employees.

So the disruption has had a good effect on the industry. Thanks.

You can stop now though.

Stop, you’re hurting America

I see companies that take advantage of the sharing economy as nothing less than a danger to the fabric of our entire system of employment. Flexibility is nice, but not when it’s at the expense of the protection of workers.

And this is hurting all of us. By supporting companies that don’t employ their employees, by supporting “independent contractors”, we are sending signals that it’s okay to treat workers as disposable. If you work for a company that provides you benefits, don’t you think that they could come for yours next?

It makes me want to say “stop…you’re hurting America,” just like Jon Stewart did on Crossfire.

What is the alternative?

The nice thing is that you don’t have to use Uber, or any other similar service. (At least for now.)

There are “taxi companies” that will pick you up and take you to your destination. They take credit cards, employ drivers, have an app, and don’t even do surge pricing.

I support real employment, and I think you would do well to do the same. Vote with your wallet and support companies who treat their employees with dignity. Actually, let’s set the bar lower. Support companies whose employees are actual employees.

But enough about me. What do you think of Uber and other companies like it?

Mike Pumphrey

Mike Pumphrey

I'm the founder and author of Unlikely Radical, a site to help people succeed with money, achieve their goals, and live intentionally.

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Mike Pumphrey
Posted on February 2, 2017