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Comment by itaifrenkel | Hacker News Reader

Could you please provide evidence/calc to substantiate this claim?

Uber, in its most profitable market, currently makes an average of $.19 per ride[1]. These regulations would substantially more than destroy that margin.

And that isn't even addressing the fact that driver liquidity would be worse because it'd be harder for people to start/stop ubering at will. Which would create inefficiencies whereby they'd have to probably maintain an oversupply of drivers just to meet demand, further compounding their profitability problem.

[1] http://www.businessinsider.com/uber-says-its-profitable-in-t...

>Uber, in its most profitable market, currently makes an average of $.19 per ride[1].

If Uber can't pay real wages and benefits to their employees because they make a margin of $0.19/ride, their business model is pathetic and deserves to be replaced by something more productive and efficient.

Uber already produces enormous amounts of consumer surplus. Two examples would be making it possible to get a ride while black and making it possible to get a ride while in San Francisco. If you feel they should go out of business unless they can live up to your standards cool but taxi regulators will be just as effective at protecting consumers after Uber goes out of business as before it existed.

Like what? Remember that taxis drivers are also independent contractors[1]. Is there evidence that a better business model is possible?

[1] http://www.unitedworkerscongress.org/taxi-drivers.html

Most of the problems with taxi drivers (and taxis) is that they are independent contractors. If you think you can offer a better service by controlling what your employees can and can’t do then that is fine, but don’t pretend that they are not employees just to get out of paying taxes and benefits.

And why do you or any specific group of people get to decide what "real wages and benefits" means?

I think Uber drivers should be able to decide what "real wages and benefits" means, and they should have the right to make that decision collectively if they so choose.

I think they get to decide it because they are the ones most directly affected.

The other option is Uber, but I think there's too much of a conflict of interest. Uber's primary interest is to maximize profits for Uber, not to maximize the profits of its subcontractors.

The specific group of people is the voting populace of the United States which has clearly defined the minimum wage that is allowed to be paid to an employee and also legally required benefit structure.

They get to decide because they are us and we vote to prevent brutal gilded-age era exploitation and abuse by companies, who are unbelievably powerful and can essentially decide on any terms in the employment contract which workers must accept, unless we vote to make them illegal.

> These regulations would substantially more than destroy that margin.

Why is that bad, though? The customers (or at least some of them) would go back to taxis, and then either taxi drivers/companies or customers would capture the $.19 that Uber was previously taking. It isn't immediately obvious why that would be worse.

Well, because every single person on earth would be slightly worse off. The size of the ride-hailing market would contract to pre-Uber levels, for one. This means fewer jobs for drivers and fewer dollars paid out overall. The liquidity of the ride-hailing market would go back to taxi-levels. You'd have to carry cash, and the rides would be slightly more expensive.

These might seem like relatively inconsequential details, but the sum of them over an entire economy adds up to billions of dollars of deadweight loss. And in an era of slowing growth, we really shouldn't be throwing these things away because it makes some people uncomfortable.

And yet you are dodging the argument again -- the argument is that allowing Uber to dodge all regulations is bad for Uber employees (while it is of course better for customers). And Uber is not the only company capable of writing a simple mobile app for taxi services. Taxi services certainly can do it (it is not hard) and will.

If it were the case that allowing certain companies to use slave labor were good for the economy (it is) then should we allow that as well? It would make every single person on earth better off. Well, so long as I don't include the slaves that's the case, but as you've chosen not to include the Uber drivers in your characterization I think that's fair.

> And yet you are dodging the argument again -- the argument is that allowing Uber to dodge all regulations is bad for Uber employees (while it is of course better for customers). And Uber is not the only company capable of writing a simple mobile app for taxi services. Taxi services certainly can do it (it is not hard) and will.

I disagree that it is bad for Uber employees. Yes, if you regulate Uber, the employees that remain will be better off. However, there will undoubtedly be fewer of them, and they will have a much less flexible relationship with their employer. Those are real costs that you can't simply ignore.

> If it were the case that allowing certain companies to use slave labor were good for the economy (it is) then should we allow that as well? It would make every single person on earth better off. Well, so long as I don't include the slaves that's the case, but as you've chosen not to include the Uber drivers in your characterization I think that's fair.

It is, at best, arguable whether slavery is good for the economy [1]. However, that doesn't really matter, because slavery violates basic human rights. Two consenting, informed adults entering into a voluntary, temporary agreement to exchange a ride for a fee violates nobody's rights.

[1] http://www.economist.com/blogs/freeexchange/2013/09/economic...

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