> Overall, you get more people working longer hours for less compensation
So then the solution to increasing wages is simply to ban hard-working, willing people from taking jobs! Brilliant. Let's force them to be unemployed just so that those who are allowed to work can make a bit more money.
The biggest flaw in your argument is that it completely leaves out the value of experience. Those lower-wage drivers are not signing up for a lifetime of low-wage driving, they are taking a job that they can leave after a few months after gaining useful/valuable experience.
The beauty of Uber is that it offers the opportunity of part-time commitment work to many people who have not had the option before.
Now, instead of pouring a stiff drink to reduce the stress of personal debt (for example) someone can hop in their car and make a few hundred dollars and actually do something about it. The impact of this on people's sense of being in control of their destiny is profound.