Hillary Clinton Plans to Campaign Against Uber’s Contractor Economy | Hacker News Reader

Hillary Clinton Plans to Campaign Against Uber’s Contractor Economy

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51 pointsisalmon58 comments

The reason airbnb and uber exist is because the prior business models are broken with regards to a big enough portion of their potential customers. A conversation with the average taxi driver will reveal the job is no ticket to the high life or consistent pay.

The way forward is to get rid of the concept of 'benefits' packages and just let people work for a gross pay and let themselves choose their own benefits from that.

Ultimate flexibility is what efficient economies are about. Unions don't like that future and understandably try and fight it. It's a futile fight in the end.

The reference to qualifying for a loan based on permanent work is not relevant. A history of stable earnings is enough to qualify for a loan. Permanent positions are no guarantee of enough employment to pay down most loans.

> The way forward is ton get rid of the concept of 'benefits' packages and just let people work for a gross pay and let themselves choose their own benefits from that.

This. Among other things, it would go a long way towards fixing the health insurance problems in the country. One of the reasons the private health insurance market is so dysfunctional is that relatively few people participate in it (most people are covered by their employers).

The way the rest of the world has “fixed” health insurance is to have the state involved. Even the USA does this for anyone over 65 (where most of the spending occurs) and for anyone who is a veteran. For some reason covering the young and healthy seems too hard. It is almost as though there is a huge vested interest keen on maintaining the status quo at the expense of everyone else. Given that only unions are evil this could not be true.

Kevin A Carson outlined in an essay how hospitals justify their prices on everything from saline to surgery on a managerial model which treats every service/good as revenue on the accounting books. Oddly enough, they got this model from the auto industry which did the same sort of model which obviously demands consumers to use the service/good as much as possible.

For example, how many patients actually need a CT scan? Not many, really, but if you dig deeper the reason they do this is to get the maximum value of of their CT scan equipment even if a patient's symptoms don't match anything that would require such a service. Equally, many hospitals also compete with each other thus duplicate services or spend their budget on the look/feel of their facilities (how many people care wth the foyer of a hospital looks like?) which leads to the higher prices. Essentially, each patient pays the full cost of the medical services rendered unlike how consumers in other industries (the price of a meal or a cell phone is not at cost, often it's lower when you factor in everything to bring it to market).

I think the way to clear the system is to do a multi-tier approach which may include single payer healthcare, but if you were to install that system into our hospital system as is then expect the US to go bankrupt in less than a decade. We have to break the back of the monopolists before we can get anything close to sane market prices.

You do realize we had a time before unions and common benefits right? What makes this time any different?

Well today the government (i.e. tax payers) will subsidize a good portion of health care

As a European, I'll tell you that is a great thing.

Without the bargaining power of large groups of employees, how will reasonable costs and levels of service be maintained? It's well established that people on their own without insurance get charged much higher rates than people with insurance get charged for the same procedures at the same hospitals. Presumably the same effects apply to individuals trying to obtain a price for insurance versus an employer bargaining for a group of employees.

Seems to work ok in many places around the world and in different products within the us. You don't need 'group buying' for auto or home insurance, or car or home purchases.

In fact group buying probably hinders the ability to get the right product/person match.

Of all the problems to solve, it seems pretty easy. Even if that just means groupon for benefits.

I'll bite. Where are these "many places around the world" that have your desired laissez-faire approach to health care? Are you talking about places like India or what?

Also, I would hate to see a health care system as badly managed as Groupon.

I live in Australia. I have private health insurance. It's an old policy from when I was employed with a package. The policy costs no more than when it was part of that package. That's maybe because the policy is priced based on me (age mostly) rather than the employer. I'm not 100% sure why there's no real difference between employer based policies and personal policies.

Anyway point is the problem is solve able.

I'm just getting this from Wikipedia, but: "Health care in Australia is universal. The federal government pays a large percentage of the cost of services in public hospitals."

I would happily have Australia's solution in the US. It would go much farther than Obamacare.

My group policy cost more (~60%) working at a corporation than my paying for it on my own - because they are averaging costs for everyone.

Are you sure you're making an apples to apples comparison?

>The way forward is to get rid of the concept of 'benefits' packages and just let people work for a gross pay and let themselves choose their own benefits from that.

Well until you change the tax laws any such change is just going to result in a pay cut. The whole reason things like healthcare are offered as benefits rather than straight salary is because benefits are tax efficient.

>Ultimate flexibility is what efficient economies are about. Unions don't like that future and understandably try and fight it. It's a futile fight in the end.

Sure get rid of the unions, but let employers band together in trade associations. I am sure that these employer organisations would never collude to hold down wages.

Edit. It is good to see that everyone here has forgotten about all the big tech companies banding together to hold down tech wages.

I agree with you I think there's too much idealism in here and not enough reality.

For example this: > The way forward is to get rid of the concept of 'benefits' packages and just let people work for a gross pay and let themselves choose their own benefits from that.

is the quickest way to lose all your benefits and gain nothing... why does he think corporations are really nice caring people who will give you a little extra pay for losing the mandated benefits, and not simply cut the benefits and keep the pay the same? Anything not mandated is optional, and if it's optional the employer doesn't have to pay it and more than likely won't.

From another comment in here, I think this is the result of his flexibility:

Most "associates" (your average workers) get 30 hours/week and zero benefits, except when mandated otherwise by law.

Even if companies wanted to do the right thing and keep the overall pay constant (history would suggest otherwise), because of the way benefits like healthcare are treated by the tax system, getting rid of benefits would make all employees worse off - basically more of your income would go in tax. I don’t think this is an ideal outcome.

> Even if companies wanted to do the right thing and keep the overall pay constant

It has nothing to do with what companies want. They don't pay an employee $X because they like to get rid of money, they pay $X because if they offered less that employee would go elsewhere and they would have to settle for a less productive employee, or none at all.

Actually it is a bit more complex than this. There is a lot of stickiness in wages, but ultimately all wages are set at the margin. Assuming an efficient market then any change from tax efficient benefits to straight salary will result in an effective cut to the employee.

You misrepresent my argument. It's not about stripping people of benefits, it's about not forcing contractors to become employees. Paying a gross salary and letting the person choose their own benefits from that is better for all involved. If someone wants to be tax efficient for retirement contributions, vehicles, whatever, then let them do so. Others may prefer to claim all their income and just pay the tax.

Separating the makeup of compensation and benefits is separate from organizing to negotiate for higher pay. You do t need a permanent union to organize for benefits.

No you don't need a union, but when the group you are negotiating with is in a union (trade association) and you aren't then you might find yourself at a major disadvantage. You are not in a strong position to argue for benefits or salary on your own.

Unions are neither all good nor all evil. They are one way that employees can gain some leverage in the negotiation process. If they didn't make sense then companies would certainly not form their own to argue for their interests.

I should mention that I am an employer not an employee.

Still not understanding me. Currently the union might bargain for employment benefits. This is antiquated and treats all employees as though they want the same things, which cannot be true. Why would you collectively bargain for things that each person values differently?

So it's better to agree to a rate of gross pay, and get paid as a contractor. The individual can then choose what benefits to award themselves, whether it is a higher level of healthcare or retirement payments, or just take the maximum up front income and pay taxes accordingly.

From an employers point of view, a whole piece of headache goes away if the people you pay sorts out their own benefits packages.

The Orignal article is about trying to reclassify contractors as employees, and do so in the name of 'benefits' as though contractors can't get the benefits themselves. Well, that's simply not true.

Whether you organise for higher pay is another thing, and you can form a union to do that, or not.

Actually many unions argue for flexibility of how their members are paid - it is the overall pay that is important.

Once you have settled on a gross pay, how it is paid needs to take into account the tax system. In the case of some benefits it is better for the employer to pay since the effective tax rate is lower.

The whole issue of contractors verse employee is quite complex and even from a employers perspective it is not clear cut that one is better than the other in all cases. I think we can agree that in general it is best if people have the maximum flexibility possible without creating external costs.

I don't think this is the best idea in terms of solving the labor problem. It's more likely we need to make it easier for workers to form cooperatives and/or unions to minimize the excess economic rents on labor. That way, the workers can economize better in terms of healthcare or anything else really. Benefits is just a stop gap that should've been replace by better wage regulation or worker owned businesses where a worker's daily wage doesn't come below their cost of living (housing, healthcare, and food being the core line items in it).

As someone who loves Uber and who spends thousands of dollars a year on their app, and as someone who dislikes Hillary, I cannot be happier with Hillary's stance.

Uber will remain here and their rides will stay cheap. I am, however, very concerned about their drivers. Many of them are making huge investments purchasing new cars with the implicit (and sometimes borderline explicit, depending on the marketing rep you talk to at Uber) that they can have guaranteed work and a guaranteed wage. If über decides to cut driver wages in half and pocket the profits, drivers will be out of luck. This can be catastrophic for poor families, which will be basically be forced into wage slavery. This will have huge effects on the community as Uber gets bigger.

We can all point to how Taxi unions and their lobbyists are evil (as a colored man, it's difficult for me to get picked up by one), how awesome Uber is w/ their investments in autonomous cars, and the free markets are great...but we need real employee protections in this country.

We need real protection for drivers who are making a huge investment. This doesn't have to hurt consumers either, as über can still remain insanely profitable while maintaining lower prices.

Edit: Removed the umlauts

First, it's Uber, not Über. Then we should all have a reality check. All this sharing economy thing has gone a little bit too far now... It's masquerading as a revolutionary way to earn money for everybody except some greedy unions and lobbies that need to be "disrupted", and we don't see that it's just undercutting by spreading costs in an anticompetitive way. But much more important than that: the jobs they "create" are extremely weak, unprotected and they contribute to erode the middle class even more, all while centralizing wealth toward the top 1% that actually funds this sort of ventures.

I really don't get what's so revolutionary in all the services where "sharing" actually means "exploiting lower middle class people's free time or temporary unemployment to provide a service without giving any warranty for the workers, providing cheaper services for the upper middle class".

I understand and support those services where "sharing" keeps its real meaning. Like in car sharing or bike sharing, where you actually SHARE a car or a bike, and not someone else's cheap time.

I am not sure if uber has the umlauts.

While I am not great supporter of the taxi industry, I do think that you should not be too hard on the taxi drivers for not picking you up although I do understand your personal frustration. I am not sure how many uber drivers would be happy to pick up random people without knowing they had been pre-screened.

Yeah, I stopped caring about how taxi drivers treat me. Ironically, it is because I can use uber now :)

As a good passenger you want a way of being able to tell the driver this. Uber lets you in effect do this, but there is nothing stopping the taxi industry copying the same process. If they did they would give uber a real run for its money.

Hillary sat on the board of Wal-Mart from 1986 to 1992 and there aren't many places that exploit their workers much more than they do. It would have been nice if she had done some campaigning on behalf of workers back then.

She's not campaigning for workers now, either. She's campaigning on behalf of lobbyists whose broken business models are being threatened by Uber and their ilk.

That was back when Sam Walton was alive and pushing Buy American. Walmart went to shit after he died.

Was it actually better for workers back then? As far as I ever knew, they've always had a habit of squeezing everyone for a little more every year and whatnot. Most "associates" (your average workers) get 30 hours/week and zero benefits, except when mandated otherwise by law, with ridiculously strict timing on things like breaks. Heck, they even specifically manage the number of cashiers to ensure that there is always a line as long as they have customers... even at 3 AM in the morning.

And that's without going into all the random horror stories, like the workers locked inside doing inventory and unable to get someone to an ambulance, e.g.: http://www.nytimes.com/2004/01/18/us/workers-assail-night-lo...

I worked at Walmart when I was in college because they paid the highest wage in town. No joke, every other offer I received was minimum wage.

It's not glorious, and it would definitely suck as a a career, but at the time it was the best unskilled work available. If Walmart employees had better alternatives they would take them.

Yeah, I've been in that kind of a job before too. I don't think you're arguing otherwise, but I would just point out that 'best job available' and 'horrifically exploitative' are (sadly) not mutually exclusive traits in my experience based on jobs I've worked.

"sharing economy" sounds so much friendlier than "contractor, no workplace protections economy"

Labor market flexibility is one of the great strengths of the US economy. It's one of the reasons why unemployment is back to reasonable levels even after the Great Recession. The freelancer economy has some downsides but in aggregate it's a good thing, both for workers and the economy as a whole. The opposite end of the spectrum is the labor market regulations in a country like Greece, which has always been a drag on their economy (even before their debt crisis).

Anyway, this is a great opportunity for the Republicans to paint themselves as the party of progress and technology, though they need to clean up some of their backward views (climate change, etc.) before such a claim would be credible.

The NY Times had a somewhat more balanced article about Hillary campaigning against Uber: http://www.nytimes.com/2015/07/13/business/rising-economic-i...

It would be fine if the price of housing, food, and healthcare weren't so far out of sync with the wages earned. This is going to lead to a permanent underclass where people are worse off than even serfs of the medieval period.

...so instead of refactoring your law so that contractors have the same social benefits as "full-time employees" instead, she wants to turn the contractors into more easily controlled full time wage slaves.

I really hope you Americans don't vote a president with such twisted logic! ...imagine how this warped way of thinking would be manifested in international politics

I happen to agree that there needs to be a better understanding.

Personally I believe that ultimately we'll just expand unconditional basic income via a welfare state one way or the other, and people will choose to work if they want to. But until that happens...

It would be a good idea to define the difference between a marketplace that connecta people and one that sets the terms without the two sides having input.

Once again centralization causes the heavy hand of the central party, whether a marketplace, buyer or provider.

David Plouffe, Barack Obama's 2008 presidential campaign manager (the guy who orchestrated Hillary's upset in the Democratic primary) is now the SVP of Policy and Strategy at Uber. This could get personal.

This is why we have campaigns. We get to see the cadnidate's logic across a wide spectrum of topics.

This is practically a deal killer for me and Hillary. I think that W2 employment is a dying model. Piecemeal 1099 work empowers every participant to have clear and direct economic benefit and takes the power away from corporations to exploit labor with manipulation about how incapable they are to function independently. They rob the individual of identity, forcing membership in the ranks of the company as a sense of self.

Instead I think work will be distributed, scalable, and coordinated with great software. I think that work will happen based on real-time pricing and presence. I think that means having skills and a good reputation means you can always work when you want as much or as little as you want as long as you actually produce.

I hope that said great software isn't owned and operated by a for-profit institution, but instead is a community-driven, decentralized tool. I think this would pave the way for as close as possible 'frictionless' marketplace where the value of things and people's time are based on the value they bring, not based on slick sales tactics or lobbied regulations.

I seriously believe that government needs to empower and support independent work, or face a slow, 'Snow Crash' style extinction when mesh coordination brings about digital voting, etc.

I get a sense that Hillary will in many ways enforce the status quo and that simply isn't the kind of leadership that we need as we approach 2020 and all that comes along with it.

Uber is a great service and a great idea. However, they encounter many legal problems. I am not surprised that Hillary Clinton wants to move this industry... a bit like the French government does.

CharityWatch says even a “minimally efficient” foundation spends 60 percent of its budget on programs. In the years 2009-2012, the Clinton Foundation devoted just 15 percent to charitable grants, according to an analysis of IRS filings by The Federalist. That fell to 10 percent in 2013. Forty-five percent was spent on salaries, perks and travel for staff.

http://www.realclearpolitics.com/articles/2015/05/31/clinton...

Hiliary Clinton can be bought and is being bought through donations to her foundation.

Regardless of what you think of the issue, that read like a Wall Street Journal Op-Ed. I know Techcrunch skews pro-tech, but at some point reading articles like that increases your filter bubble and ends up with the reader worse off. Instead of understanding WHY people feel so strongly enough about the issue that it's a political issue, a reader just hears essentially a diatribe of why Hillary Clinton is wrong and Uber is great...

Again, no judgement on whether or not Uber is great or HC is wrong, just a concern that articles like this enhance the SV echo chamber to our own detriment.

   Uber should have to follow the same laws that other taxi companies have to. I don't agree with the monopoly systems that are in place for taxis in most cities those should be removed. But at the same time many of these laws are so that taxis are available not just in the peak period but other times as well. So laws that force taxi companies to have part of the fleet available at all times should be also be enforced on uber and other such companies as well.

I know my opinion won't be popular on HN, but looking at uber, especially, and similar companies from the outside (American living in Europe the last 6 years), the u.s. appears to be in a race to the bottom, with people competing to lower their own wages.

I like uber but I think they f*cked themselves over and deserve every bit of scrutiny they are getting. There are markets where they don't screw over the drivers, for example where I live in Zurich uber is the same price as a cab but it's more convenient because of the app.

If uber was truly beneficial to their drivers in the u.s. They wouldn't be under this scrutiny. They deserve whatever pain they receive and hopefully someone more responsible will take over the market.

Good luck fighting the political class. Uber will lose this fight.

> I like uber but I think they f*cked themselves over and deserve every bit of scrutiny they are getting.

I guess I don't get the vitriol here. If the Uber drivers had any better alternative, wouldn't they do that instead? Isn't the worst part for workers rights that they don't have a better alternative? But I don't see how that's Uber's fault, they're clearly providing what many people feel is a useful source of money (they reportedly have over 1 million drivers).

> the u.s. appears to be in a race to the bottom, with people competing to lower their own wages.

It sounds like you're blaming Uber for a poor US job market. That seems unfair. Wouldn't it be better to point the blame at literally every other company who is not providing as good of opportunities? Why point the finger at what appears to be one of the best options for lots of people? I'm sure they could improve the situation, but I'm not sure I understand why they'd be singled out (given what I've seen they'd be one of the last I'd point at). We can lament the fact that there aren't lots of opportunities for lots of people, but I guess I just don't see how it's Uber's fault that they happen to provide one of the most compelling options.

> They wouldn't be under this scrutiny

They're getting the scrutiny because of lobbying & taxi cartels, not because of poor mistreated drivers.

Uber will fight the laws for at least a couple of years and by then be half way through replacing the entire labor force with autonomous cars. This is a political tactic designed to get Hillary points in the media. She's smart enough to know it'll have little to no long term impact.

Frankly I'm surprised she picked uber as a target as uber has a very strong, large, and sophisticated political lobbying organization. Granted, they focus on local politics more than national, so maybe this is a sign of Hillary being out of touch with the local level.

I don't think we'll have autonomous cars in 2 years.

"A couple of years" is not even close to halfway to the time when autonomous cars will be available, convenient, and able to handle the traffic situations that Uber drivers do.

As a rider, Uber has improved my life substantially. A lot of startups claim to better peoples' lives, but how many actually do it? If Uber is destroyed to feed the schadenfreude and ideology of some groups that indicts the political system.

> If uber was truly beneficial to their drivers in the u.s. They wouldn't be under this scrutiny.

Isn't this the wrong question?

I should think the relevant question is, "is Uber beneficial to society as a whole?" It's entirely possible that drivers would be better off without Uber but that society is better off with Uber.

Do you really think taxi drivers prefer to work with Uber because of lower profit? Like masochists?

Actually, your opinion is unfortunately very popular on HN.

Just the other day someone posted a link about the "sharing economy" job of pretending to be a girlfriend. The service is promoted as a way to convince others that you're getting some.

In reality is is used for many things, for example the author's "boyfriend" wrecked his car and needed someone to talk to.

However the author found that she earned about one dollar per hour. The crowdsourcing company that she worked for points out that, as its workers are independent contractors, it is not bound by employment laws.

I hasten to disagree but that's what the company actually says.

I see the sharing economy as the problem not the solution.

Hillary never needs to use anything like Uber or Airbnb.

Whether sharing/contract economy is good or bad, it is a complicated issue. Why would we need a president pretending knows everything?

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