The necessary desperation

Perhaps it says more about my Twitter bubble than anything else, but I’m seeing a lot of desperation in my feed. People feel betrayed even by the looming $1,400 pandemic payments—they say it should be $2,000 and, pointing to promises made in the Georgia U.S. Senate runoff,^[1] they aren’t buying the $600+$1,400 argument (the Trump administration had sent out $600 payments because that’s what it could get out of Congress^[2]). They say that pandemic aid really should have been $2,000 or even $3,000 per month, at least for the duration of the pandemic, and really as a permanent basic income. They are, of course, also incensed that a long overdue and also-promised move to raise the minimum wage to $15 per hour failed.^[3]

But even so, apparently not enough folks are so desperate that they’ll go to work driving for Uber and Lyft. A Wired article sums up the conundrum:

Unemployment in the US remains stubbornly high at 6.3 percent. Job growth has stalled, with 9.6 million fewer jobs in January than the same month a year earlier. But gig companies say they’re having trouble finding people to drive, pick up, and deliver for them.

“I’m worried about one thing going into the second half of the year: Are we going to have enough drivers to meet the demand that we’re going to have?” Uber [chief executive officer] Dara Khosrowshahi told an analyst last month. DoorDash chief financial officer Prabir Adarkar called the situation “a tale of two cities,” with hordes of new customers racing to order takeout but fewer drivers offering to deliver it. DoorDash orders more than tripled in the last part of 2020, compared with the same period a year earlier.

The looming driver shortage confounds executives’ predictions. “With record unemployment, we expect driver supply to outstrip rider demand” for the “foreseeable future,” Lyft CEO Logan Green said in May. For a time early in the pandemic, Lyft blocked new drivers from signing up. It was understandable, because today’s tech gig companies were born during the Great Recession. They benefited from a deep pool of workers newly outfitted with smartphones and suddenly in need of supplemental income.^[4]

It seems that government aid, that same aid that so many in my Twitter feed deride as a pittance, has been enough to keep drivers off the streets.^[5] And indeed, I’ve been pretty busy throughout, though I’m driving a lot more miles on appalling Pittsburgh roads for these rides.^[6]

It certainly doesn’t help my self-image to know that, while I’ve been stuck driving for these companies pretty much since I finished my Ph.D., most people have options. Even in a devastating recession. Options I don’t have, even with that Ph.D.^[7]

But what we also see is that the gig economy—really capitalism—depends on worker desperation:

Gig companies say they’ve felt the impact. A spokesperson for Uber says the company’s data suggests that its number of drivers available fluctuated according to unemployment insurance policies. When the stimulus hit drivers’ bank accounts, for example, fewer signed in to work on the app. [Prabir] Adarkar, the DoorDash [chief financial officer], told investors last month that “on the one hand, you would have expected a large influx of Dashers as a result of heightened unemployment. But that was offset to some degree by stimulus checks.”^[8]

Relieve that desperation, even a little, and workers stay away. So if market economics work the way they’re supposed to work, workers should be able to demand a higher wage, right?^[9]

According to executives’ comments, driver supply isn’t likely an existential issue, at least in the long term. It’s also pretty simple to solve. “As a labor economist—which I am—the market response for employers who have difficulty recruiting workers is to pay higher wages,” says the New School’s [James] Parrott. There’s some anecdotal evidence that that’s happening: Drivers in some cities—including Indianapolis, Oklahoma City, Pittsburgh, and Sacramento, California—say they’ve received emails and notifications from gig companies offering one-time bonuses if they sign on and complete a few trips. Lyft said last month that it would spend between $10 million and $20 million more this quarter on driver incentives, after cutting its recruitment costs by $15 million at the end of last year.^[10]

These are one-time bonuses, not higher wages.

And when, recently, I wound up in the Akron area, where Uber won’t let me drive, but Lyft will,^[11] and I turned to the latter app for the first time in months,^[12] I was stunned by how little I grossed, even relative to Uber, even driving around like a chicken with its head cut off (which is also pretty much what I’ve been doing for Uber).

A raise in the minimum wage would not directly influence the income that gig drivers receive. This, with other benefits of employment, is the point of the independent contractor scam. Such a raise would only further exacerbate the discrepancy between employment and gig work.

But I’ve seen bosses absolutely revel in the power they hold over workers. The power relationship appears in myriad ways, from having everybody jam the roads to be in the same places at the same times, to low wages, to abusive conditions. It really isn’t just the money, though that’s surely important.^[13] It’s about a rush—one boss I saw even pointed to his erection, yes, that kind of an erection, through his pants—from the power to jerk workers around, a power that stems from worker desperation. And it’s hard, if not impossible, for me to separate that from the wages that gig workers do much more than earn.^[14] Politicians reflect and reinforce this power relationship with their rush to reopen the economy even in a pandemic even as to do so threatens people’s lives, in the paucity of economic aid for the unemployed, and in the treatment of workers they enable while doing so.^[15]

With a political system meant to protect the rich from the poor,^[16] and that accordingly institutionalizes a persecution of, rather than sympathy for, the poor,^[17] folks in my Twitter feed can expect to wait a long time for the relief we all deserve.

1. ^[1]Claudia Grisales, “Senate Control Likely Decided By Fate Of 2 Georgia Runoff Races,” National Public Radio, November 7, 2020, https://www.npr.org/2020/11/07/932068951/senate-control-likely-decided-by-fate-of-2-georgia-runoff-races; Jeff Stein and Erica Werner, “$2,000 stimulus checks could become a reality with Democratic control of the Senate,” Washington Post, January 6, 2021, https://www.washingtonpost.com/us-policy/2021/01/06/georgia-election-2000-stimulus-checks/↩
2. ^[2]Natalie Andrews and Andrew Restuccia, “Trump Signs Covid-19 Aid Bill Averting Government Shutdown,” Wall Street Journal, December 27, 2020, https://www.wsj.com/articles/trump-signs-covid-19-aid-bill-averting-government-shutdown-11609117841; Mike DeBonis, [Twitter thread], Thread Reader App, December 30, 2020, https://threadreaderapp.com/thread/1344103713741402112.html; Mike DeBonis and Tony Romm, “McConnell blocks Democrats’ attempt to quickly approve $2,000 stimulus checks amid pressure on GOP to act,” Washington Post, December 29, 2020, https://www.washingtonpost.com/powerpost/stimulus-checks-senate/2020/12/29/344fa850-49d9-11eb-839a-cf4ba7b7c48c_story.html; Burgess Everett, “Trump leans on McConnell for $2,000 checks amid GOP resistance,” Politico, December 29, 2020, https://www.politico.com/news/2020/12/29/2-000-checks-sputter-mcconnell-blocks-dems-451918; Tony Romm and Karoun Demirjian, “McConnell says push by Democrats, Trump for $2,000 stimulus checks has ‘no realistic path to quickly pass the Senate,’” Washington Post, December 30, 2020, https://www.washingtonpost.com/us-policy/2020/12/30/stimulus-checks-senate/↩
3. ^[3]Burgess Everett, “8 Democrats defect on $15 minimum wage hike,” Politico, March 5, 2021, https://www.politico.com/news/2021/03/05/democrats-15-minimum-wage-hike-473875↩
4. ^[4]Aarian Marshall, “Gig Companies Fear a Worker Shortage, Despite a Recession,” Wired, March 5, 2021, https://www.wired.com/story/gig-companies-fear-worker-shortage-despite-recession/↩
5. ^[5]Aarian Marshall, “Gig Companies Fear a Worker Shortage, Despite a Recession,” Wired, March 5, 2021, https://www.wired.com/story/gig-companies-fear-worker-shortage-despite-recession/↩
6. ^[6]This has been beating the crap out of my car, raising my maintenance costs, and eviscerating my already paltry income. While it is early in the year, my vehicle costs have so far amounted to 60 cents per mile, not counting depreciation, which I don’t realistically know how to calculate. The Internal Revenue Service is allowing a mileage deduction of 56 cents per mile this year. Driving for Uber and Lyft also beats the crap out of my cell phones and I’ve had to spend some money in an attempt to ameliorate that (I covered a fiasco surrounding this in David Benfell, “On the alleged ‘efficiency’ of capitalism,” Not Housebroken, March 4, 2021, https://disunitedstates.org/2021/03/04/on-the-alleged-efficiency-of-capitalism/). My total costs, not counting the companies’ sizable and difficult to predict “commissions,” this year now amount to a staggering 75 cents per mile for an average 169 miles per day. The appearance right now is that on many days I’m actually losing money. I can only hope that high costs early this year will not be matched throughout the year.↩
7. ^[7]David Benfell, “About my job hunt,” Not Housebroken, n.d., https://disunitedstates.org/about-my-job-hunt/↩
8. ^[8]Aarian Marshall, “Gig Companies Fear a Worker Shortage, Despite a Recession,” Wired, March 5, 2021, https://www.wired.com/story/gig-companies-fear-worker-shortage-despite-recession/↩
9. ^[9]The idea of supply and demand is that prices (or wages) rise, attracting more suppliers (or workers), to a point, called “equilibrium,” where sufficiently fewer consumers demand the product or service that the two are balanced. Should supply continue to increase, demand will fail to keep pace, causing suppliers to compete on price, reducing prices in the hope of attracting more demand. N. Gregory Mankiw, Principles of Economics, 6th ed. Australia: South-Western, Cengage Learning, 2012).↩
10. ^[10]Aarian Marshall, “Gig Companies Fear a Worker Shortage, Despite a Recession,” Wired, March 5, 2021, https://www.wired.com/story/gig-companies-fear-worker-shortage-despite-recession/↩
11. ^[11]In California, this was simple. I could drive for either company anywhere in the state—and nowhere else. The picture in the northeast is more complicated and I really don’t understand the thinking other than that California is geographically a big state. In the northeast, a comparable area covers more states. But why Lyft allows me to drive in, say, Ohio, but Uber does not, remains to me a mystery.↩
12. ^[12]Lyft was supposedly running a background check on me for months and would not permit me to drive in the interim. Uber turned their background check around in less than 24 hours. I don’t know how to attribute this discrepancy other than to sheer caprice.↩
13. ^[13]David Benfell, “A piper needs paying,” Not Housebroken, January 29, 2021, https://disunitedstates.org/2020/12/19/a-piper-needs-paying/↩
14. ^[14]Farhad Manjoo, “The Uber I.P.O. Is a Moral Stain on Silicon Valley,” New York Times, May 1, 2019, https://www.nytimes.com/2019/05/01/opinion/uber-ipo.html; Dhruv Mehrotra and Aaron Gordon, “Uber And Lyft Take A Lot More From Drivers Than They Say,” Jalopnik, August 26, 2019, https://jalopnik.com/uber-and-lyft-take-a-lot-more-from-drivers-than-they-sa-1837450373; Alexa Noel, “Revised MIT Study Says Uber, Lyft Drivers Make About $8 or $10 per Hour,” Points Guy, March 8, 2018, https://thepointsguy.com/2018/03/revised-mit-study-says-uber-lyft-drivers-make-about-8-or-10-per-hour/; Kari Paul, “Uber drivers plan shutdown over ‘poverty wages’ as company goes public,” Guardian, April 25, 2019, https://www.theguardian.com/technology/2019/apr/24/uber-drivers-strike-ipo↩
15. ^[15]David Benfell, “On a baffling presumption of goodwill toward ‘essential’ workers,” Not Housebroken, April 29, 2020, https://disunitedstates.org/2020/04/29/on-a-baffling-presumption-of-goodwill-toward-essential-workers/; David Benfell, “The expendable worker,” Not Housebroken, December 20, 2020, https://disunitedstates.org/2020/07/05/the-expendable-worker/; David Benfell, “The capitalist death cult,” Not Housebroken, December 24, 2020, https://disunitedstates.org/2020/03/27/the-capitalist-death-cult/; David Benfell, “Imagine a malicious elite,” Not Housebroken, December 30, 2020, https://disunitedstates.org/2020/12/18/imagine-a-malicious-elite/↩
16. ^[16]David Benfell, “A constitutional oligarchy: Deconstructing Federalist No. 10,” Not Housebroken, December 20, 2021, https://disunitedstates.org/2020/04/22/a-constitutional-oligarchy-deconstructing-federalist-no-10/↩
17. ^[17]David Benfell, “We are reaping what we have sown,” Not Housebroken, November 28, 2020, https://disunitedstates.org/2020/11/21/we-are-reaping-what-we-have-sown/; David Benfell, “The mysterious expectation that elites give a damn,” Not Housebroken, December 30, 2020, https://disunitedstates.org/2020/08/01/the-mysterious-expectation-that-elites-give-a-damn/↩