I guess, its the government, since people drive for both lyft and uber.
Uber is saying don't do that, instead proposing a new government policy (laws or regulation) of a minimum rate of $21/hour while providing a ride. Like minimum wage, this would be paid by the employer/client, but the government sets a price floor.
Note that how this compares to minimum wage for employees depends entirely on the occupancy rate for the vehicle: if you've only got a fare for half of the minutes in a hour, that's $10.50/hour which is under the 2019 California minimum wage of $12 or $11 for small employers.
Seems to me we have an oversupply of labor of people willing (or needing) to work for pennies. Having a minimum wage isn't going to improve that. It's going to lead to fewer people taking rides, and fewer people being able to become Uber drivers, but slightly better for the ones that can remain drivers. Classic minimum wage problems.
Why don't we make it $30 per hour? or $50? That would be even better.
You assume there are other options without barriers to entry. You’ve learned how to drive uber, you’ve got a vehicle and payments to make - now take a risk on some other gig with a million unknowns?
Now it’s possible that uber cannot shoulder this cost by lowering their margins, and it will pass directly to the consumer as you suggest - but it’s not guaranteed. The fact that uber is behind this suggests that they can shoulder the cost.
That's a bit of stretch. Also worth noting, many of the jobs did not even exist before Uber created a market for it.
> why don't they simply choose not to offer their services to Uber?
Collective bargaining, aka unionizing, does essentially just that, only with more leverage.
So, why don't they choose not to offer their services to Uber? Well, I think they mostly do, eventually.
Once VC money is no longer subsidizing rideshare businesses, I'm not convinced that they will stay in existence in any form whatsoever.
I agree, they could simply choose to starve.
> I'm not saying that in the "cruel capitalist" way
Yes you are.
> Classic minimum wage problems. Why don't we make it $30 per hour? or $50? That would be even better.
Just out of curiosity, what is your wage? Because these "the poor shouldn't get better compensation" comments tend to come from the well off.
What it says is:
"Instead, Uber is advocating for a brand-new policy that would strengthen protections for rideshare drivers by:
Ensuring drivers would earn a minimum of approximately $21 per hour while on a trip, including the costs of their average expenses.
Providing drivers access to robust new benefits, such as paid time off, sick leave, and compensation if they are injured while driving with Uber.
Empowering drivers to have a collective voice with rideshare companies, and the ability to influence decisions about their work."
What are they actually proposing? I see what they want their proposal to do.
This isn't actually $21/hr. It could very easily end up being under $10/hr. Just depends how lucky the driver is.
Are they doing this in only certain areas?
And it doesn't include the gas, maintenance and depreciation on your personal vehicle driven 30-50k miles per year to reach that amount. The IRS estimates those costs to be $0.58/mile, which would reduce the income by between $17,400 and $29,000.
Whatever the future union (that the drivers are asking for) can negotiate.
> Will 21/hr cover costs plus give a living wage?
No it won't, see the article.
> "These petitions are clearly Hail Marys by Lyft and Uber to try to prevent the passage of AB-5, which seeks to codify the ruling established in Dynamex Operations West, Inc. v Superior Court of Los Angeles. In that case, the court applied the ABC test and decided Dynamex wrongfully classified its workers as independent contractors based on the presumption that 'a worker who performs services for a hirer is an employee for purposes of claims for wages and benefits…'"
Uber's proposed policy is somewhere between what those drivers get now (no guaranteed wages, no benefits, no protection from unfair labor practices) and what they'd get as employees under California law.
Their response:
> "'$21 isn’t a living wage for any category of worker in the San Francisco metro area except a single adult or two adults living together,' Gig Workers Rising tweeted. 'What they’re offering is the floor, while hoping to kneecap any efforts to raise wages down the line & create a real union.'"
Maybe SF should ban single-passenger cars and solve this Uber problem once and for all.
https://hn.algolia.com/?sort=byDate&dateRange=all&type=comme...
I've banned this account for now, but if you want to email hn@ycombinator.com with a better username, we can rename it for you and unban it.
I started using Uber and Lyft several years ago in NYC because the taxis were horrible. More than half the rides would feature a driver on the phone, severe road rage, and reckless driving.
Now it seems to have come full circle. Ridesharing is almost as bad as taxis used to be. Some drivers are great, but many are rude and seem to use the roads as an outlet for pent up aggression. In SF, around 1 in 10 are obviously stoned. More are overtired and easily distracted.
So I'm back to driving or public transit. I love ridesharing and would use it all the time if it was safe, but I'm not putting my life or a family member's life in the hands of companies that can't guarantee a competent driver.
> Ensuring drivers would earn a minimum of approximately $21 per hour while on a trip, including the costs of their average expenses
Compare to their blog here[1] where they are much clearer. "[T]he median driver in Seattle makes between $19 and $21 per hour before expenses. A typical expense range is between $2.94 and $6.46 per hour"
[1] https://www.uber.com/blog/seattle/a-look-at-driver-earnings-...
Insurance: 2400 / yr (guesstimate, maybe lower) Miles driven per year: 50k [1] Cost per mile (Incl depreciation) = 0.26$ [2] Cost per year to drive = 0.26 * 52k = 13520 Total = ~$16k per year in post tax earnings.
(Assuming numbers above still work ) Min 21$ / hr = 43,680 Minus taxes = 40,175 Minus driving costs = 24175
post-tax income per month ~= $2k
Assuming a single driver lives outside the immediate SF area, "commutes" to work, and shares an apartment, it's enough to survive. There's plenty of other jobs that pay less, so it seems unfair to target Uber on this number. You can expect to get by temporarily or make a bit of extra cash with Uber, but it's not a long term career for a driver - but I expect most drivers know that already.
[1] https://ride.guru/lounge/p/how-many-miles-do-uber-and-lyft-d... [2] https://bizfluent.com/how-5914430-compute-depreciation-based...
No it's not. That there are worse jobs elsewhere in no way implies these people are asking for anything unfair. Uber got where it is by greedily violating every regulation on the books and now that they are facing these "unfair" unionizers they demand regulation? Please.
[Edit]: I'll add in another source in line with the IRS rate. See AAA: https://newsroom.aaa.com/tag/driving-cost-per-mile/
That has to be more expensive than maintaining sizeable taxi service fleet. No matter how you make it Uber is taking 30-40% markup and letting drivers to eat the extra cost from this business model.
Competition will keep the wages as low as possible so this change must be done at the systemic level so that Uber and all of its competitors have to make this change at the same time. The only forseeable way to do this is government policy.
If they want to give you credits as well, so be it.
I'm sure driving for uber is not difficult, but making money driving for uber is 100% a skill. When to go out, where to be, how long your shift should be, what rides to skip, etc. That's all invested learning.
> Also worth noting, many of the jobs did not even exist before Uber created a market for it.
Their trophey is in the mail. Just because you create a new job, does not mean it's a good job.
> Collective bargaining, aka unionizing, does essentially just that, only with more leverage.
yes! it seems clear to me that uber drivers would benefit from unionizing.
Same thing with maintenance. Yeah, that oil change may have cost $40... but none of it was incurred while on a trip.
For example, "$21 per hour while on a trip" could mean that, if a driver takes a fare 30 minutes out of town then returns empty, they are only paid $10.50 for the hour's work because returning empty was not "on a trip"
Uber circulating a petition to ... urge Uber to do a thing?
Why don't they just do that thing?
Wal-Mart knows that hiking minimum wage would help it kill mom-and-pop stores that it competes with.
[1] https://www.cnn.com/2019/06/05/business/walmart-shareholders...
Also, a high minimum wage for drivers really bumps the value of their self driving car arm.
https://www.theverge.com/2019/8/8/20793793/uber-5-billion-qu...
If it were a sincere ethical position, once again, they would just implement it... no need to make a big deal about it
Such as?
Wow...on one hand UBER is in an existential crisis regarding the status of drivers (employee vs independent contract).
On the other UBER is now passing around a petition in order to give drivers rights (which UBER controls) that are commonly understood to be inherent for contractors. Moreover, a contractor generally has complete control over their work, and UBER by passing around this petition is essentially admitting UBER controls drivers work which is typical of an employer/employee relationship.
They are petitioning to change AB5, because of claimed negative side effects of that regulation on their driver pool.
[1] - https://p2a.co/H9gttWA
But let us suppose that you have developed a reputation for not being nice, if you propose something nice people will think you are being devious, if you send a survey you won't know how many people actually want you to be nice. But if you can get a petition out there then people will think hey, I can force those not nice people to be nice by putting in my two cents. Now you find out how many people really want you to be nice, furthermore then you can market it later - we heard, we responded, and those people all think hey my voice is important and feel good about themselves and maybe feel good about you and think maybe they really are nice after all?
It is a brilliant piece of marketing really, that will of course be taken over by everyone and ran into the ground and poisoned as a method to the point where nobody will believe honest petitions anymore either - but that is years away.
See social networking, see banking, see search engines, see... well, it happens everywhere.
I woulnd't be surprised if Uber measures the attractions/reactions the same way, and in the end of the day delivers in a similar manner.
I don't see how they're going to afford their drivers if they're already blowing 2b on them
or cutting the grass before the unionizing movement gain too much steam
After all, if no one notices good deeds, they don't count, right? It's the currency liberal American runs on, Virtue Signals ... V$.
Not per hour worked. Not when going to a pickup. Not when waiting for a ride. Only "while on a trip". That alone probably means about 1/3 off. Which puts them below SF's $15/hour minimum wage.
Then, Uber counts the entire amount paid to the driver as "wage", not including their renting the driver's car. That takes off a substantial amount.[1]
And if drivers were employees, Uber would have to buy the bottled water.
[1] https://www.ridester.com/uber-lyft-driver-costs-and-expenses...
This is especially damaging to drivers that desire to drive their own vehicles and choose how much they want to drive. The proposed wages are way below what you should be taking home in an area like SF, and you are depreciating your own expensive asset and paying your own fuel and maintenance, auto insurance, health insurance and so on.
The real gem however is this would force drivers to use the rental car program which doesn’t make much sense unless you are driving all week long. It is a way for Uber to control drivers making them unable to reject poor work and working conditions without actually making those drivers employees. As an independent contractor you should be able to turn off your Uber driver app when the pay starts sucking, and go work for someone else at your own discretion. There’s no freedom to do that rolling around in an Uber rental.
The "gig" economy seems to work by offering people a fairly open choice of pay and work. Though Uber could be more transparent about expected earnings.
Paid for time that you're actually online.
If you're only logged on for 20 mins (a third) of the hour - you get $7 min wage ($21 / 3).
While their marketing promotes driving as a fun side gig, their PR defending their labor practices includes supporting families.
It's not surprising coming from corporate PR, but the selective choice of arguments is pretty obvious.
But then again, in a society where the general populace's basic welfare is largely left to market forces, maybe it's not a stretch for corporations to make the claim that supporting families is among their side-effects (but not objectives).
Companies in the US are utterly out of control with regards to paying a living wage.
Am I the only who notice the last 4 words? This will effect very few drivers as most are already making > that "while on a trip (and not stuck in complete grid lock)".
Shouldn’t Uber instead be guaranteeing how much drivers are paid net? If $21 really is before expenses then it’s not even $15 for most drivers after, maybe not even $10?
Also: I was assuming the pay was while working, not while driving passengers. Otherwise isn’t it even worse?
What if Uber instead just guaranteed drivers a living wage plus benefits net?
"California drivers deserve access to flexible work." https://www.independentdriver.org/
I wish rent was flexible. How about food prices, they should be flexible. Car repair costs. Flexible. Gas prices should be flexible. In general life should be flexible. Everyone should negotiate. Things should not be that predictable. It's better for everyone.
I don't know how to interpret this in that context: is this proposal absurd, or is the medical / labor system in the US absurd? (or both??)
A joint letter by Uber and Lyft CEOs: https://www.sfchronicle.com/opinion/openforum/article/Open-F...
Lyft email campaign advocating minimum earnings: https://p2a.co/xcA3Bg3
They seem to want you to make a straight comparison to a W-2 hourly rate which isn't honest.
And of course once they get their monopoly they will raise prices further to get profits and at that point I’d guess they would only be slightly less expensive then Taxis were before all this gig economy craziness.
Regarding a different, recent "olive branch" type proposal:
"The one thing they don’t want to give you is the thing that you need to get. This offer from Uber and Lyft is like a kidnapper offering you a softer blanket, as long as you agree not to ever escape. No thanks. These companies know very well that once their workers become actual employees, they will get a host of benefits automatically, and they can formally unionize to win themselves many more benefits and increased pay. These companies, which have never made a dollar even while exploiting their workers, fear this. So they offer some concessions." [1]
[1] https://splinternews.com/if-uber-wants-it-its-bad-1835514222
This simultaneously reduces the race to the bottom of pricing for ride sharing while capping what Uber will pay at $21/hour[0].
[0] "While on a trip". Gotta love that.
Seems to me that's the starting point before decing whether it's a good wage or not.
It's true that nobody is forcing you to work for Uber. You can always go to one of the other companies inside the same system with the same incentives that cause them to treat their workers in the same way.
One could imagine a world where automation replaces half of the labor force and the free market would essentially allow corporations to rake in enormous profits while the unemployed class gets paid pennies and lives in poverty.
This is not a good deal.
People who claim that regulation only makes things worse should take note of this: even the threat of regulation can be enough to get corporations to at least try to appear to do the right thing.
That said, I think there are two problems with this:
1. Long-term results of this will just be Uber trying to avoid regulation for as long as possible, while figuring out more and more clever ways to maximize profit at the expense of both drivers and passengers.
2. Any payment agreement which doesn't include health insurance in the US needs to be considered as significantly reduced. Back of napkin math ahead: Health insurance can run as high as $700/month and after taxes someone getting paid $21/hour takes home closer to $10.50, meaning some drivers will have to work ~65 hours/month just to pay for health insurance. Assuming Uber drivers drive 160 hours/month (which is conservative), paying for their own health insurance is a ~40% reduction in pay. This means that, pre-tax, that $21/hour looks a lot more like $12.60/hour would in a country with a reasonable healthcare system. Of course, there are some worst-case scenario numbers included here (most people's health insurance isn't that expensive) but at least some Uber drivers, particularly with expensive-to-treat preexisting conditions, are going to be receiving a much lower wage if health insurance isn't included. I suspect this singlehandedly is why Uber is even making the $21/hour offer: as a way to avoid regulation that would require them to pay for health insurance.
Saying "amoral corporation" is almost redundant and isn't specific to Uber--almost all corporations are fairly amoral.
It seems to really be, Uber responds to proposed legislation in CA, by asking for it to be changed to allow uber drivers to remain 'independent contrators' -- but they're willing to take legislation, apparently, that would guarantee a $21/hour guarantee, along with paid sick leave and vacation?
Or maybe they're saying if they don't pass any legislation at all, they're willing to do those things voluntarily... presumably just in CA? I'm a bit confused, the article is poorly written.
This is a lot more than many Uber drivers currently get.
There are people quoted in the article saying $21/hour still isn't a living wage in the bay area.
But if Uber is suggesting that $21/guarantee with paid leave is only fair, presumably they'd be willing to commit to that nationwide, not just in CA where they are threatened by legislation? (Just kidding, I obviously don't presume that).
I know many people who do or have driven for Uber in other parts of the country who would find it quite an improvement to get a guarantee of $21/hour and paid leave.
“drivers would earn a minimum of approximately $21 per hour while on a trip, including the costs of their average expenses.”
"while on a trip", aka "not really $21/hour", because even in extremely dense areas, drivers have downtime between trips, during which they typically have to either drive around aimlessly, find a place to idle/park, or drive to their next pickup.
As many have pointed out, this is the key. Not possible to have 100% utilization, so most drivers would probably earn 50-75% of this number.
wait, is Uber slowly becoming a taxi service?
That seems excessive. Plenty of professions require significant investment in equipment. Many truckers own their own trucks. Mechanics buy their own tools. It's just part of the equation.
I understand that they're "advocating for a brand-new policy that would strengthen protections for drivers" but what is that policy? What policy are they suggesting be put in place to make sure protections for drivers are strengthened?
I delivered pizza's full time for 7 years of my life, so I'm well aware of the toll a job like this can take on your car, but even if we triple the high end to $7500/yr to cover the extra wear and tear, gas, and the extra miles/depreciation they are putting on their car, they are still making a little over $17/hr pre-tax. Additionally, a lot of those expenses are tax deductible which means their take home would be a lot higher that most other people making $17/hr.
There are a few major cities where that wage feels a bit light, but for the vast majority of the country, $21/hr feels like a livable wage, even paying for car expenses.
That part doesn't seem quite right. Maybe they can deduct more than they actually spend (using standard mileage rates) but they'll presumably have to pay self-employment taxes which would offset that advantage.
Right now, Uber offers a rate based on time spent per trip, and mileage per trip. Drivers do not get paid outside of trips.
For example if the trip is 10min pickup time and 10 min travel, Uber might bump up the price to make drivers be more willing to accept that trip.
The IRS sets a standard rate of 58 cents/mile for deduction of vehicle-related expenses. There’s obviously a wide range of actual costs, but that’s in the ballpark for an all-inclusive amount. If you average 20MPH then you’ll exceed $10/hr.
Like is it really cost effective to go to the theater on the other side of town because the tickets are $1.50 cheaper? Or this grocery store versus the other?
Improving society and equalizing society can mean lifting everyone up, not keeping others down.
Is it really insane that people should get paid a living wage, regardless of whether it's a 'skilled job' or not?
If someone were to approach you on the street and ask you to do something for them that will take an hour of your time, what amount of money do you think would be a fair compensation for just the time expense? Now add to that the fact that it's not just an hour of someones time, it's also an hour of use of an expensive machine they own and maintain.
I've found that when minimum wage is thought of in this way, anything less than $20-25/hour sounds absurd.
$3,706 x 12 months = $44,472 in rent.
That's the first number I found on google for "san francisco average rent price" (without quotes).
I agree that those numbers are insane. Accusing someone who makes less than he needs to rent decent housing of complaining seems quite wrong. I understand that San Francisco is at the high end of cost of living. It's also where Uber and Lyft are centered.
The point of the article seems to be that Uber and Lyft support this idea because they're hoping to undermine more meaningful protective legislation, specifically California Assembly Bill 5.
Claiming that this low-ball offer from large corporations would be too hurtful to those corporations, and far too generous to their workers, would be ... insane, right?
When I was driving, I could make abut $1000 a week when working 60 hours.
$150 of that would be gas 35 would be insurance 15 would be oil changes $50 per week should be set aside for savings to reinvest into the vehicle in the form of proper maintenance.
the final number, $750 for working 60 hours 12.5/hr
I think we need to just be smarter about helping the poor. How about we get rid of income tax for people under the poverty level (or multiple there of)? How about we give them some basic income to make up the difference? We can tax more on the high side to make up the difference. Also, giving poor people more fluid income will likely increase the velocity of money which should make rich people richer negating any increased taxation.
The fully loaded rate is potentially much lower.
In my high CoL state, EMTs make roughly $15-$18.75/hr, work multiple back-to-back shifts and often nights.
So this wording is essentially fraudulent.
If you're talking fire department-based EMTs, then yes, but these make up a significant minority of EMTs who are often running on minimum wage and often given the bare minimum of health insurance.
Work out the cost per mile, and the average miles per hour, that number comes down quite a bit. Especially in places where car insurance is higher.
If they're going to be paid less, they need to be compensated elsewhere.
you could have just as easily quoted any other word, "decisions" "about" "their" "work" as those words are not "control" either, but when you put it all together, "influence decisions about their work" that sounds a lot like control.
Contractors are supposed to have control over their work already, if it makes it easier remove "influence" and if you think there is a more fair interpretation of "decisions about their work" lets have it.
Edit: From the proposal: "drivers would earn a minimum of approximately $21 per hour while on a trip, including the costs of their average expenses"
So yeah, it looks like it would only apply to time spent on a drive. I hope it at least includes the time it takes to get to a customer as well. I had an interesting conversation with a Lyft driver a while back who explained that if you're mainly moving people short distances in the suburbs, you're hardly breaking even. It would be neat if a pay structure could incentivise being available in lower-demand areas but I guess we're not there yet
Doctors work hard, and so does my barista making my coffee. But let's be honest: they shouldn't be paid the same simply because they both work hard.
It doesn't take much schooling to become an "EMT". However with what they have to deal with and how essential the services are, they definitely should get paid more fairly.
Sure, we can imagine it, but it would be asinine to take legislative action now when that isn't even a problem.
Yes, but it's not the point - it's misleading to talk about a minimum wage that excludes some time on the job from the denominator.
Yep, I agree with you on this point.
A $21/hr tax-free job minus driving costs is still equivalent to a $15/hr job. It's definitely not equivalent to a $21/hr job riding around in someone else's ambulance burning someone else's gas. And from what I'm seeing, residents make ~$60k/yr. That job is also a stepping stone to a much more lucrative profession.
That’s only if you believe in the fairy tale that Social Security and Medicare taxes (close to 15% including the employer’s side) go into a separate account and that those taxes don’t go into the same bucket as regular tax revenues.
It seems large because we aren’t used to looking at TCO per mile, and only think about the cost of fuel.
The AAA average includes pickup trucks, which hopefully you wouldn't be using for Uber.
Edmunds puts the TCO for 5 years (includes insurance and gas) for a Prius @15,000 miles/year at $30,600. That is 40.8 cents/mile. 59c is 45% higher.
(This assumes you start with a brand new Prius; you may optimize better as an Uber driver)
I expect everyone to be paid a living wage at every full-time job. That's the very definition.
Additionally the Fair Labor Standards Act (for US anyway) does not give any formal definition of "full time" work, and is up to the employer. Only that covered nonexempt workers working more than 40 hours are entitled to overtime.
It's fine to disagree, but at least provide some sort of substance to your argument...
It takes your full job time, it says that there is a measurable amount of job you can have and that it is full with that one. Following that logic, if you fill all of your available job time, there is an assumption (mine and others) that it would provide simply because if you can't, you need more job to do so, making it not a full-time job.
Why would he need a source to back an opinion?
Telluride -> Denver is 360 miles by road. At $0.58/mile that's ~$210.
KTEX -> KDEN is 190nm, call it 2 hours in a Cessna 172 with run-up and taxi. I can't find aircraft rental rates there in 5 minutes of search, but anything under $105/hr wet would make it cheaper than driving at IRS rates.
Telluride is at 9070 feet elevation though, so make sure you know how to fly in the mountains!
Also, yea, mountain training is a must. I wouldn't actually take a 172 up there but a 182 or Archer would be fine in nice weather.
If so, say I have a two hour flight Friday, leave it parked until Sunday, then a two hour flight back. Four hours of flying and 36 hours of sitting. What would the final charge be?
It's crazy to me that they feel taken advantage of, but decide the best option is to try and push down those who are even or below their pay grade, instead of focusing their sights higher at those at the top.
>While any one crab could easily escape, its efforts will be undermined by others, ensuring the group's collective demise.
Unfortunately, that's not exactly how things end up working in practice when it comes to pay because of a pesky little thing called inflation.
Inflation is amazing for debtors as it eats away at their debt over time, which is what happened for baby-boomers who were given the opportunity purchase property on credit during the long post-war US economic boom.
SV's problem is that even the minimum rent is pretty high, but that's a local problem, not a universal.
> SV's problem is that even the minimum rent is pretty high, but that's a local problem, not a universal.
In my experience almost all of people's problems are local.
To be clear, I have an excellent job. I'm just trying my hand at putting the 'ol empathy hat on.
That's hostile misinterpretation. I gave you real-world examples, like roommates.
The proposal suggests to me that they think their customers are not extremely price sensitive but they're also not loyal to a specific supplier. In other words, they'll take almost as many rides even if the price goes up but they'll still go with whoever is cheapest.
It makes sense, if something is cheaper, you use more of it. If its more expensive, you start using substitutes, as the benefits of rideshare gets dwarfed by its extra cost. It’s literal econ 101
If they can establish a regulatory framework that favors them (Uber), they can raise prices as competition is further restricted, to more than offset the $21 / hour. Their ideal has to be to establish that favorable competition environment, enabling considerable price increases that get them closer to profitability (ie exceeds the wage cost increase by a large margin). In the current situation, Uber is facing a bankruptcy scenario with their low sales growth, extreme burn rate and with a competitive market where they can't freely increase prices. That tells you what their goal has to be.
If they were certain their customers were not price sensitive, Uber would have already spiked their pricing far higher to push toward profitability.
If you're not swapping cars ever few years depreciation per mile is basically irrelevant because age and what you use the vehicle for will dominate depreciation.
Edit: apparently you can, and drivers leasing new cars to drive are getting creamed.
But if it will make you feel any better, the same argument holds for pediatrics residents, who will go on to make an average of about 135 after their decade-plus of training and loans.
Getting paid equally for both of those positions, regardless of future expectations, indicates that something might be off.
Think of it like grad school cranked to 11. More hours, harder entry requirements, bigger stipend, massive payoff at the end.
If you are part of a flying club (everyone buys in for a few grand and own x% of the aircraft) then the rates are typically said to be "dry" and are just the aircraft without fuel and typically billed with "tach time", or the engine clock rather than airframe time which measures rpm / max rpm * time which is in practice about 0.8 * "hobbs" making it slightly cheaper for some operations. Flying clubs vary a lot but are typically more lenient and often don't charge a minimum for overnights as long as you aren't abusing the heck out of it (ie. fly an hour away, spend a two weeks, fly an hour back).
Do you have a source for that? I find it a bit hard to believe, given the decline of mom-and-pop stores in general.
https://www.nytimes.com/2014/08/15/us/starbucks-to-revise-wo...
[1] https://www.epionline.org/oped/who-really-employs-minimum-wa...
"Some of these businesses are small diners or independent grocery stores; others are franchisees that own a handful of stores affiliated with a recognizable brand. (For instance, over 80% of McDonald’s locations are owned by franchisees.) In either case, the profits and executive pay at the country’s largest businesses have nothing to do with the stark economics these small-business owners face: single-digit profit margins."
If over 80% of McDonald's locations are owned by franchisees, then it's likely that MANY of these are franchise-related (also, profits and executive pay at McDonald's would certainly have something to do with the related economics of franchise fees and the back-end of the supply chain).
It's not, and shouldn't be, an emotional argument. It's an economical one.
There are many ways to cover your basic needs that don't require you to live on your own in a one-bedroom apartment and three square meals a day. In fact, most of humanity survived by pooling resources. The ability to live entirely on your own being common is a very recent phenomena as is three square meals a day.
All your stating is that people shouldn't have options where they can pool resources. As someone supporting two older adults in my household, you're saying that if they can't get hold a livable wage jobs (unlikely given that one has Parkinson's) but still still could earn money and contribute to the household. You've not made my circumstances harder by legislating away opportunities for them to contribute.
If a job pays less than the cost of living in an area, then the job is somewhere between subsidized by the government or not economically viable.
Many/most Uber customers would use a materially cheaper equivalent service if available because the switching costs are low.
However, that's not the same as price elasticity (of demand) which is what the term usually refers to. Price elasticity is about how much less they'd use any price-competitive service as the price increases.
I'm honestly not sure what that curve looks like. Within reason, pricing wouldn't affect my usage much at all. But I'm a light user of these services and use them almost entirely for business. Certainly I'm a very different profile from a young urban professional who doesn't own a car.
ADDED: Between surge pricing and other pricing experiments I'm sure they conduct, I would imagine that Uber has a pretty good idea of what demand and driver supply curves look like.
And that is, in fact, insane, as it's contrary to the experience of anyone who has worked two jobs, shared a flat, budgeted, or otherwise been creative in making ends meet.
"Nuh uh, some people have been creative and survived under the current system!"
"Nope, because we care so much, your lifestyle is illegal."
Why can't that be a job you do on the side for a little extra cash on the weekends? Why does every job need to provide a "living wage"?
There was an article posted on HN a while back where they said the average franchise owner makes around $40K a year - and that’s with them working 60+ hours a week. Where is the money suppose to come from?
Usually when I ask this question, I get the response that those companies don’t deserve to exist. Which is saying a lot considering how many people on HN probably work for a money losing startup living off of VC funding.
So far the losses have been very privatized (VC and bank money) and if anything the gains have been socialized (the general public has benefited a lot in the form of taxi-like transportation, airport rides, etc. getting phenomenally better in most cities where Uber exists).
Yes, they lose some volume but Uber/Lyft is probably a pretty strongly engrained habit for many at this point.
When I've looked, it's appeared as if Uber is only marginally viable around where my house is. Decrease the number of riders and I could imagine the number of drivers dropping further to the point where it's not really a usable service.
Might be true in the valley, but I see no reason to believe that this is true in many other markets.
Any conclusion you come up with is completely subjective, and might fit for some people, and might not for others. Maybe someone's full-time job is someone else's part-time job.
Draw the line wherever you think it should be drawn. Their argument is still true. The argument doesn't change whether full-time is 25 hours or 75 hours.
Every single adult working whatever society agrees is "full time" should be able to live comfortably on those wages.
I agree that would be nice, it's just not possible in a free market. Is there any country where everyone lives comfortably working full time at any job?
What sort of employee rights is the US lacking?
Why do you think people have this ability and choose not to use it? Do you think they're all too stupid to think of it?
I can speculate but I couldn't know everyone's reasons. Employment is a contract, and people are free to either terminate it and find a new job, or negotiate the terms on getting hired. There will be consequences, presumably you may not get paid as much, or get promoted over someone else but you can still work a livable wage.
> Do you think they're all too stupid to think of it?
I don't think people are too stupid, I'd guess maybe they feel peer pressure to do it if others around them are doing the same thing.
How many companies can afford to pay 21$/hr minimum for example?
So somehow it's both a great step forward and terribly anti-competitive at the same time.
Case and point: Uber was basically a (hugely popular) mediator for illegal cabs in my country. They had to shut down, but as a response the government introduced new vastly relaxed regulations to the whole taxi industry, setting the rules under which services like Uber could operate. I am not yet sure if it will actually result in lower rates, but at least they catalyzed a historical change.
Thanks.
Then, transit will cost exactly what it should cost, and we can lower taxes as well.
Won't even have to do that, wait for inflation to take hold (I believe inflation is very likely to explode in the next few years) and just ride it out.
Why?
1. Money is essentially free at current interest rates and I don't see a sign of that reversing course.
2. Large firms are hording cash and have more than they know what to do with. They are at the point where they are buying their own stock because that is the most productive thing they can do with that money.
3. The democratic party is running on minimum wage increases. While it is debatable if that will have a huge impact it certainly isn't a deflationary measure.
4. Democrats are also running on the green new deal, universal income and medicare for all that I predict will not actually result in higher taxes for the wealthy in any meaningful way but instead the printing of money in order to fund those programs as that is what seems to happen every time. Even if taxes were implemented as discussed, moving money from investment vehicles (where the wealthy have it) to consumers will still probably cause inflation in terms of housing and consumer goods.
5. China is sitting on about 3 trillion dollars that is currently effectively out of the money supply and they will likely deploy that as a weapon in the trade war.
Depends how you look at it. If you're looking purely at supply and demand of drivers, it's fine. If you think people working 40 hours a week should be able to afford decent housing and health insurance it's probably too low.
For political reasons that can make sense, it's hard to push for a minimum wage bump right after a different one, but I am unaware of other cab companies advocating for a higher minimum wage prior to this.
It's always hard to say where an idea in a company "comes from". We probably don't mean literally the human being who said it out loud first. Most ideas have been around for a long time before they become policy, waiting for circumstances to change or politics in the organization to favor them. If the politics in an organization favor an idea for a combination of reasons, both ethical and self-interested, it might not be fair to say which reason "gets the credit" for the idea.
https://investorplace.com/2018/07/are-ceos-really-worth-what...
See also: https://www.wsj.com/articles/big-companies-pay-ceos-for-good...
https://www.forbes.com/sites/susanadams/2014/06/16/the-highe...
Healthcare should be provided to all by the government for free, but until then we must live under the system.
A home near me is about 100k for 2000 sq ft main floor. Does that mean inflation doesn't exist?
What a weird argument.
So I don't think it was due to people honestly thinking the average inflation would be .5% but just an idiosyncrasy of how we estimate market expectations of inflation.
Do you believe that when Uber stops bleeding money, and pays an ultimately somewhat acceptable wage to its drives, it will still be able to compete at the new prices set by these changes?
I sure don't.
I responded to this statement, in which you implied that uber had little market share in other areas. No where in your comment did you state that it was operating at a loss, you simply stated you didn't believe Uber wasn't as strong in other markets.
> pretty strongly engrained habit
An ingrained habit and market share are different things. Market share is dependent on price point among many other conditions. I never said or implied that ride share services, and Uber in particular, don't have strong market share. They do at the moment.
Choose one: "yes", "I want to pay higher taxes so independent adults can survive on such a wage via government assistance", "people who work 40+ hours a week so I can eat cheap burgers do not deserve to live", "I would be okay with much slower service and business hours that don't intersect with school days, as well as high local unemployment and probably homelessness."
>Where is the money suppose to come from?
Raise prices or cut other costs. If that doesn't do it, well, perhaps they should listen to you and develop more marketable skills, right? I find it weird that you arbitrarily decided on a "skill threshold" where flipping burgers isn't deserving of a livable wage, but for some reason entrepreneurship is.
So the independent pizza shop owner doesn’t deserve to be in business since they have to actually be profitable but the startup founder who can lose money for a decade supported by granddaddy VC backer does?
And by the way, up until the current administration, every Republican and Democratic administration as well as most conservative and liberal economists has said that the best and least disruptive way to support a “livable wage” for heads of household is to increase the earned income tax credit. I would add make that a reverse payroll tax to make it easier for employers to distribute it to workers during the year. Yes, I’m okay with increased taxes if necessary.
Is he working 40 hours a week? If so, then yes.
Are we better off if he can’t be in business and has to work for someone else?
If Uber unilaterally increased minimum salary, then those competitors would have to do the same, otherwise they would lose all their drivers to Uber. So, if Uber really cared about drivers they would just do it. Instead they are making PR stunt by "demanding" government regulation.
That really helps “equality”...
https://news.crunchbase.com/news/untapped-opportunity-minori...
Heh. I heard it was bad in CA but wow.
Does the pizza owner also deserve an adequate return on investment to make his risk worthwhile or should he also work for minimum wage at a larger corporation?
It's not actually a race to the bottom because it's still a competitive market. Even unskilled people have a choice between being Uber drivers or janitors or stock clerks or fast food workers, or anything else that someone will pay them to do. If Uber pays less than Walmart then people can quit Uber and go work for Walmart. That creates a floor for the pay of Uber drivers independent of anything the government does.
And if the government is going to do something, it's much better to raise that floor, which minimum wages can actually do the opposite of because people have non-monetary job preferences. If a $21/hour minimum wage appears then you have to pay Uber drivers $21/hour, but suppose they have $15/hour in expenses (fuel, wear and tear), so that's really only $6/hour. Meanwhile a work from home job might have paid $10/hour -- a real $10/hour -- but now that's well below $21, so is no longer available. So now you're paying $15/hour to make $21 instead of paying $0 to make $10, which means you make less, and Uber gets to pay $21 when they would have otherwise needed to pay $25 to actually be competitive. And the same thing (to various degrees) with ordinary commute-to-work jobs vs. stay at home jobs, or jobs with longer vs. shorter commutes or in higher cost of living parts of the city or that require some training or other expense that ultimately has to be paid for out of wages, or the job is just downright less of a grind and people are willing to accept less money in exchange for easier work. By removing options people used to have, you only make them more desperate for the remaining ones and require them to accept worse options even if they're better on paper.
Maybe if we stopped thinking of employees/contractors as "labor" and thought of them as people it would be easier to empathize with their needs. Do you think that your friends, family, and loved ones deserve a wage that meets their basic needs? Why shouldn't all humans deserve the same?
The primary purpose of a business is to maximize profits for its stakeholders.
On average, educated people contribute more value to the functioning of society. I can drive myself around. I can't perform my own heart surgery.
The argument that all humans are inherently equally valuable is specious reasoning. I can come up with all sorts of trolly car conundrums that if you were forced to choose, you'd make a value judgement about which person to save because they have more value.
That someone failed to make money on the market doesn't necessarily mean they were wrong, it may just mean nobody gave them a pile of money they could afford to risk.
Now we have a bunch of presidential candidates that tell me they are going to print money all day long and a bunch of people who "know better" telling me that won't cause inflation to spike. ¯\_(ツ)_/¯
It was much more difficult for housing. The Big Short tells a story about how even if you knew housing was over valued it was very difficult to short, and the ones who did almost lost everything.
In the past (pre-Uber), if you made this amount of money by engaging in large-scale, coordinated law breaking, you were called a gangster and got a big old nice RICO charge.
Don't be confused or blinded by the valuation. That is a byproduct of breaking the rules. The rules were not broken because they were unfair - that's a meme - you don't get to pass arbitrary judgement of which laws you do and do not respect (in theory). As a business, if you do not like the legal environment (rules) of a certain location, the logical (and respectable) choice is to not operate in that region/location.
My view is 10x more harsh on companies breaking the law in a coordinated manner than compared to an individual person.
Thank goodness it was only in theory. The taxi industry was and is terrible, the only thing propping it up is regulatory capture.
> As a business, if you do not like the legal environment (rules) of a certain location, the logical (and respectable) choice is to not operate in that region/location.
As a consumer, I'm glad that the rules were systematically broken in a way that benefitted everyone except the taxi industry.
I can definitely get aboard the taxi hate train, but do bear in mind that there has been a higher incident of sexual assaults tied to uber drivers over taxi drivers - it's not a free win for everyone, they broke both rules intended for regulatory capture and those intended for public safety.
These are good times for the consumer, but of course the situation won't be this way forever.
Ridesharing is more convenient, safer, cheaper, and more environmentally friendly. There's less idling, less aimless driving, less congestion, more carpooling, no clumsy exchange of cash or credit cards, the reputation of drivers is visible, and the ride is fully tracked so your whereabouts are known.
This is really problematic for me. If you restrict the scope rightly to only democracies that are truly representative (which many regulatory capture environments are not) I might be able to agree. But many governments in the world are not nearly legitimate enough to deserve this respect.
I have no issue with individuals, businesses, revolutionaries and other for profit or not for profit companies trying to undermine the dictates, decrees, laws or rules or whatever you want to call them of oppressive or authoritarian governments.
Taken to a logical extreme, this justifies for profit companies supporting and entrenching dictatorships, under the excuse of “we were just following the law”.
Laws are the social contract that we've all agreed to - I am totally in agreement that a lot of laws were created through corrupt government action, but giving free reign to any private entity to ignore laws they find onerous pretty much removes lawful society.
Even then I cannot. The majority can be wrong at times and a bad law, even one with majority support, is a bad law. In such cases the only value to following such a law is to reduce risk of enforcement (and there is plenty enough evidence that following the law is no defense against being harmed by those who enforce the law).
I am sure you can dig up illegal acts, but the secret sauce was the new dynamic that bent what people thought was possible at scale.
I'm thinking this isn't actually true. In some cases you definitely were. In others, you become the dominant player and enjoyed becoming wealthy.
What exactly divided the former from the latter? I wish I understood that better.
I'd say that's firmly on the "breaking the law" side of things.
I think most people consider onerous regulations to construct a barrier against entry aimed at any new market entrants[1] to be a different sort of law breaking than normal law breaking (more... morally and ethically acceptable). IMO Uber has flagrantly ignored a number of regulations regarding driver background checks that have allowed it to become less than safe to ride in, especially for single women, there have been a plethora of stories about women being stalked by uber drivers - even within the water-cooler talk at my office.
So technically they've broken a bunch of laws - and ethically they've acted in bad faith.
1. Please note, I think what regulations would be in this group varies extremely across HN, with the more freebretarian folks placing all regulations here, while others may consider labour regulations or environmental regulations to provide real value - and I really don't want to get into this discussion, I just think we can all mentally place a line _somewhere_
Regulations are enforced by regulatory bodies that operate under a different legal basis than civil / criminal law. Regulatory bodies are not legislative in nature but rather executive. Being sanctioned by a regulatory body is a very different thing than getting prosecuted.
For one, a regulatory body does not enjoy legitimate use of force, and cannot imprison individuals. They can only sanction according to their mandate. If you refuse to pay a sanction, this may escalate to a prosecutable criminal infraction. But simply breaking regs isn't a crime.
For instance, if you're operating an illegal home-based business, you may be subject to sanction by the zoning authority and the entity that you were supposed to register with. Like the local real estate board if you were providing realtor services without a license.
Only in rare situations is it a criminal offense to provide commercial services without the proper licenses, such as providing legal or medical services. It is not, as you say, the norm.
Even in the case of environmental regulations, rarely are they elevated to the status of crimes under criminal law. More usually you'll get contacted by the appropriate environmental protection administration and fined. I recall hearing about one company who would simply call up the authorities whenever they needed to dump into the river and pay the token fine.
There's a lot of room for improvement.
2&3. Democrats "running on" some policy does not at all mean it will happen. In the current political climate, it's quite likely their holding a position means it won't happen.
4. Large firms have already been using record low interest rates to finance stock buybacks. This has been going on for years. The last three or four years of stock price growth has been fueled by financed buybacks, with every year breaking the previous year's record. At some point will need to stop.
As an aside, these buybacks are likely going to be the cause of our next stock market calamity.
5. This is sort of legit fear, but 3 trillion dollar is not really enough to make a market-wide impact and selling their bonds would just push interest rates lower, serving to help the US achieve their current monetary policy. They could use this money to selectively certain industries though.
And its not just housing in downtown San Francisco, even housing in middle america podunk nowhere has soared
Just look at the M2 monetary velocity[1]. It fell off a cliff in 1997 and never really recovered. It's now at an all-time low. For all intents and purposes we're operating on a light version of MMT.
Some things are scarce resources and should be priced accordingly.
Also, how do you classify “the rich”? People in the 90th percentile of household income? That would be approximately $130K a year.
Finally, only 15% of federal spending goes to the military. Most of our spending is already for social security, Medicare, education, retirement benefits, etc.
https://www.cbpp.org/research/federal-budget/policy-basics-w...
Social security and Medicare are funded directly via payroll taxes, they are not part of he general fund and you pay for them separately. Comparing them is like comparing medical insurance premiums or 401k savings to military spending.
It reduces the incentive to sacrifice other things for additional income once you've already reached the level at which the increased tax kicks in, yes.
Why is this a bad thing?
Also it is my belief that moving money from investment vehicles to consumers will have a inflationary effect on consumer goods. The slow trickle of subsidized Uber rides for example probably has less of an effect than a direct cash transfer that happens more rapidly. More so much of that money is invested internationally, by increasing taxes on the wealthy we may be in effect increasing the total money supply in the United States.
I mean, except for historical edge cases, we have minimum wage and social welfare programs in Germany that can be used to supplement income if it's really not enough to drag you over the poverty line. While it is by no means perfect and there of course still is poverty and people requiring multiple jobs, if you work 40 hours you can rely on full social benefits, pay into your pension fund and at least live some form of life. The US isn't really a posterchild of how to treat employees w.r.t. wages, vacation, health care, ... the question of "everyone living comfortably" seems weird, of course not. How a society handles their poor/low-income earners is no black and white question, there's a huge range between giving corporations free reign and at least trying to improve living conditions for the majority of citizens.
Actually, let's just make the minimum wage $30/hr and everything will be great.
Yes. In my country (NL) the minimum wage, combined with a progressive tax system makes that everyone can live off one job, have health care for their family and education for their kids.
It's not luxery on minimum wage, but it works.
I was probably a bit hasty in asking this question, it's a bit silly.
That being said, I don't know if you can compare NL and US as it's population is 10x lower and as you mentioned has much higher taxes and government programs.
Also, for some reason I can't find recent poverty statistics for NL later than 2015, and I saw stats going from 11.6% to 14% which puts it fairly close to US 12.3%. I would expect given the massive social programs and minimum wage for this to be lower.
Every developed country except one. I can't believe you don't know that.
Last time I was in Australia I met a guy and his wife - they both work stacking shelves at Safeway (the very definition of minimum wage job). Not only are they paying for a house and have three kids, he has enough money for a project car (V8 something Australian) AND they fly to Bali every year for a holiday.
Yes, when you work a minimum wage full time job in a developed country you can have a very good life.
In addition, Australia has much higher taxes overall than US, but lower taxes for low-income earners.
I'm not an expert on economics by any means, but the population of the US is about 13x that of Australia and I don't know if it's possible to make a direct comparison between the two.
Source?
At some point in the mid-term future, automation will take over enough labor that a sizeable chunk of the (educated, motivated) population won't be able to find a job at all. Supply non-zero, demand zero, ergo price zero.
In that world, should we just let people starve?
Many companies have wages low enough that people receive significant public assistance while working full time. That’s a terrible trend, either the work is valuable enough to pay a living wage or or does not need to be done. Allowing companies to pay below living wages is simply an inefficient drain on the economy.
We have? I may go through the actions of consenting because I fear the repercussions of not doing so, but no part of me consents to giving the average person the right to harm me because of their personal beliefs.
The tyranny of this process is that all of the activities you go through on a daily basis are only possible because of this contract and, having grown up within this contract, if you were to leave it it would require you to invest massively in self-sufficiency (the real kind, not "I can grow a garden"), a skill that is not only excluded from general education (both within a scholastic setting and within more traditional knowledge passing routes) nearly everywhere in the world - but is often actively discouraged by societal norms.
This, I think, is a pretty good thing, because all of us being hunter gatherers who fought over bountiful locales would be a lot less interesting than knowing things like agriculture, computers and boats exist.
I hope you can see the issue telling someone they consented when they tell you they have not.
>you are beholden to the laws of your locale without ever explicitly agreeing to them
And yet we are free to break them as long as we are not caught.
>if you were to leave it it would require you to invest massively in self-sufficiency
I doubt so, because I find avoiding society is not an option. I guess if you can build your own rocket and launch yourself into space it is possible, but anywhere else in the world and you are subject to the local laws generally set by whomever has the biggest stick. I'm not exactly sure when it happened, but there was one day, not too long ago on the historical scale, where the ability to really live away from people self sufficient became impossible.
I guess there are some places you might be able to move to, not pay taxes on, and be so remote that they don't bother enforcing the laws on you. But that still depends on the idea of breaking laws as long as you can avoid any punishment you find unbearable.
>This, I think, is a pretty good thing, because all of us being hunter gatherers who fought over bountiful locales would be a lot less interesting than knowing things like agriculture, computers and boats exist.
Society has it's benefits, and yet I do wonder if every law was fully enforced would it continue to function? Think of work to rule, at national scale. Laws seem to be a sort of selectively enforced tax that helps keep society from crumbling, but even that isn't guaranteed since it seems to also give us the ability to crumble society in a way that hunter gatherers could never imagine.
This makes sense to me because it's far easier to track down the an Uber driver than a taxi driver.
citation with statistics? I don't know what world you lived in, but there was no lack of local news stories involving crimes by taxi drivers pre-ridesharing and there is a reason why taxi drivers were commonly suspects on crime drama shows like Law&Order.
I reject both the concept and it's relevance; no marginal tax rate below 100% is an income ceiling, and setting marginal tax rates at particular levels neither requires nor implies that a single such “fair” amount exists.
> I bet the people living in the Midwest would love to tax the “liberal west coast elite” living in Silicon Valley 90%
I bet most of the low income population of the West Coast (and Bay Area in particular) would like that—and benefit from it, in terms of effects on local cost of living—more than anyone in the Midwest.
> Should 90% start at $150K? $200K?
I didn't actually endorse a 90% marginal rate for federal income tax; disagreeing with a particular argument against a thing isn't endorsing it.
If I were to propose rewriting marginal rates, I'd probably do something like drop the 32% bracket down to start at about the 90th individual income percentile (instead of about the 95th, where it is currently), and drop the existing higher brackets in favor of adding additional +8% brackets at the 95th, 97th, 98th, and 99th percentiles, topping out at a 64% rate.
But more important, I'd tax capital gains as normal income, with options for both advance recognition and deferment to handle irregular streams (whether from capital events or otherwise.)
No, they never had. In fact, 47% of the population doesn’t pay income taxes at all, just payroll taxes, which are capped rather than progressive (anti progressive, actually).
The government does borrow money via IOUs to fund things like military mostly, but they also borrow money via treasuries, are you saying China’s export surplus should be mixed with regular income taxes as well?
Once the tide turns and social security is running at a deficit, regular income tax will have to pay for social security. It’s all the same money.