Partisans Embrace Shared Economy While Ignoring Its Shortcomings

  

Uber has found a friend in Sen. Marco Rubio. The Florida Republican has eagerly and repeatedly praised the ride-hailing platform as a model of innovation in a modern economy. While teaching part-time at Florida International University, Rubio even credits Uber with turning a class of progressive students into advocates for deregulation.

But Rubio – who aspires for the nation’s highest office – is not alone among politicians who are now embracing sharing companies like Uber. Lawmakers from both parties are eager to expand or shore up voter support – especially with young people. As the de facto backbone of the sharing economy, Millennials are the ideal demographic to bring into a candidate’s tent. And despite an economy that is slowly rebounding after years of stagnant growth, many young people must still rely on part-time work through the “gig economy” and services like TaskRabbit and Uber to make ends meet. For those workers worried that over-regulation will cause their sharing economy jobs and lifestyles to evaporate, a handful of lawmakers apparently want to assure them that they have their collective backs.

While it’s true that the sharing economy offers many benefits to users and consumers, lawmakers should be hesitant to heap blank praise on Uber and other companies. The risks for drivers and hosts can easily outweigh the benefits when something goes wrong. Research from the George Mason University School of Law notes that:

Sellers of sharing services – drivers, TaskRabbits and HomeJoy house cleaners – are not full-time employees and lack benefits like health insurance, training or 401(k) donations. Wages can also be quite low. Thus, the rise of sharing firms as replacements for traditional, full-time jobs leads some to lament the rising ‘gig economy’ as a wealth transfer from workers to capital, shifting risk from employers to workers.

Furthermore, it’s simplistic and disingenuous to suggest that laws and regulations governing traditional industries only serve to stifle competition and bar new entries from the marketplace. Regulations protect consumers and businesses, alike. The George Mason research also states:

The sharing economy’s ‘de-professionalization’ of goods and services also creates consumer protection concerns: rentals on AirBnB do not need to meet hotel fire standards, Lyft drivers do not need city certification or licensure, and community chefs on Kitchensurfing have no obligation to follow local health regulations.”

For its part, Uber has made no secret of its chronic disregard for local laws and regulations. If anything, it has established a pattern of ignoring courts, regulators and local elected and enforcement officials whenever it suits the company’s needs. Uber has even instructed its drivers on how to bypass the requirements established by airport and civic authorities across the globe. It is hardly a company that anyone – especially our nation’s leaders – should be using as the gold standard for the new sharing economy.

Perhaps the lesson for all politicos is that protecting workers and ensuring consumer safety are not partisan issues. On the other hand, the lesson for those favoring deregulation may be as simple as “be careful what you wish for.”