The ‘Sharing Economy’ is a Hoax

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Time MagazineStop calling it the sharing economy. It’s an oxymoron, like ‘creation science’ or ‘sustainable capitalism.’ It’s not collaborative: it’s the new indentured servant economy. If you believe these corporations are all about sharing and collaboration, then you’re mightily gullible. You’ve been had.

These are big, multi-billion dollar corporations whose executives are millionaires. They are more akin to drug cartels than to cooperative economics. The economic similarities are evident: both use others – the users or subscribers – to break the law for them, to generate their wealth for them, to do their dirty work, then leave those users to face legal, moral and social ramifications – and costs – on their own.

What, you think the CEOs of Uber rent their own BMW’s or Audi’s seats out to strangers and drive them around when they’re not in the office? That the CEOs of Airbnb rent their spare rooms – and they have a lot in their mansions – to strangers for weekend stays? No: you do it for them so they don’t have to take the risks. They’re laughing at you all the way to the bank.

And to icing the cake: these firms get their service providers to put their own property and even their lives at risk – and the lives and safety of their customers – without having to compensate them for it! It’s a capitalist wet dream! A gold mine of cash flowing one way into the corporate coffers. Open another bottle of that bubbly, James, we’re expanding.

As Dean Baker wrote in the Guardian in 2014:

…this new business model is largely based on evading regulations and breaking the law… If these services are still viable when operating on a level playing field they will be providing real value to the economy. As it stands, they are hugely rewarding a small number of people for finding a creative way to cheat the system.

You’re not getting to “share” your home or your vehicle: you’re working for a company to help buy someone a new yacht. Someone who doesn’t give a shit about your welfare, safety or income. You’re contributing to the 1%. Shame on you.

The only “sharing” is from your pocket into wealthy offshore corporations. Just like drug cartels: the “sharing” is one way: upwards to the top. This is about shares, not sharing. Profits, not collaboration. Entitlement, no cooperation.

John Harvey, a researcher at the University of Nottingham, writing on The Conversation, noted,

The message from most outlets is consistently positive. The sharing economy is chic. The sharing economy is caring. The sharing economy is a threat to traditional capitalism. The sharing economy will help to reduce income inequality.
Nonsense. The sharing economy is a harmful misnomer. It conflates people who actually share with those who make money through collaborative consumption…
Airbnb is not accommodation sharing, it is formalised lending. Uber is not ride sharing, it is a transportation service. Amazon’s mechanical turk is not task-sharing, it is a means to crowdsource a labour force that is frequently underpaid.

What we have been fed is newspeak: corporations labelling their business structure with a misleading title in order to hoax users into thinking they are participating in communal, peer-to-peer or individual entrepreneurial activity. Codswallop. 

They’ve hoaxed you with warm-and-fuzzy New Age thinking and weasel word vocabularies. Get all cuddly and earthy hippie-style by “sharing” the economy. It’s a hoax. A marketing ploy and you fell for it. It’s economic homeopathy: just plain water, not a cure. You’ve been scammed.

Calling this model “sharing” is like putting “new and improved” on a box of unchanged detergent to sell more boxes. This is old fashioned, 19th century-style entitlement capitalism. You take the risks, you do the work, you get charged when you’re caught: the bosses get rich. The elite win.

These corporations are no more sharing with their users than a fast food restaurant is sharing with its cashiers and burger-flippers. It’s a commercial transaction. A job at lower-than-minimum wage, with no benefits and no labour standards to protect you. And refusal to do what you’re told can get you fired from your sub-minimum-wage job! If you get caught, you might also find your insurance company drops you.

Calling users “contractors” instead of employees divests these corporations of any responsibility for standards, working conditions, safety, health, or even livable wages. Worse, it encourages many other greedy corporations to fire regular employees in exchange for temps hired through these “sharing” corporations. Which just forces more workers into them because they need to earn a living somehow.

It’s not unlike the big-box store business model: sell cheap stuff, but pay your employees so little they can’t afford to shop anywhere else.

Stephen Smoliar highlights the simple but often overlooked difference:

When you offer resources with a friend without expecting compensation, you are sharing. As soon as money enters the picture, sharing stops and economic considerations begin.

Or better yet, as Alexandra Liss writes:

Michel Bauwens, founder of the Foundation for Peer-to-Peer Alternatives, says, “Actually it’s anti-sharing, because they are commodifying resources that before would have been shared for free. Like, if you had a spare room in your house you would invite some friends and now you say, why should I share it for free, if I can make some money out of that?”…
A true Sharing Economy can not exist, when the primary focus is to appease shareholders and create profits.

The “Uber economy is like a turn of the century sweatshop” wrote an American labour rights advocacy group:

Independent workers aren’t entitled to minimum wage, overtime compensation, unemployment insurance or protection from workplace discrimination. They also aren’t entitled to benefits and don’t have the right to join a union.
A growing number of lawsuits have called the on-demand model into question.

An article by Steven Hill in Salon in late 2015 describes how these corporations are gutting the middle class and creating their own models- which benefit them, but hurt the rest of us by turning each of us into tiny microcosms of their money-grubbing model:

…We could “monetize” our assets — rent out our house, our car, our labor, our driveway, our spare drill and other personal possessions — using any number of brokerage websites and mobile apps like TaskRabbit, Airbnb, SnapGoods, the ride-sharing companies Uber and Lyft, and more.
This is the new economy: contracted, freelanced, “shared,” automated, Uber-ized, “1099-ed.” In essence, the purveyors of the new economy are forging an economic system in which those with money will be able to use faceless, anonymous interactions via brokerage websites and mobile apps to hire those without money by forcing an online bidding war to see who will charge the least for their labor, or to rent out their home, their car, or other personal property.

When we monetize everything, we lose its real value. We stop sharing – we start selling. or renting. We buy into the bleak, soulless belief that life is just about money.

Hundreds of thousands of North American jobs were moved to China because a bunch of corporations convinced us that the lowest price mattered more than quality, more than jobs, more than anything else. Now millions of people can’t afford to buy quality: just cheap, poorly-made crap. These new “sharing” companies are taking that to the next level by making us monetize all the aspects of our life. Our relationships with others gets reduced to a simple question: how much can we get from them?

And don’t give me that little-guy-versus-big-nasty-government claptrap. These are rich, hard-fighting corporations out to conquer – that’s right, conquer – every municipality on the planet to prove they make the laws;  not the judges, not the bureaucrats, not the elected officials. Their CEOs can make and break laws at their leisure because they’ve hypnotized people into thinking this is a new wave, the future. Besides, they’ll let you take the blame for it. You weren’t forced to sign on and do their work for them, were you?

Meet the new boss, same as the old boss.

Where these corporations can’t score an easy win, they bully, harass, intimidate and conduct media and social media campaigns against the municipality and its politicians. But politicians are elected to protect the rights of their citizens, not the greed of corporate shareholders. Those politicians who cave in are usually cowards, hypocrites or have been bought off. Or maybe all three.

If you hear a politician advocating to legalize these corporations, drum them out of office. They’ve sold your rights, your laws and your future – and possibly for a bag of cash. Maybe they plan to use it to buy a spine.

The irony is that you pay regardless: the taxes and fees paid by hotels and taxis or other services  that won’t be collected into municipal coffers will have to be made up. Municipalities will raise your taxes to compensate. So that money you get from renting your room or your car seat ends up being paid to the municipality. What a perfect capitalist system! You get to pay for their yachts and mansions and their taxes.

On the Who’s Driving You website, it warns:

What do you call someone who uses intimidation to get his way? A bully.
So what do you call a mega-corporation that refuses to productively work with city and state governments, and instead takes a “rules-be-damned” approach? A bully.
The evidence is overwhelming: Uber is a “my-way-or-the-highway” type of bully. Let’s take a look at their standard city market-entry strategy.
When Uber launches in a new region, they typically commence operations with complete disregard for local laws.

It is easy to go on and on. Many sites have similar pieces and warnings; it’s worth doing some research. The simple facts are that these corporations are not creating a “sharing economy” – they’re creating wealth for themselves. If you participate, you’re no more than a drug mule to a cartel: just a disposable, wetware money machine.

You want to help stop this? Don’t use these services. Don’t offer your home or car to them. And, if they’re breaking your community’s laws, report anyone who does to your local bylaw office. We need to make a collective stand against corporate bullying.

Don’t get me wrong: this rant doesn’t mean I think municipal fees, structures, policies and rules are perfect. A lot can and should change. This should be a challenge to involve public debate and input to develop more creative approaches and bureaucracies, and to trim some red tape (without sacrificing public safety). It is not an excuse for politicians and bureaucrats to roll over and stop doing their jobs.

As Dean Baker noted in the Guardian,

This downside of the sharing needs to be taken seriously, but that doesn’t mean the current tax and regulatory structure is perfect. Many existing regulations should be changed, as they were originally designed to serve narrow interests and/or have outlived their usefulness. But it doesn’t make sense to essentially exempt entire classes of business from safety regulations or taxes just because they provide their services over the Internet.

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One Reply to “The ‘Sharing Economy’ is a Hoax”

  1. http://journalistsresource.org/studies/economics/business/airbnb-lyft-uber-bike-share-sharing-economy-research-roundup

    This offers some resources on both sides of the argument (mostly pro, which is disappointing in a journalists’ resource site where one expects more balance). The author also buys into the oxymoron that mega-corporations are part of the “sharing” economy instead of being rapacious, for-profit capitalist predators. Here are some interesting selections, however:

    “…Our baseline estimate is that a 1% increase in Airbnb listings in Texas results in a 0.05% decrease in quarterly hotel revenues, an estimate compounded by Airbnb’s rapid growth.… We find that the impacts are distributed unevenly across the industry, with lower-end hotels and hotels not catering to business travelers being the most affected.”

    “…It is also true that the rise of independent workers, and associated job insecurity, long predates the recent rise of the sharing economy, although their percentage of all U.S. workers is expected to grow from about one-third currently to 40% by 2020, according to some estimates.”

    “…these new technologies of peer-to-peer economic activity are potentially powerful tools for building a social movement centered on genuine practices of sharing and cooperation in the production and consumption of goods and services. But achieving that potential will require democratizing the ownership and governance of the platforms.”(in other words, not run by mega-corporations!)

    “…At the heart of many of these debates is whether Uber is, as it claims, operating as a pure technology company, providing a match-making service to willing participants, or whether it is operating in effect as an unlicensed taxi service, which was the conclusion of Calgary’s city council. Moreover, a Massachusetts class-action lawsuit asserts that Uber exploits its drivers, misclassifying them as independent contractors to avoid paying them as employees with the same benefits.”

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