Readers of Real Change are probably well aware of some of the difficulties with the so-called “sharing economy,” best exemplified by Airbnb, Uber and Lyft, which grew exponentially from humble beginnings. Tom Slee’s “What’s Yours Is Mine” is more than a detailing of the negative impacts of these companies; it takes a look at the Silicon Valley philosophy of “open sharing” for profit and shows how money-making and sharing of common space are ultimately incompatible.
Airbnb, Uber, Lyft and less successful “sharing” platforms like TaskRabbit, Homejoy and Handy all started from a similar premise — that they could make money as intermediaries between service providers and customers, while enabling people who have skills, time or resources to make extra money by linking directly with customers. The concept is attractive. If you have extra space in your house, you can rent it to a traveler; if you are driving somewhere, you can give somebody a ride; if you have a skill, you can be paid directly for your work.
Unfortunately, much of the money to be made this way is due to the ability of online platforms to circumvent local safety regulations, minimum wages and accountability for quality, as well as taxes. Companies such as Airbnb and Uber argue that government regulations shouldn’t apply to them because they have customer-driver rating systems. They argue that if somebody doesn’t provide the service for which they’ve contracted, they’ll lose customers. However, an Uber rider can’t tell if a car’s brakes are about to fail. There’s no way for Airbnb to know that a rental is legal. And it may not be evident whether the chemicals used to clean a home by Homejoy are nontoxic. Because of the personal connection, customers generally feel embarrassed or afraid to give low ratings; consequently, almost everyone on Uber or Airbnb gets a very high rating. Slee points out that most sharing-economy ratings cluster toward the top of the rating scales, as opposed to ratings made on sites like Netflix or Yelp, which tend to follow the normal “curve” with which we’re familiar from grading in school. He speculates that this is a combination of a fear of retaliation (service providers rate customers, as well as customers rating providers) and a cultural reluctance to publicly bad mouth a person (as opposed to a business) who has just provided a service you asked for. Because of that, what differences there are in the ratings are useless; there’s no evidence that somebody with an average rating of “4.6” on a 1-to-5 scale provides worse service than somebody who’s rated “4.9.”
On the other side, because workers in the shared economy are treated as contractors, they have no guarantee of making minimum wage after paying for their expenses — and often don’t. Circumvention of regulation also makes it hard for cities to manage their housing stock and traffic patterns. Although the majority of Airbnb’s hosts fit the image of the renter or homeowner making a little extra money, the majority of Airbnb’s money is made from the minority of hosts who manage multiple listings; this has led to problems with needed permanent housing being converted into short-term rentals.
Another area that the sharing platforms ignore is the responsibility to provide equal accommodation, regardless of race or disability. It’s not enough to argue, for example, that individual car owners may or may not be able to pick up somebody in a wheelchair — it’s the responsibility of a company like Uber to find a way to serve disabled people. On the other end, the race of Airbnb hosts is generally identifiable on the site; studies have shown that White hosts are able to charge an average of 12 percent more than Black hosts for similar accommodations in the same city.
With each problem that is identified, sharing platforms have consistently argued that it is the service providers, not the platforms, that are responsible for solving it. Yet it is the sharing platforms that are profiting the most.
Slee argues that there is a basic contradiction between sharing and making lots of money. He writes, “In a few short years the Sharing Economy has gone from the generosity of ‘what’s mine is yours’ to the self interest of ‘what’s yours is mine’ ... what started as an appeal to community, person-to-person connections, sustainability and sharing, has become the playground of billionaires ... what’s happened is a separation of risk ... from reward, which accrues to the platform owners.”
Slee frames this as falling into a problem of a commons, which the internet once resembled. A commons, broadly defined, is an area of life or space that a community benefits from collectively, and which community members work voluntarily to maintain; there may be people who directly make money off the commons — for example, people may use sidewalks to hawk goods (or even sell Real Change) — but the greater part of the benefit accrues to the community. The internet and web developed originally as a commons, but have increasingly been taken over by commercial interests. While the web facilitates a diversity of voices, it also encourages a concentration of revenue and profit at the other end of the scale, both to the various platforms and to the most popular artists and writers.
Slee suggests that those people who truly want to create a “sharing economy” need to step back from the idea that there is a simple technological fix for complicated social problems, pay more attention to the lessons of earlier collaborative and co-operative movements and give up the idea that people who are primarily motivated by profit will create a world where everybody can benefit.
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