The "Sharing" Economy: Issues Facing Platforms, Participants, and Regulators A Federal Trade Commission Workshop
I disagree with the FTC's contextualization of this phenomenon. Suppose that during a bad economy, venture capitalists fund companies based on several things conflated together: breaking labor law, combined with a genuine awareness that there is a kernel of something innovative in matching a consumer (who likes to get a bargain and feign unawareness towards wage-theft fraud and other fraud) with a supplier (who is unemployed because of the 2008 crash, and is eschewing an insistence on decent treatment out of necessity.) The VC has two simultaneous motivations: money and ideas. They want ROI, and they simultaneously want to find new ways to pursue the goals of Business Roundtable, AEI and Cato: fund the full spectrum of creative projects and approaches that will remove, reduce or rhetorically attack labor law, safety law, and anything they feel diverges from the operation of "the market". The VC would like both ROI and progress on their ideas, but if push comes to shove, their #1 duty is ROI. So they will push and hammer ideas in a militant frame of mind for as long as possible, and then at the last possible second, become conciliatory on ideas if, for instance, a wave of class-action suits has begun and they see a train barrelling towards them. So now time passes and the economy improves. The consumers are enjoying the bargains. A bargain based on a rotten foundation isn't a real bargain, but the consumer can pretend not to know. The workers are beginning to be able to find W2 jobs and better alternatives, which is another reason the VC knows something has got to give soon. Agencies like FTC have taken notice, and at this point, the VCs and the entrepreneurs they fund have an opportunity to jettison some of their militancy and reap the rewards of a seat at the table. Or, in a bestiary of entrepreneurs who came up around the same time, some make themselves a lightning rod by acting and speaking in as militant a fashion as possible. The militants get most of the attention, so by a sleight of hand, the other entrepreneurs in that wave (whose concrete practices are just as rotten) appear reasonable by comparison, and a good public face for a time period where the projects are beginning to moderate anyhow. Governments now say "how can we snap up these good ideas but incorporate some standards?" Maybe some transit departments license the technologies from the car-related startups but ditch the fraudulent use of 1099. The CEOs of those companies now get to benefit from a new role as a "thought leader" and cooperative figure who might get lucrative contracts from cities. The VC has known since the very beginning that there was going to be an arc, and that attitudes would become tougher in a good economy than in a bad one. FTC should not engage solely in framings during the more progressive moment of 2015, which play up the kernel of innovation and play down the disgusting litany of crimes that were especially concentrated during the early, unexamined interim (2009, 2010, 2011) before the journalism, the suits and before the companies were a household word: the rapes, the assaults, the robberies, the deaths of Sofia Liu and Wesley Manning. And the many anonymous workers who had a broken arm or shoulder during that early interim period in 2010 or 2011 when scrutiny was years off and unemployment was high, who should have had access to workers' comp or OSHA, but for that autonomous moment when no one was questioning 1099, they did not. What about all the ones who stayed silent because people who need income are often confounded from criticizing something they rely on? Where is the accountability for these things, not just in suits which may help a few plaintiffs, but on a longitudinal and systemic basis? When the VC looks at the entire arc, he finds it to have been worthwhile on balance. Where is the accounting for the recurring complicity of VCs in crime during the early, unregulated part of a given arc?