Framing the “Sharing Economy”: Opportunity, or Sharecropping for Oligarchs?

The early years of the 20-teens have been dominated by talk of “disruption”, as new technologies surge into previously conservative corners of the economy and shake things up. But there is a narrative that I believe will change as we move into 2016 – indeed, I believe it needs to change; what have been conversations about technology are actually about economics, politics and power.

Using the battle cry of technology and progress, some very old ideas have reemerged, let loose by depressingly shallow public debate which has been distracted by outdated ideas of the state of technology and the internet.

There are many examples, but I will begin with just one; the “sharing economy”. The state of affairs around what began, perhaps, as an optimistic reimagining of sharing, ownership and consumption has become a venture-fuelled orgy of exploitation, masquerading as a crusade against municipal corruption and cronyism.

But what underlies the “sharing economy” is a cynical trade of the control of the means of production for the means of connection; what, in the “old economy”, we would refer to as “middle-men”.

Where capital was once the class-distinguishing differentiator between the rich owners and the poor workers, a new, much smaller class has emerged that eschews ownership for monopolistic brokerage. In a technologically mediated, global, mobile economy, advantage is gained through network effects, or gaining an insurmountable critical mass of users, and brokering interactions and transactions among them. The platform and the brand are the means of connection, whereas the risky, expensive and messy capital is left to the “users” themselves, to be exploited cleanly from a distance.

Take Uber. Considered disruptive to the point of becoming a verb (“your industry could be ubered next!”), the company, backed by $8.21B of equity and venture funding, makes a concerted effort to wrap itself in the jargon of progress and liberalization. Take their response to protests by taxi drivers in Toronto:

“Taxi companies are pressuring city council to stifle competition and protect their monopoly on Toronto’s streets,” the company said in a statement.
“Ride sharing brings costs down for consumers and creates thousands of new jobs for drivers. It expands transportation options for Torontonians and will ultimately lead to fewer cars on our roads.”

It sounds as though they are dutifully fighting against entrenched interests for the good of the public, not as though they would like to circumvent the law in order to profit from each and every taxi ride globally, or reduce the already low wages of the marginally employed in order to create a global logistical network capable of, for example, overtaking and undercutting other precariously employed workers in food and package delivery; all this while shifting the burden of maintenance and ownership to those very same workers whose wages they are using to “bring costs down”.

Note that very little of this has to do with technology. It sounds precisely like the system it is replacing, but at a global, not local scale. It is enabled by technology – in this case, a platform for more efficient dispatch, matching buyers and sellers quickly – but everything else about it is old world, including the motivations.

And to believe that the backers of Uber, from its 13 rounds of venture and equity funding, are motivated by a desire to create jobs and have fewer cars on the road is beyond naive.

In many cases, you could argue that the hopeful promise of the early internet and its democratizing effects and radical challenges to consumer-culture such as the sharing economy have been co-opted to create new, perestroika-style digital oligarchs, exploiting dissatisfaction with the corruptions and inefficiencies of the existing system to replace it with a new one which, in the end, does little to create any new value, except for the very few.

Am I “against” Uber, WeWork and AirBnB? Not at all. But I believe that the altruistic traits that have been assigned to them by the broad brush of the Sharing Economy monicker, and the mis-categorization of their work as being a part of technological progress is dangerous when it frames the policy debate.

I believe setting good policy requires dialogue and deliberation among the right stakeholders. If you’re asking the wrong questions, it’s very hard to get the right stakeholders together.

So my hope for 2016 is this – that we can begin to have reality-based public and political discourse around the changing face of the economy, such that we can focus on questions more germane to the issues of progress than being either “for the future” or against it.

Such as,

How do we ensure workers rights, social benefits and safety standards in emerging technologically-mediated marketplaces?

What is the 21st century conception of “the commons” when so much of our social and commercial interactions are technologically mediated?

How do we evolve policy to be responsive to the public good as new technologies move beyond the jurisdiction of local legislators, yet exert a local impact?

What does the future of economic development and investment look like when it is the owners of capital that have been exploited and disenfranchised?

How can the promise of democratizing technologies like the internet and ecologically-minded concepts like the sharing economy be recaptured to generate public good and balanced, value-creating private gain?