Democrats Continue to Fight–and Lose–Against the Sharing Economy

Democrats got a quick lesson in the dangers of opposing innovation this past week from New York City Mayor Bill de Blasio, who is licking his wounds following an embarrassing loss in the fight against the ride-sharing service Uber.

De Blasio’s lobbying effort against the shared economy was laughable. He attempted to make the case that Uber would add to traffic congestion, but refused to publicly release any traffic data to prove his point. Then, in an op-ed in the New York Daily News, the mayor pandered to his liberal base by somehow comparing Uber to an Exxon or Wal-Mart on wheels. And then, seeing that he was fighting a losing battle, he pulled a Hillary Clinton and tried to paint the sharing economy as harmful to workers, a pained paean to the taxi cartel (who isn’t exactly known for great working conditions). Throughout it all his real motivation was clear: He was doing anything he could to protect taxi companies, who were one of his largest campaign donors.

Tellingly, de Blasio’s “plan” was to admit he didn’t have one. Instead, he proposed arbitrarily capping the growth of any for-hire vehicle company until the city government could figure out how to regulate them. But even that weak attempt at curbing the sharing economy fell flat with nearly every constituency save the cab cartels, which forced de Blasio to embarrassingly back off nearly all of his demands.

Unfortunately for de Blasio, he didn’t make it through the fight unscathed. Indeed, many of his wounds (at least the ones that weren’t self-inflicted) came from his own side.

“The last thing you should be doing, if you’re trying to create jobs in a city, provide more economic opportunity, have more environmentally friendly transportation options – this is exactly the wrong thing to do,” Uber chief advisor David Plouffe (yes, that David Plouffe) said recently. “At the end of the day, I think the motivation here is the taxi industry has showered the mayor, the City Council president, and others with a lot of money, and this is payback.”

Plouffe wasn’t the only one to see through the ruse. The New York Daily News blasted the mayor as engaging “in a protectionist crusade for an entrenched industry, absurdly claiming to stand for the thousands of New York passengers and drivers who have flocked to Uber.” And even Governor Andrew Cuomo sniped at the mayor, saying, “Uber is one of these great inventions, startups, of this new economy and its taking off like fire to dry grass and it’s giving people jobs. I don’t think the government should be in the business of restricting job growth.”

Unfortunately, pro-sharing economy Democrats like Plouffe and Cuomo appear to be the exception rather than the rule, a political divide that is becoming harder to defend on pure policy grounds. After all, there is little argument that it has been great for consumers. Uber often allows for a better, cheaper, and faster transportation option that harnesses key innovative forces like app-based technology, which enables riders to pick the kind of vehicle they want, see reviews of their driver, and pay without having to fumble with a cash or a credit card.

But there is a mounting case that the sharing economy, typified by Uber, TaskRabbit, AirBnB, and others, is also great for workers as well. A recent poll by the Benenson strategy group found that just 8 percent of Uber drivers were unemployed, suggesting that they use it as a supplementary income stream. Moreover, the drivers seemed to fully understand the trade-off that was being asked of them as contractors – the freedom to work whenever and as much as they want in return for no benefits. The poll found that 73 percent of drivers would rather have a job where you choose your own schedule and are your own boss, than a steady 9-to-5 job with some benefits and a set salary. The satisfaction may come from the fact that 49 percent of Uber drivers who also work for a taxi, ride-sharing or black car company say they earn more on the Uber platform and 29 percent say they make the same. All told, 78 percent of drivers are satisfied with their experience in driving for Uber.

Those numbers show that Uber isn’t hurting workers, it’s helping them provide for their families in their spare time. Sadly, that hasn’t stopped cab cartels and eager regulators from attempting to shut the company down. Take, for instance, California, which is burying Uber beneath mounds of paperwork and frivolous lawsuits in an effort to frustrate the growth of their business model. As Tim Cavenaugh writes for City Journal:

Notably, complaints about Uber typically aren’t coming from customers, and even among the firm’s drivers, crusades like Berwick’s are rare. In fact, what’s striking about the various campaigns against ride-sharing is their reliance on paperwork and credentialing instead of outcomes. The [California Public Utilities Commission], for example, doesn’t assert that Uber is harming actual handicapped people, only that the company has failed to produce paperwork that proves the absence of harm. Similarly, the cab companies’ speech-related lawsuit—which focuses on safety claims made in Uber ads—does not claim that traditional taxis are safer than Uber rides. The plaintiffs assert instead that cab drivers are subjected to more paperwork than Uber drivers.

Sadly, it appears that California, like New York before it, will have to learn the hard way that no amount of government bureaucracy can stand in the way of progress. But if Democrats want to keep trying and failing, then at least voters will be left with a clear message in 2016.