“What’s bad for the hive is bad for the bee.” – Marcus Aurelius (b. 121 AD – d.180 AD), Roman Emperor (161 AD – 180 AD)
Those closest to me know that I’m not fan of the gig economy. It only takes a slight mention of Uber, Lyft, GrubHub, or InstaCart to set me off and ruin an evening out with friends.
The gig economy is a marketing term created by the companies that invented the business model that depends on exploitation of low-cost labor. You see, one of the most expensive line items on a company’s balance sheet are the employee costs. There are salaries, payroll (aka FICA) taxes, unemployment insurance, state disability, and benefits which include things like health insurance and retirement plans. The companies who have invented this business model have figured out how to unload these costs and transfer them to their users and the general public. Users pay the base wage as a percentage of the service fee, and the general public foots the bill for remaining taxes and benefits. All the while, the companies slowly squeeze the contractors, extracting ever larger percentages of the service fees to drive corporate profits and company valuations. These in turn result in more money going into the pocket of founders and investors, whose net worth balloons into the hundreds of millions of dollars or more.
These companies are a symptom of the changing dynamics of Silicon Valley. Investors and founders do not seem to be looking out for what is good for society as a whole but instead are looking out for what will benefit them most. My favorite venture capital blogger, Brad Feld, wrote and excellent piece on Cynicism in Silicon Valley. In it, he references numerous articles showing how technology companies are becoming their own worst enemies and cannot seem to get out of their own way.
One particularly poignant article was written by Lia Russel for The New Republic titled – The Silicon Valley Economy Is Here. And It’s a Nightmare. The byline says it all, “Low pay, soaring rents, and cities littered with e-scooters. Welcome to the future.” She shows how technology startups are exploiting middle and low income workers by skirting labor laws and regulations to enrich themselves and their backers. As stated in the article, even when rideshare companies claim they will guarantee drivers a minimum wage of $15.60/hr, the real wage comes out to $5.64/hr once expenses and unpaid time between rides are taken into account.
Yet these companies complain bitterly about “unnecessary regulation” and continue to get away with their bad business practices. As UC Berkeley professor Ken Jacobs, who ran the study said, “We as a society have agreed that there are certain standards that businesses have to adhere to in terms of treatment of workers in this country. Gig companies have developed a business model that has been geared toward evading labor and employment law and shifting all costs and risks onto workers.” In California they’ve passed a new bill in an attempt to address the worker misclassification issue, but I wonder if and how they will enforce it.
I wish I could say that this was an issue isolated to Silicon Valley and big technology companies, bit it is a more widespread problem. I see the “me-first” attitude in Wall Street banks who have figured out how to maximize fees from investors to their benefit. Our government officials are more concerned with amassing power, their public image, and their lobbying career after office rather than doing what’s right by their constituents. Energy companies are protecting their assets and profits at the risk of our environmental future. Food companies use additives and sugar to create cheap junk food that is at the heart of our obesity and health issues. I get the feeling that people are more concerned about what’s in it for them in the here and now rather than planting trees for the future.
We, as a society, need to come together and recognize what the Roman emperor Marcus Aurelius observed 2000 years ago. When one benefits at the expense of the hive, it’s the whole hive that suffers. So even the ones who benefit today at the expense of the group will eventually be brought down to the level of the hive. On the flip side, when one does things that are good for the hive, then everyone benefits and ends up better. It’s how we got to where we are today. People before us made decisions that benefited not only themselves but society as a whole. It created the conditions we enjoy today. It’s our responsibility to continue the traditions and pay it forward. Or, as Seth Godin so eloquently put it, and in much fewer words than I did here, we need to be citizens. I would emphasize that we need to be good citizens at that.
We can do this. If we each do our part, we can leave the world in a better place than where we found it. We owe it not only to those who will come after us but also to our future selves. Just keep this in mind – what’s bad for the hive is bad for the bee.
I’ll close with this passage from the Daily Stoic website:
What good is our success if it comes at the expense of others? What good are we if we can’t help others? We are all bound up in this thing called life together. If we forget that, we’re not only not as advanced or evolved as we think we are, but we are turning our backs on an ancient truth as well.
Pingback: Government for Sale - Gregg Borodaty
Pingback: We need to do our part - Gregg Borodaty