California dreaming

On such a hot, summer’s day

IT’S THE NEW way of the world. Have a friend pick you up at the airport? How 1986. Need a designated driver after a few unplanned after-work beers? How 2004.

Get a ride (and get with this decade) the 2019 way: With an Uber or the like.

But in California, oh California— where the Golden Sierras keep their watch o’er the valleys bloom—the state’s lawmakers are working on a new bill to upend the very gig economy that companies like Uber and Lyft help drive. Rather than leave pay increases and benefits to something like the market, some of California’s betters know better. Or think they do.

Artificial economic plans bolstered by government interference—what could go wrong? Here’s more on the bill from NBC News: “The bill has the potential to change the employment status of more than 1 million low-wage workers in California, not just gig workers at companies like Uber, Lyft, DoorDash, Postmates and Instacart. It will make it harder for gig economy companies to prove that their workers aren’t staff, while ensuring key benefits and protections, like minimum wage, insurance and sick days.”

Uber and Lyft offer a smart product. No cash is exchanged, service is affordable and the drivers are much more responsive than cab drivers used to be. (Competition has changed a lot of that.) The secret to this sauce: Uber and Lyft employ independent contractors who work when they want and make as much or as little money as they desire.

How many jobs allow workers to set their own schedules every single day? Or not show up at all on days when you’re busy or just uninterested in work? Try that anywhere else. But Uber and Lyft drivers pull out their phones and decide when they’ll work and when they’re done with the tap of a button. And the company is fine with that. Completely.

The trade-off? These workers don’t get a guaranteed minimum wage. If there aren’t a lot of rides coming in, drivers aren’t going to make as much money. On the flip side, during peak hours, in target-rich environments, drivers make

more money. It may be feast or famine, but the most efficient drivers usually get a system together in which they make enough money to satisfy their Earthly needs. It takes some ingenuity, but that’s the gig. Drivers typically know what they’re getting themselves into, and if they don’t, they will after a few days behind the wheel for eight or 10 hours.

It’s nice to have protections like a minimum wage and paid time off, but those are benefits of traditional employment at traditional businesses. And those benefits have hardly ever been extended to independent contractors.

But if certain of these drivers want traditional benefits, they can either negotiate with their clients—Uber, Lyft, Postmates, etc.— or else find employment in a job that offers them. Like with trucking companies. The government stepping in to force these tech companies to offer said benefits is unwanted interference in the free market.

Just in case California hasn’t noticed, the economy is going gangbusters right now. So it’s a great time to find a new job if Uber/Lyft driving isn’t attractive enough.

MANY politicians don’t seem to get the basics of running a business. If the government steps in and forces companies to offer benefits that cost too much money, companies might just slash hours and payrolls. The house always wins. Uber wrote on its website that this bill could lead to it hiring “far fewer drivers than we currently support.”

Another alternative could include Uber offering its drivers these benefits— and passing the costs onto its customers. That’s another business lesson some of our politicians might try to understand.

Uber and Lyft proposed establishing a $21-an-hour minimum wage for drivers in California at the bargaining table, indicating a willingness to bargain. But that might not be enough.

Free market solutions are almost always preferable to government interference.

If those running government would only allow it.