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Why the Sharing Economy Is About Desperation, Not Trust
An anonymous reader writes "Wired recently ran a cover story about the sharing economy — shorthand for the rise of peer-to-peer rental services like Lyft and Airbnb — which they call a cultural and economic breakthrough. They say it has ushered in a 'new era of Internet-enabled intimacy.' An article at New York Magazine has another theory: that it arose because of the weakness in the real economy. Quoting: 'A huge precondition for the sharing economy has been a depressed labor market, in which lots of people are trying to fill holes in their income by monetizing their stuff and their labor in creative ways. In many cases, people join the sharing economy because they've recently lost a full-time job and are piecing together income from several part-time gigs to replace it. In a few cases, it's because the pricing structure of the sharing economy made their old jobs less profitable. (Like full-time taxi drivers who have switched to Lyft or Uber.) In almost every case, what compels people to open up their homes and cars to complete strangers is money, not trust.'"
tl;dr Marx was right that an over-production would leave the majority in poverty, and the only economically sustainable solution is sharing. It's not "desperation", but an inevitable and rational necessity.
In many countries in the world it's quite common for people to share stuff like taxi services and rooms and has been for decades. In many of these places the crime rate is far higher than in the United States. The huge contrast between the amount of distrust people seem to have for each other in America and the actual rate of crime (which is quite low and has been decreasing for decades) is pretty astounding.
A fool and his hard drive are soon parted.
It may well be that 'sharing economy' is just a manifestation of a deeper problem, the inability of the drivers of development in the past century -- capitalism and democracy -- to cope with the problems the modern world is facing.
The world needs a new political and economic systems that can tackle the problems we're facing, and tackle them efficiently and in a way that makes sense both locally and globally. It is most likely that these will evolve out of what we already have with the experience and frustrations we gain from trial-and-error experiments like the sharing economy, free online education and whatnot.
True, its about desperation, not necessarily an extra layer of 'internet trust'.
The US is unique in developed economies - luxuries are cheap...big screen TV, a car and so on. But necessities are expensive...healthcare, decent education, and to an extent housing.
Tat Tvam Asi
...but I don't think that the only necessities are economic (...as both dyed-thru Marxists and Neocons seem to? I get that this is not you). While it's true the trigger for my involvement with "sharing"--from free-as-in-beer file-sharing to using Airbnb to potlucks to etc. etc.--may sometimes be economic, "because I can't afford to otherwise" doesn't actually make it in the top three of my reasons, now very much engaged with "sharing," for continuing in it.
The New Intimacy is new not because humans are different, but because more are more available than ever before. #internet
Economic "realists" are the children who built the world variously self-destructing.
Can be seen in those who defend the taxi system on the grounds of "consumer protection." People might get overcharged? Not a justifiction for a system so blatantly anti-consumer as the taxi regulations across the country that turned what should be a low barrier to entry job with modest pay into a very lucrative position that blatantly uses the power of the state to shaft customers out of competition. I mean FFS, the car has an odometer. All you need is a law requiring the driver to provide the start and end mileage to the customer and to have them agree verbally to a rate per mile.
Things are going to have to get very bad for change though. The forces for the status quo are way too strong and powerful.
Even I, a peon getting screwed over by the system, is a bit scared of it - eliminate democracy? Whoah!
Anyway, when things change too radically, extrememly bad things happen - like Hitler, Stalin, Castro, ...
Capitalism works fine within the norrow confines of economic activity and with plenty government checks. Nineteenth century USA business history is a great example of Laissez-Faire capitalism and what a disaster it was environmentally, economically, politically and socially. Even the US Right's patron saint, Adam Smith, warned about the dangers Capitalism - something that's been forgotten or ignored.
But as the World becomes ever more populated and natural resources become even more stretchly thinned, something is gonna break.
The Free Markets are thrown around as a pancea for the World's woes, but tell a couple of billion cold, starving, thirsty people that they just need to cough the money and work harder and they too can have what they need. I don't know, I just think Roman Empire and barbarians invading.
But like I said above, unless there is a catastrophy we won't change. The status quo - the economic bullies - have got theirs and they are not going to let it go. Their primitive and shallow desires are dragging us all down. Their desire to leave legacies to their offspring has them getting their bitches in legisaltures to allow for generational accumulation of wealth - aristocracies - and we all know what happens with that: revolution and mass death.
My fellow peons who stick up for the economic bullies will stand behind them - out of aspiration, fear of change or because of human nature to identify with one's abuser (I think that's why so many Right Wingers stand up for the Koch's and other businessmen who harm their economic interests.)
Any business model that is forged out of desperation rather than want and need is doomed to fail in the long run.
There are businesses that exist because they're beneficial for both parties. They are usually very long lasting because both parties have an interest to continue. As soon as you force one party into the contract, they will start looking left and right for alternatives and for ways out of it. Eventually people forced into such a situation will even out of spite try to get out, even if that means an economic disadvantage that is at least survivable.
For reference, see pretty much any adhesion contract in history.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
has been the domain of the rich. This is because sharing was moderated by expensive middle men. If you own a castle in Britain, you are likely to regularly share some of the rooms (short-term renting them out through an expensive agency). But it wasn't easy to rent out that extra room or your basement in your three bedroom suburban house, because there was no affordable way to efficiently access that market (the market structure was very thin for short term renting).
Now the rest of us can partake in the sharing economy, agency costs have dropped dramatically for the stuff that the rest of us own.
Then started a new cycle where the skill those workers had were incorporated into robotics, again forcing us to develop a new set of meta-skills because it can crank out parts with near perfect precision 24x7 and it was back to huge production lines.
That plant the laid off its workers only needs a handful of folks to maintain the robots. It's NOT a one to one transition. It's at least a 10 to 1 DOWNSIZING.
Now those skills are being incorporated into electronics, and we're again looking for new meta skills. It all comes full circle again and again.
Everytime the "circle" goes around LESS labor is needed.
Just where are those workers going to go because other industries are not absorbing them - the employment numbers proves it.
Look at today's big comanies - like Amazon. They have about 30,000 employees.
A couple of decades ago, a company that size would have had a million people of ALL skill levels working there. But automation has made things much more efficient. Cheaper for the rest of us, sure. But what to do with all the displaced workers? Retrain? For what?
All the new big companies only need a fraction of employees needed before.
EVERY industry is doing this. There is no indsutry that is increasing their workforce - none. Even medical is becoming more efficient and (ever so slowly) automating on the lower levels. And there's other changes too.
And that is what get's me about the fetish of policy makers who want manufacturing to come back to the US: it'll be done by robots.
In the 19th century, Western society went from on labor intensive economy (Agriculture) to another (Manufacturing). So, there was opportunity for transistion.
But today, new industries are going straight to automation (or off-shoring), old industries are doing the same, and there's a ever decreasing pool of jobs for people - and as a result, wages are declining in real terms.
Just making straight comparisons with the past and today and strugging off social and economic changes that is hurting the average guy is the wrong analysis and the numbers prove it.
A market works best if all sides have the same access to knowledge. Prior to the Internet there was no big market for "i have a room which is dont use" because exchanging information was too expensive.
However, it was not at all unusual on the countryside to just put up a sign if you had a room to rent. I remember bicycle trips where we just stopped at some farm and asked and got a room there.
What is new is that you can plan this.
In previous decades people shared stuff a lot. They shared tools, e.g., when they build houses. They shared land. They shared knowledge. Farmers, share their equipment for a long time, as it was expensive all the time. For example, harvesters are shared even today through farmers cooperatives. The "new" share economy is, therefore, not new. The only new thing is that the sharing platform is now a company and not a joint organisation making profit out of sharing. Furthermore, consumers are now able to share their goods with people over a larger area. And true, people would have led their car in the past only to people they know of. Now they share it with people who pay for it.
In the past sharing was a social act. Now it is a business. However, traditional sharing is also increasing. And traditional sharing requires people to like each other. Therefore, they have to build working relationships, which is definitively a step in the right direction.
When the game is rigged against the individual in favor of corporations, the wealthy, and banks the only sane and sensible solution is not to play.
putting the 'B' in LGBTQ+
Why is an growth necessary? To sustain our current economic models perhaps, but they are themselves a very recent anomaly dating back to somewhere around the beginning of the industrial revolution and the liberation of productivity from the number of laborers available. As you point out, all sustained growth is exponential, and that is unsustainable in a finite environment. And we're already bumping up against the limits of our global ecosystem so it must end relatively soon.
No matter what the economists want to believe, sustainable growth is an oxymoron and we're going to be forced to return to an economic model which presumes the entirety of production remains relatively stable. Individual businesses may still grow, but only at the expense of other businesses (competitors and/or those rendered obsolete) But there's no particular reason they need to grow at all. Even today there are plenty of small businesses that don't subscribe to the "grow or die" philosophy, and have instead simply grown until they reach a comfortable, sustainable size and then remain there indefinitely. And that's absolutely normal. In days gone past a master blacksmith could only grow his business to the limits of his own productivity - he might take on an apprentice or two to help out with the easier stuff, but it was his own skill at the forge that drove business.
--- Most topics have many sides worth arguing, allow me to take one opposite you.
"what compels people to open up their homes and cars to complete strangers is money, not trust."
... and ...
That's interesting. Could the exact same thing be said about the banking industry? And the insurance industry? And stock brokerages?
The fact that New York magazine smears the sharing economy with the word "desperation" just speaks of editoralizing that tries to use controversial words to grab attention. Without the prestige of slick magazine paper, we would just call that activity "trolling".
We should learn what we need to know about issues, before we decide what we need to feel about them.
Right now, the big scare is that we're running into a deflation. No, really. DEflation. Not INflation. Now, considering how bad inflation is (allegedly), deflation must be good, right? Wrong! It's even more feared than inflation.
Inflation and deflation are orthogonal to each other. Inflation is a devaluation/flat tax on money while deflation is a devaluation of goods & services that can be bought with money. You can have both at the same time, they are not opposites, but two entirely seperate matrixes which are, at most and only under certain circumstances and certain moments, indirectly linked to each other. Right now we're observing a bit of a mixture of both.
We suffer more in our imagination than in reality. - Seneca
Farming has been automated. Construction is being automated. Machine work has been automated for a long time, except for specialty one-of stuff - when's the last time you had something custom made at the local machine shop? And even the one-of stuff is being largely automated by CNC and other rapid-prototyping technologies.
Plumbing, yeah, that's still mostly done by hand, as is electrical work. Maintenance of existing products (houses in this case) is still mostly beyond automation capabilities, but how many hours worth of combined plumbers, electricians, home renovators, auto mechanics, etc. do you suppose you employ in an average year?
--- Most topics have many sides worth arguing, allow me to take one opposite you.
In terms of farming, absolutely. By optimizing away the common man's ability to be self-sufficient we've fundamentally altered the nature of the "game".
As for military spending, sure we need a certain level to keep the barbarians from our gates. Though outspending the next 20+ nations combined is probably overkill. But that's getting off topic.
As for taxes, there's lots of other ways taxes can be good for everyone. Roads for example. Dirt ruts can only carry you so far, and toll roads are unlikely to be cost effective. Free paved roads allow the farmer to get his produce to market in a timely fashion instead of having 80% of it rot along the way. Other infrastructure can operate similarly - so long as a 10% increase in taxes provides for infrastructure that increases your profitability by 20% almost everyone wins. Similarly with cleanup and policing (which could both be be conceived of as defense against the carelessness or maliciousness of your neighbors). Then there's things like medicine and eduction, which done wisely can be immensely profitable for all involved when socialized at a basic level. The costs of basic services are minimal when spread across the population, and most everyone benefits from both the direct education and the resulting facilitation of the poor-but-brilliant child being able to get a good start towards becoming an engine of societal advancement. Life-extension medicine is it's own thing, there's unlikely to be any great benefit to society from keeping an octogenarian or permanent invalid alive for an extra cuple couple decades, though one could debate as to whether the occasional Steven Hawking is worth the cost. Fixing broken bones and curing infectious diseases though - that's cheap, and everyone benefits, even if they never personally have cause to partake, since it's increasing the percentage of able-bodied individuals in your society (= decreasing freeloaders), and helping to avoid plagues.
--- Most topics have many sides worth arguing, allow me to take one opposite you.
"If you do not work you do not eat"? Spoken as a true corporate tool. Who defines what "work" is then? Guess what: the people with money do, as they always have. Ask a rich CEO why they deserve the highest compensation multiple of workers ever today, and they'll tell you all about how their work adds value!
There's only place this road has ever led toward: rich people get so much negotiating power over poor ones they force them into inhumane working conditions, knowing they have to accept that or starve. You don't get a wonderful world--instead you'll just keep reinventing the Triangle Shirtwaist Factory fire for modern workers. Gotta lock the doors, can't have people in the factory stealing our precious iThings to sell them for food!
You lost me when you said government run programs ate inwffecient compared to private enterprise. While that is true in some cases that isn't always true. Medicare for example is 10 times more efficient dollar for dollar to private insurance. Most private insurance spends 20% ( now it used to be higher) on adminstration. Medicare is 2-3%.
Just remember when the big three auto makers went looking for a bailout they flew to Washington in their corporate jets. If they were truely efficient they wouldn't need a politician to point out the stupidly obvious waste of funds. How inefficient does a private enterprise have to be if a politician notices their failures.
Once you get to be a big business efficieny goes out the door. Governments are just big business with mediocore oversight However more people can see the books. If you really looked at a large businesses books you wouldn't say that private business is more efficient. The rest of your post rambles on from that misconception.
i thought once I was found, but it was only a dream.