Uber, Lyft, and Airbnb: The Coronavirus, The Law, and Their Future

We’re over seven months past the first Covid-19 business closures, and our ride and place sharing concerns are still going on just fine.  Or are they?

Per Greg Bensinger in the August 19^th New York Times, “Uber and Lyft Just Can’t Stop Flouting the Law.”  That may be the wrong verb, as true limits on them are weak, so the firms have been able to pretend they are offering only technology, “a legal strategy” which thus far “has allowed them to label their legions of drivers contract workers, depriving them of company-backed benefits like health care, paid leave and severance pay.”  That, though, took a hit the month before, as “Uber and Lyft Drivers Win Ruling on Unemployment Benefits” (Noam Scheiber, The New York Times, July 28^th), as “a federal judge in New York,” finding both employers had perpetrated “an avoidable and inexcusable delay in the payment of unemployment insurance,” pronounced “that the state must promptly begin.”  As well, one in Pennsylvania had three days earlier ruled an Uber driver company-employed, which could precipitate the same verdict there.

Yet on September 22^nd, per Scheiber’s “Uber and Lyft Could Gain From U.S. Rule Defining Employment” that day in the same publication, the federal Labor Department announced “a so-called interpretive rule, not a regulation that has the force of law,” considering mainly “the extent to which a company controls how a worker performs a job” and “the opportunity that a worker has to profit in the job based on initiative, rather than simply earning a steady wage.”  Neither seem like overwhelming points in favor of keeping such drivers, who must use vehicles meeting certain standards and whose extra pay from taking more rides can be seen as just bonuses, as contractors, and, for one thing, cannot willfully assure themselves of any wage.

Over to different-line but structurally identical Airbnb, the hotel chain with plenty of rules for providers but thus far exempt from government regulations.  As Elaine Glusac put it in September 24^th’s “The Future of Airbnb,” also in the Times, that company will soon go public, and admits to “challenges” associated with the pandemic’s effect on travel patterns.  They are more often renting larger houses in rural settings for more daily money and longer stays.  They are encountering some places restricting short-term rentals, and providers are drawing “complaints by Muslim, transgender (how would they know?) and other groups” for allegedly denying bookings.  More laws are coming, but they may adapt to those as well.

In another Times piece by Scheiber, we saw that “Seattle Passes Minimum Pay Rate for Uber and Lyft Drivers” (September 29^th).  That city’s board unanimously passed a January requirement that such workers get, on top of expenses, Seattle’s $16 minimum hourly wage.  When I drove cab it typically was about 10 miles each hour, which, at the current I.R.S. rate of 57.5 cents apiece, would mean a total of $174 for an eight-hour shift.  That means the driver’s share of fares would need to be $21.75 plus everything else they cost, hour out and hour in, for Uber and Lyft to break even.  That’s a lot. 

Further down the coast, these ridesharers didn’t fare any better, per “Appeals Court Says Uber and Lyft Must Treat California Drivers as Employees” (Kate Conger, The New York Times, October 22^nd).  Not yet though, as those firms “are sponsoring a state ballot initiative, Proposition 22, to exempt them from the law and allow them to continue classifying drivers as independent contractors, while providing them with limited benefits.”  The next day, a follow-on piece by Conger also appeared in the Times, with the possibly quite accurate title of “It’s a Ballot Fight for Survival for Gig Companies Like Uber.” 

Should these sharing-economy concerns be free of most industry regulations?  There is a good case for yes – people need a chance to make money consistent with modest wants and needs.  Yet, if so, there is no excuse for Hilton and Yellow Cab to be thus fettered.  Even exempt, Uber and Lyft have never been profitable.  I don’t know about the homesharer, which lost $322 million in the first nine months of 2019 though maintaining profitable geographic areas, but the other two, with the virus threatening a year or more to run, are in deeper trouble than ever.  Laws or not, don’t count on them surviving.

 

Joe Biden for President

In some of the 11 times I have been franchised to contribute, my decision of who to support for the next elected President of the United States has been close.  I have chosen two from small fringe parties, and three apiece from Democrats, Republicans, and Libertarians.  My 2012 judgment was particularly marginal, and I picked Barack Obama over Mitt Romney with two days to spare.  In 1980, 1984, and 2008, though, I had decided months before, choosing and publicizing my favoring of Ed Clark, Ronald Reagan, and Obama. 

This year fits with those three. 

During my life, 12 people have occupied this office.  I have disliked almost all at one point or another, but only three of the first 11 – Richard Nixon, Bill Clinton, and George W. Bush – have consistently given me that reaction. 

The twelfth has been in a class by himself.  Donald Trump has been catastrophically reprehensible.

There is no mitigating what Trump has said, done, and failed to do during his 45 months in office.  There are no reasonable comparisons to previous presidents, even to Nixon who resigned in disgrace or Clinton who lied under oath to a grand jury. 

I will not attempt to document everything despicable and inappropriate he has perpetrated, as others have already done fine jobs of that.  For example, the October 18^th New York Times Editorial Board issued a ten-page section titled “The Case Against Donald Trump.”  Even factoring out some complaints I consider weak or invalid, they documented an Everest-sized mountain of misdeeds, calling him at length on “his unapologetic corruption,” “his demagogy,” “his incompetent statesmanship,” and “his super-spreader (Covid-19) agenda.”  The section’s opening article, “A Man Unworthy of the Office He Holds,” subheaded by “Donald Trump can’t solve the nation’s most pressing problems because he is the nation’s most pressing problem,” started with “Donald Trump’s re-election campaign poses the greatest threat to American democracy since the Second World War,” and, from there, charged him with having “governed on behalf of the wealthy,” having “strained longstanding alliances while embracing dictators like Kim Jong-un and Vladimir Putin,” having “pitted Americans against one another” and having “flouted the rule of law.” He was impeached, unsuccessfully, for “high crimes and misdemeanors.”  His vile verbal style has embarrassed the country internally and worldwide.  He has shown himself to be unprincipled, with his greatest emphasis on helping himself.  The more information we have received about his business success, the weaker it has seemed, and now looks truly lacking.  And, more than anything else, his steady stream of lies, among over 20,000 overall, about the seriousness of the coronavirus pandemic, and his failure to take earlier and more measures to protect American public health, has given him real culpability for the 221,000 national covid-19 deaths, 8.3 million cases, and resultant astronomical private and public expenses.  Overall, with few if any significant accomplishments to put against these, Donald Trump has been virtually exclusively destructive.

Yet, as of Wednesday evening, the sportsbook.ag odds against reelection were only 71 to 40.  How do Trump’s tens of millions of expected voters justify their choice?  Mostly it is symbolic – he represents opposition to the political establishment, to political correctness, to the real or imagined problems caused by immigrants, and to scary national change in general.  As George Will put it, he is a weak man’s idea of what a strong man is like.  Otherwise, his supporters are likely to believe various conspiracy theories, that Biden would install “socialism” (in other words, more adversity benefits than they would prefer), that he has prevented bad things other than those he has done himself from happening, and that nobody else could have bettered his pandemic performance.  Some believe he has, despite data to the contrary, created jobs or helped the economy.  He gets much support from the richest, who hope his policies will help them as well as himself.  Their case is so weak that about 95% of newspaper endorsements, including those from conservative editorial staffs (maybe since he is not a conservative), have gone against him.

I have no expectations that Joe Biden would be a great president.  I do think that he would be good enough to reassure Americans and others that this country is on the way back, as Gerald Ford did so well after Nixon.  Given where we are, that is solidly enough reason to support him.  After the initial recovery, we can rediscover reasonable issue identification, debate, and resolution.  As for additional candidates, they have not only been invisible this time but, for people in states with uncertain electoral outcomes, this is not the year to consider them.  While I encourage all allowed people to vote on or before November 3^rd, the choice has never, during my lifetime, been this clear-cut.

Royal Flush Press endorses Joe Biden for president.

Covid-19: Our Situation Evolves – Part 2

 We start with a grim milestone, per Richard Perez-Pena in the September 28^th New York Times: “Coronavirus Deaths Pass One Million Worldwide.”  It’s “still growing fast,” and “may already have overtaken tuberculosis and hepatitis as the world’s deadliest infectious disease.”  That took ten months from the pandemic’s very beginning – how long will it be until it doubles?

Citing someone who probably didn’t expect to be discredited by the presidential administration which hired him, “Dr. Anthony Fauci assures Americans they can trust credibility of COVID-19 vaccine process” (Shawn Mulcahy, Yahoo News, October 2^nd).  Fauci didn’t like that “so many people are reticent to get a vaccine,” due to “mixed messages that come out of Washington,” and, per unnamed “experts” Mulcahy invoked, “it likely will not be widely available until late 2021.”  It’s been a slow month or so for specific publicized progress steps there, but the vaccine process, before then, seemed on track for sooner.  Leah Groth referenced the same subject in “Dr. Fauci Predicts When Life Will Be ‘Normal’ Again,” in the same publication a day later, where the physician projected that “masks and social distancing are going to be the norm for over a year at least.” 

Our perception of how the virus is most likely to spread has changed since March’s emphasis on frequent handwashing and avoiding touching surfaces, but since then we have learned that these are low priority.  In The Atlantic on September 29^th, Zeynep Tufecki took that further in “This Overlooked Variable Is the Key to the Pandemic.”  The author’s rambling 13-page article focused on a scientific finding that “this is an overdispersed pathogen, meaning that it tends to spread in clusters.”  That seemed to translate into avoiding crowded indoor gatherings with poor ventilation “where many people congregate over time – weddings, churches, choirs, gyms, funerals, restaurants and such – especially when there is loud talking or singing without masks.”  The worst known event to date was in a large Korean church, where one person spread the coronavirus to 5,000 others.  That may explain why outdoor events, such as the Sturgis motorcycle festival, have not caused huge numbers of cases.  If it is, indeed, 2022 before we can lose the masks, we may be able to accept seeing more and more people, if we are outdoors.

With the holidays coming up, we would all like to know “How to Tell If Socializing Indoors Is Safe” (Olga Khazan, The Atlantic, October 12^th).  The author maintained that such get-togethers, although “no indoor gathering will be perfectly safe,” are much less dangerous in areas with low infection rates, which might be defined as fewer than 10 new cases per day per 100,000 population.  Although Khazan called such data “not widely known,” it is updated daily by county on the front page of the New York Times website, under “U.S. hot spots.”  That also should become more common working knowledge in the potentially bleak year to come.

We end with good news, addressing an ongoing concern peaking recently: “Coronavirus Reinfections Are Real but Very, Very Rare” (Apoorva Mandavilli, October 13^th, The New York Times). There are only three such confirmed and 20 such review-awaiting cases in the world, and per article subheads, “in most people, the immune system works as expected,” and “a resurgence of symptoms doesn’t prove reinfection.”  So, although there is plenty to be concerned about with this pandemic, don’t bother about that – once, which is plenty enough, seems to almost always be the limit.  And, as well, “vaccines may be crucial to preventing reinfections.”  We will wait patiently and hope those materialize relatively soon.

Covid-19: Our Situation Evolves – Part 1

 We are still completely into the pandemic.  Here is yesterday morning’s New York Times view of how new cases are concentrated in the US, with the brightest red areas having over 56 per day per 100,000 population:

Nationally, the 7-day average, since bottoming out at September 13^th’s 35,073, has increased nearly daily to Wednesday’s 45,660.  Deaths, though, have been drifting down, from 734 to 700.  Wisconsin north of Milwaukee, in and around quality-of-life-survey-winning cities such as Appleton and Green Bay, is a strange place to be getting the worst of it – perhaps this is related to binge drinking and per-capita alcohol consumption.  While most of the rest of the country has gone up and down, the Northeast, where people have consistently worn masks and practiced social distancing and leadership has been quicker to pull back on allowed gatherings when outbreaks pop up, has mostly maintained light colors since April. 

At the same time, new infections worldwide have increased almost day-by-day since the pandemic began, with September 13^th and October 7^th 271,765 and 312,534 7-day averages.  They have been high in some surprising places, as here with dark red showing places with 14 per 100,000, some of which imply the danger of slacking off:

 

What other issues are getting attention?

In case anyone has wondered why this headline has faded away, “The Sturgis Biker Rally Did Not Cause 266,796 Cases of COVID-19” (Jennifer Beam Dowd, Slate, September 10^th).  Dowd found faulty reasoning causing that early September conclusion, corroborated, as we will see, indirectly by others. 

The New York Times Editorial Board finally addressed our absent governmental agency on September 14^th in “Under Trump, OSHA’s Covid-19 Response Is Failing Workers.”  The piece noted that meat processing facilities, in two of which 12 workers died of the infection early, were given small fines, one less than $4,000 per dead employee, and OSHA “has issued only general guidelines based on C.D.C. recommendations that were never mandatory,” neutralizing its mission of keeping workplaces safe.  That same day, that publication released Donald G. McNeil Jr.’s “Gates Offers Grim Global Health Report, and Some Optimism.”  The subject, Bill of course, advocated $4 billion in American aid to poorer countries for the vaccine we hope to get soon, which may seem large to some but is much smaller than George W. Bush’s 2003 $15 billion on AIDS, malaria, and tuberculosis. 

The disheartening opinion piece, “Stop Expecting Life to Go Back to Normal Next Year,” by Aaron E. Carroll, appeared September 15^th, also in the Times.  Per Carroll, our impatience, both in our national disposition and in our executive branch, has given us “unrealistic optimism,” overestimation of “what a vaccine might do,” and once that drug arrives Americans “will throw themselves back into more normal activities,” which “could lead to big outbreaks, just as winter hits at its hardest.”  He projected the first half of 2021 to require much the same restrictions as now, and reminded us, once more, that “this is a marathon, not a sprint.”  In the meantime, also on September 15^th, we expect “South Korea to provide coronavirus vaccines for 60% of population:  report” (Kayla Rivas, Fox News), helped not only by its high national cohesion but its compact, urbanized population.  Seven days later, Peter Doshl and Eric Topol, professors in medicine and pharmacy, doubted vaccine research methods in The New York Times’s “These Coronavirus Trials Don’t Answer the One Question We Need to Know,” namely, if the product will “prevent moderate or severe cases.”  I hope these companies are more aware of that problem then the authors suspect.

Finally for this week we have Sarah Zhang’s “Vaccine Chaos Is Looming,” in the September 27^th Atlantic.  Here we get into the same problem I documented several weeks ago, about American will to successfully complete large complicated projects.  Our infrastructure is world-class, there is an ample supply of available skilled workers, we have vehicles galore, our management and organization are well-established, and we know how high the priority is and must be, so why do we need to worry that “millions of doses must travel hundreds of miles from manufacturers to hospitals, doctor’s offices and pharmacies, which in turn must store, track, and eventually get the vaccines to people all across the country”?  Are we wondering if we can complete, per a cited source, “the largest, most complex vaccination program ever attempted in history,” even if “the vaccines are too precious to risk shipping conventionally”?  Can we fix problems such as “Medicare doesn’t cover the costs of emergency-use drugs”?  Do we have what it takes?  If not, why not? 

More next week. 

September’s Economic Data: Unemployment Down to 7.9% with AJSN Showing Latent Demand for 1.3 Million Fewer Jobs, Both Good Numbers with Coronavirus Cases Declining

In some ways, today’s Bureau of Labor Statistics Employment Situation Summary may seem disappointing.  The number of net new nonfarm positions, at 661,000, missed its 850,000 published projection.  Seasonally adjusted unemployment fell only 0.5%.  The labor force participation rate, now 61.4%, dropped for the first time since April, and the employment-population ratio improved only 0.1% to 56.6%.  Average hourly private nonfarm payroll earnings held at $29.47, meaning that those with lower pay rates have generally not been those returning to work, and the number of people jobless for 27 weeks or longer, now including those from the pandemic’s beginning, jumped 800,000 to 2.4 million. 

However, one thing was excellent.  The 7-day weighted average of new daily Covid-19 cases fell, from August 16^th to September 16^th, from 51,603 to 39,964, over 24%.  That means those 661,000 positions were not gained by tolerating more infections.  Other positive outcomes included unadjusted unemployment, down 0.8% to 7.7% (more than the adjusted rate improved, since many go back to work in September), the count of jobless down 1,000,000 to 12.6 million, those on temporary layoff diving from 6.2 million to 4.6 million, and the number working part-time for economic reasons, or looking thus far unsuccessfully for full-time work while keeping some with shorter hours, off 1.3 million to 6.3 million.

The American Job Shortage Number or AJSN, the metric showing how many additional positions could be quickly filled if all knew they were generally easy to get, while 7.8 million higher than a year before, improved substantially to the following:

Almost all the AJSN’s 1.3 million improvement came from lower official unemployment.  The counts of those marginally attached to the labor force, in the second through seventh rows above, fell only about 100,000, the least progress in five months.  The share of the AJSN from those officially jobless is again under 50% at 48.1%.  The AJSN is now 11.3 million below its April pandemic high, over halfway to its best early 2020 result.

What should we make of this morning’s findings?  People seem to be adjusting to the pandemic, including leaving the labor force – over 1.2 million more reported no interest in working than in August – or staying on its edges, if they are not optimistic about their working prospects.  That means the unemployment rates understate more than usual.  But even if we factor them up, we are left with a good jobs gain combined with real coronavirus progress.  That is the combination we need, even if it is slower than we might hope for.  The turtle, then, took another solid step forward.