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“The technology is just a shiny shopfront”: the case against the sharing economy

Uber isn't special because it has an app – it is special because it has billions in venture capital funding behind it. 

Tom Slee, a British-born software designer, lives in Waterloo, Ontario, a place better known as the home of Blackberry. As a result, he tells me over the phone shortly after the release of his book, “we’re quite familiar with companies that seem to be the future, but turn out not to be, after all”.

What’s Yours is Mine: Against the Sharing Economy is a painstaking examination of the latest set of companies claiming a chunk of our future. AirBnB, Uber and apps that send you anything from dinner to a cleaner all claim that they’re portals, upon which vendors and customers can “share” (or “buy and sell”, as we’ve called it for thousands of years) their products. At first glance, it’s a utopian vision, which bypasses all the nastiness of Big Business. Yet Slee’s book redraws the landscape in harsher terms, as a group of companies backed by enormously wealthy “old-school venture capitalists” which count themselves out of the rules and regulations that other companies are bound by.

“Intimacy scaled up is no longer intimacy”, Slee points out in the book, yet the companies rely on that word, “sharing” to bypass expensive laws and regulations. They’re bound by a Catch-22, in which they must seem small and intimate for their models to work and appeal, but they must be enormous and world-consuming to make the kind of money their investors require.

Slee was exposed to the concept of the “sharing economy” early on through his work in the tech industry, and from the beginning he was sceptical. But he says the doubt really set in when he completed a data analysis of AirBnB’s New York Listings in 2013. He found what he calls “a somewhat different pattern” to AirBnB’s claim that most of its users are occasionally renting out spare rooms.

“In particular, it showed that probably 40 per cent of their business comes from people with multiple listings,” he tells me now. Meanwhile, the people renting out a room in their house make up, according to the data, “about two to three per cent of their business. Really a tiny fraction”. In its conclusion, Slee acknowledges that the book comes from a “sense of betrayal” that an ideology sold as “an appeal to community, person to person connections, sustainability and sharing” has become the playground of billionaires.

I ask Slee if the companies themselves are aware of the sleight-of-hand that allows for their enormous growth and resistance to regulation, all the while claliming they’re operating for the social good. “It seems to be a defining characteristic of Silicon Valley that it manages to believe in both at the same time,” he says. “It’s in their interests not to ask too many questions about the conflicts between these two motives.” Of course, some companies are more aware of the trick than others: AirBnB, he argues, is still convinced of its ethical high ground, while “few who work for Uber” probably are. 

It helps that it’s become de rigeur to mock bureaucracy and human resources departments, even as we bemoan zero-hour contracts and acknowledge that labour rights fought for over centuries are slipping away. “I’ve sometimes found myself defending those boring structures and then come away thinking ‘am I really advocating for HR departments?” Slee says. Some demystification of company structures wouldn’t go amiss in most industries, yet the sharing economy’s offering seems to be to remove them altogether. 

The same shift in public opinion that favours start-ups over old models seems to have impacted our trust in governments. Yet as Slee points out, we shouldn’t allow this to happen without a fight: You talk about government – the role of government – now, and there’s very little receptiveness to that. Governments are a manifestation of democracy. To me when democracy fails, the solution is more democracy, not to walk away from it.”

Slee sees the sharing economy as an ourgrowth of “solutionism”: the idea that there are easy solutions to complex social problems. We’re all prey to this mode of thinking, which is perhaps why we place otherwise unimaginable levels of trust in any venture with technology connected to it. We climb into Ubers far more trustingly than into unlicensed minicabs. In the current FBI v Apple debate, we find ourselves placing more trust in a giant company than in a democratically elected government. It remains to be seen whether this trust is misplaced or not – but in an increasingly cynical world, its existence is worth re-examining.

The book undermines not only the sharing economy, but the whole concept of tech-based ventures. We think of apps as primarily technological; we think of Silicon Valley as a concentration of tech talent. But Slee puts it another way: “Increasingly, it seems to me that the defining thing there is the concentration of money and investment.” Uber isn’t special, he argues, because it has an app: “What Uber has is $8bn to spend.” This is what drives competitors, like London’s black cabs, crazy. It’s not as simple as getting an app.

Because of their financial backing and fast growth, tech companies can become enormous and profitable to a point where they can defend less-than-ideal labour policies or approaches that undermine local laws. Their immense popular appeal allows them to paint sparring matches with local governments as David vs Goliath, despite the fact that they’re global companies with more than enough cash to spring for lawyers and spin campaigns.

We need to understand that technology, like weapons, enables the spread of ideology or new kinds of business or politics, but it doesn’t create them. The early ethics of the internet may have been pleasingly liberal – free content for all, equality, an end to prejudice –  but its content is always reflective of the people behind it, not the technology itself.

“The technology is just a shiny shopfront,” Slee says. “But behind that there’s all the logistics operations that goes on, and that’s a huge part of the sharing economy's success. And in particular, finding ways to cut down costs by basically passing them on to other parts of the system.”

Legislators, meanwhile, are beginning to fight back. Italy’s Sharing Economy Act sets out definitions of the sharing economy for the first time, thereby treating it as differnt from other businesses, but this endeavour is basically aimed at taxing the sharing economy properly. The days of loopholes, it seems, may be numbered. 

As Boston lawyer Shannon Liss-Riordan said of Uber while fighting their worker/contracter laws: “Just because your services are dispatched through a smartphone doesn’t make you a technology company. You’re a car service.”

Barbara Speed is comment editor at the i, and was technology and digital culture writer at the New Statesman, and a staff writer at CityMetric.

Nigel Farage and Paul Nuttall. Photo: Getty
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Nigel Farage and Douglas Carswell don’t need to stand again as MPs – they’ve already won

I just loathe these people. I want to see them humiliated. 

We’re a week in to the campaign, and it’s clear that the 2017 election is going to be hell on toast. The polls show the Tories beating Labour in Scotland (for the first time in a generation) and Wales (for the first time in a century). The bookies put the chances of a Labour majority at around 20/1, odds that are striking mainly because they contain just one zero.

The only element of suspense in this election is whether Theresa May will win a big enough majority to keep Labour out of power for a decade, or one big enough to keep it out for an entire generation. In sum: if you’re on the left, this election will be awful.

But there was one bright spot, a deep well of Schadenfreude that I thought might get us through: the campaign would provide plentiful opportunities to watch the people who got us into this mess be humiliatingly rejected by the electorate yet again.

After all, Ukip’s polling numbers have halved since last summer and the party has fallen back into fourth place, behind the pro-European Lib Dems. Nigel Farage has failed to become an MP seven times. It thus seemed inevitable both that Farage would stand, and that he would lose. Again.

If the vexingly popular Farage has never made it to parliament, the odds that his replacement as Ukip leader, Paul Nuttall (the Walter Mitty of Bootle), would manage it seemed minimal. Ukip may have won last year’s referendum; that did not mean its leaders wouldn’t still lose elections, preferably in the most embarrassing way possible.

The true highlight of the election, though, promised to be Clacton. The Essex seaside town is the only constituency ever to have returned a Ukip candidate at a general election, opting to let the Tory defector Douglas Carswell stay on in 2015. But Carswell’s libertarian belief that Brexit was definitely not about immigration always seemed an odd fit with Ukip, and he left the party in March. In the upcoming election, he seemed certain to face a challenge from the party’s immigration-obsessed donor Arron Banks.

The Clacton election, in other words, was expected to serve as a pleasing metaphor for Ukip’s descent back into irrelevance. The libertarians and nativists would rip chunks out of each other for a few weeks while the rest of us sniggered, before both inevitably lost the seat to a safe pair of Tory hands. This election will be awful, but Clacton was going to be brilliant.

But no: 2017 deprives us of even that pleasure. Carswell has neatly sidestepped the possibility of highlighting his complete lack of personal support by standing down, with the result that he can tell himself he is quitting undefeated.

Carswell has always stood apart from Ukip but on this matter, at least, the party has rushed to follow his lead. Arron Banks spent a few days claiming that he would be running in Clacton. Then he visited the town and promptly changed his mind. At a press conference on 24 April, Paul Nuttall was asked whether he planned to stand for a seat in Westminster. Rather than answering, he locked himself in a room, presumably in the hope that the journalists outside would go away. Really.

As for Farage, he seems finally to have shaken his addiction to losing elections and decided not to stand at all. “It would be a very easy win,” he wrote in the Daily Tele­graph, “and for me a personal vindication to get into the House of Commons after all these years of standing in elections.” He was like an American teenager assuring his mates that his definitely real Canadian girlfriend goes to another school.

Why does all of this bother me? I don’t want these people anywhere near Westminster, and if they insisted on standing for a seat there would be at least the chance that, in these febrile times, one of them might actually win. So why am I annoyed that they aren’t even bothering?

Partly I’m infuriated by the cowardice on show. They have wrecked my country, completely and irrevocably, and then they’ve just legged it. It’s like a version of Knock Down Ginger, except instead of ringing the doorbell they’ve set fire to the house.

Partly, too, my frustration comes from my suspicion that it doesn’t matter whether Ukip fields a single candidate in this election. Theresa May’s Tories have already assimilated the key tenets of Farageism. That Nigel Farage no longer feels the need to claw his way into parliament merely highlights that he no longer needs to.

Then there’s the fury generated by my lingering sense that these men have managed to accrue a great deal of power without the slightest hint of accountability. In the south London seat of Vauxhall, one of the most pro-Remain constituencies in one of the most pro-Remain cities in the UK, the Labour Leave campaigner Kate Hoey is expected to face a strong challenge from the Liberal Democrats. Even Labour members are talking about voting tactically to get their hated MP out.

It remains to be seen whether that campaign succeeds but there is at least an opportunity for angry, pro-European lefties to register their discontent with Hoey. By contrast, Farage and his henchmen have managed to rewrite British politics to a degree that no one has achieved in decades, yet there is no way for those who don’t approve to make clear that they don’t like it.

Mostly, though, my frustration is simpler than that. I just loathe these people. I want to see them humiliated. I want to see them stumble from gaffe to gaffe for six weeks before coming fourth – but now we will be deprived of that. Faced with losing, the biggest names in Ukip have decided that they no longer want to play. And so they get to win again. They always bloody win. 

Jonn Elledge edits the New Statesman's sister site CityMetric, and writes for the NS about subjects including politics, history and Daniel Hannan. You can find him on Twitter or Facebook.

This article first appeared in the 27 April 2017 issue of the New Statesman, Cool Britannia 20 Years On

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