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This isn't how I see the discourse. The way I see it is people are starting to question if executives and shareholders deserve the pay they get. Instead of the

This isn't how I see the discourse. The way I see it is people are starting to question if executives and shareholders deserve the pay they get. Instead of the majority of profits going to them, more should go to workers. The author of this article was paid $42 million last year. Uber's top 7 executives received: "$11.4 million in salary and cash bonus, plus $71 million worth of equity awards." [0] Maybe instead of paying their CEO and executives that much, Uber should pay their workers more? [0] https://observer.com/2020/05/uber-ceo-pay-shareholder-backlash-coronavirus/ https://observer.com/2020/05/uber-ceo-pay-shareholder-backla...

SpicyLemonZest 6y ago
If we take Uber's self-reported total of 3 million drivers, that'd give them an extra $15 a year. That's not really the scale of change most people are looking for when they say workers should make more.
- deleted 6y ago
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- aetherson 6y ago
  It's appalling to me that this basic reality check is getting downvoted.
  - SpicyLemonZest 6y ago
    I'm used to it, unfortunately. Something's gone very wrong with the discourse in almost every forum I frequent; hopefully it's just temporary pandemic stress.
- sukilot 6y ago
  Right. Uber (single user per ride car service) is a fundamentally unsustainable business model, unless they convert into vanpool and delivery routes.
  - ac29 6y ago
    According to the Q1 reports, rides are actually profitable for the company. They just lose money on other segments, like Eats, and spend an absolutely massive amount of money on "platform R&D" (many hundreds of millions per quarter). https://investor.uber.com/news-events/news/press-release-details/2020/Uber-Announces-Results-for-First-Quarter-2020/ https://investor.uber.com/news-events/news/press-release-det... (not I am using Q1, because Q2 has been an... atypical quarter for this sort of business)
sbarre 6y ago
I think OP's point is that if the US had a better social safety net, this problem wouldn't be as bad. So many people in the US - arguably still the world's most prosperous country - live on the precipice of ruin and failure because their country just doesn't give a shit about them (hence the ongoing push to make their _employer_ give more of a shit about them), and it's really heartbreaking.
- deleted 6y ago
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- Frost1x 6y ago
  >...because their country just doesn't give a shit about them... To add insult to injury, every party involved that doesn't give a shit about them, yet benefits from not giving a shit about them, also pretends to give a shit about them. The entire "essential worker" hero ad campaign at the start of COVID really put a bad taste in my mouth. Few if any of the businesses that ran those ad campaigns actually cared about their workers or felt they were heroes (if they did, they'd treat them with basic human decency, which they don't). Instead, they treat them like garbage, lie to them, and lie to everyone else portraying that they somehow don't treat their workers like garbage. Modern corporate propoganda (that's what it is, no matter what you want to relabel it) is pretty disgusting, especially in the fact that it's successful. We've really lost our humanity in this system and it's some of the subjective yet arguably "good" or positive attributes of humanity.
  - sbarre 6y ago
    > Few if any of the businesses that ran those ad campaigns actually cared about their workers Agreed, but ultimately the responsibility to care for all citizens should fall on the government first. Anyone who lives in a country should feel supported and cared for by their government. That's literally why it exists. Employers should certainly care for their employees as well, but that should be an added benefit, not the primary safety net.
    - mushufasa 6y ago
piva00 6y ago
I see the discourse being more about bringing some basic morality to this amoral system we live in, we have experienced enough the lack of humanism when this system is left unchecked. Morality here is about treating workers with a minimum level of dignity based on human rights, it's about paying us more fairly given that we are the ones producing value (the maxim that "an idea is nothing without execution" should be taken up by the investor/entrepreneur class also, without workers your idea is fucking nothing). It's also about making corporations abide by the rule of law that every other citizen has to, we need a more moral and just system, this free for all of Darwinian economics is a shit system given our current technological capabilities as humanity.
- sbarre 6y ago
  > Morality here is about treating workers with a minimum level of dignity based on human rights Why "workers", why not "citizens" or "people"? The tragedy in the US is that the government has successfully abdicated its responsibility to care for its people and has convinced everyone that they must be defined by their job, or by their productivity, and that any societal benefits or safety net they obtain in life is a reward for that work, as opposed to simply having it because their country cares for them. If you want to bring "human rights" into the conversation, let's stop connecting it with compensation and productivity. Edit: on re-read, it sounds like I'm arguing with you or rebuking what you're saying. I'm not. I agree with what you're saying, just adding on that it should be a broader conversation. =)
  - Nasrudith 6y ago
    The "why workers" is partially history and social contract as a framework for incentives which has a long legacy. If they contribuite to the system then they have a claim to the basics. If they don't why bother working? If they were voluntarily idle then there would be a harsh factual basis of not being enough to feed them when there was work to be done. That was the logic of the past anyway. It may not be a right or good answer but it is /a/ reason. Obviously things change with time and we are on an appatent trajectory to an "awkward middle" of both needing people to do some advanced work and outrunning useful tasks performable by everyone. Incentivizing upskilling to those who can perform non-automatable jobs while avoiding a defacto fixed underclass makes it extra awkward.
rguzman 6y ago
> The author of this article was paid $42 million last year. Uber's top 7 executives received: "$11.4 million in salary and cash bonus, plus $71 million worth of equity awards." it's misleading to call equity compensation "getting paid". there's a strong argument that executives are being over-payed, but say the CEO receiving a salary of ~1.6M (11.4/7) is a lot less egregious than them being paid $42M. surely the equity conferred to the execs gets them some cash availability in various ways, but it isn't exactly the same as just giving them money (eg what would happen if the CEO uber sold off all of his stock?). maybe the cash portion of exec salaries ought to be much lower or maybe their equity compensation ought to be much lower, but i don't think either of these things by itself or in combination is going to solve the structural problems of the american economy such as healthcare being tied to employment.
- jolux 6y ago
  This is kind of a red herring because while you’re right that it would be a bad sign for a CEO to dump all their stock, they have access to whatever liquidity they need through it, and are likely going to diversify their gains.
- Miner49er 6y ago
  I agree, equity is likely even more valuable then the price given. It gives part ownership and voting rights in Uber. The employees could collectively use their voting rights to have a voice in the direction of the company.
- generalk 6y ago
  > it's misleading to call equity compensation "getting paid". Please. A person who has a portfolio worth tens/hundreds of millions of dollars does not have to liquidate it to leverage its value. They can secure cash loans on extremely preferential terms backed by their assets, for one. Futher, who cares if it's "exactly the same as giving them money" or not? That doesn't change the inequality inherit in such compensation packages, just how they pay taxes. > [neither reducing cash or equity comp] is going to > solve the structural problems of the american economy > such as healthcare being tied to employment. Sure, that's true, but that's also a fine way to allow wealth inequality to continue unchecked. Jeff Bezos can't be worth over $100B unless his company is vastly underpaying and mistreating its workers.
CrazyStat 6y ago
Uber's cost of revenue for 2019 was $7.2 billion [1]. That's not all driver payments, but it's fair to assume that a big chunk of it is. If the executives received no salary they could pay the drivers an extra 0.2% or so. If the executives received no compensation whatsoever they could pay the drivers an extra 1-2%. [1] https://investor.uber.com/news-events/news/press-release-details/2020/Uber-Announces-Results-for-Fourth-Quarter-and-Full-Year-2019/ https://investor.uber.com/news-events/news/press-release-det...
- Klinky 6y ago
  Operations and Support seems to be the smallest chunk of that at 2.3 billion. I am not sure if that's the pool of money drivers are paid out of. It would be better to see the actual cost paid to drivers instead of assuming "a big chunk", as to me it's looks like a smaller chunk of the smallest chunk.
alteriority 6y ago
I don't fully dispute your point, but 42 million divided by 900,000 is 46 dollars per worker per year. And, last I paid attention, my impression was that Uber was already hemorrhaging VC money. 42 million for the CEO strikes me as extravagant, but that alone is a drop in the bucket compared to the amount required to give every driver a noticeable boost in income. Intuitively, it feels like the only sustainable way to do that is to raise the cost of every ride. Why they don't do that...probably comes down to a spreadsheet that tells them it will lose them money in the long term.
- ericd 6y ago
  It could be that people aren’t actually interested in paying taxi rates on a regular basis, but that those are what’s necessary to support a reasonable wage for the drivers.
  - alteriority 6y ago
    Agreed. I think the natural level will regress to something in the middle--the price was artificially high before from exorbitant taxi medallion prices and protectionist laws, and now it's artificially low from an influx of VC cash. One thing of note: I lived in a semi-rural college town in the USA, with very few uber drivers but a fairly active "beeper" group organized on facebook--born of a designated driver system that expanded into general use--where people would manually post that they were available to drive or needed a driver. The infrastructure wasn't very good, and there's no real reputation system aside from word of mouth, but it stands as a proof of concept. In theory, now that the idea's in the air, just about anyone could just slap a front-end on a routing system and cut Uber's take out entirely, as long as they're willing to deal with the responsibility (or absence) of things like payment processing and liability for things that transpire on their system.
SergeAx 6y ago
"according to CNN there were 750,000 Uber drivers in the US in 2017. That's an increase from 327,000 Uber drivers in the US in 2015" [0] So, let's assume that there were 1m Uver drivers in US in 2019 and set aside all other counries' markets. If we split $42m + $11m + $71m between them instead of top managers, they will get ~$10/month. Will you feel better with this change of Uber expenses structure? [0] https://hedgescompany.com/blog/2018/10/number-of-licensed-drivers-usa/ https://hedgescompany.com/blog/2018/10/number-of-licensed-dr...
ksdale 6y ago
That compensation divided among Uber's approximately 27,000 employees results in about $3,000 per employee, but Uber's employees are probably mostly software engineers, so $3,000 per person is mostly not life-changing. A quick googling says that 3 million people "drive for Uber." Paying them what the high-flying executives make would mean a few dollars per person. I completely understand the impulse to question the huge disparity in salaries, but for the most part, executives that get paid that much work at gigantic companies, where hundreds of millions of dollars is an almost irrelevant pay increase when distributed across all of the employees.
- panarky 6y ago
  > Paying them what the high-flying executives make would mean a few dollars per person Let's radically simplify Uber's stakeholder into five classes: executives, investors, engineers, full-time drivers and occasional drivers. Each of these five classes of stakeholders have contributed to create Uber's market valuation of $55 billion. The first three classes are already well compensated because executives, investors and engineers have negotiating leverage. But the full-time drivers are the one stakeholder class that created much of Uber's value yet receive very little of the value they created. Maybe they're 10% of the total driver base, or 300,000 workers. How much of Uber's value do they deserve?
  - gsibble 6y ago
    Key principal taught in business school: pay people what it costs to replace them. Which in Uber's case is very low.
    - inetknght 6y ago
      > taught in business school The school is ethically wrong here.
      - robertpateii 6y ago
        Now we’re back to the opening comment: who’s job is it ethically to ensure people receive a living wage? The companies that employ some people or all of us?
bhahn 6y ago
It’s also not that simple. Uber does not operate in a vacuum. There are other companies against which Uber is competing for executive talent and one of the variables is compensation. If Uber started offering much less than its competitors, then they would be at a significant disadvantage in hiring.
Shivetya 6y ago
tl;dr I am so tired of this stupid idea, it ignores the simple fact of work. Not all work is equal as not all people are of equal ability. It is damn easy to declare someone is underpaid or overpaid. Especially when you don't have to write the check. Far too many assume they can do the job of the over paid because they truly understand all the aspects of the job. Sports stars, movie stars, state leadership positions, and more, all follow the same trend. So what is your point exactly? Seriously go look up what some county managers make and get back to me, here is a hint, it is not uncommon for many to make over a hundred thousand and quite a few approach a quarter million or more and you can damn well bet there are people working in your local government earning minimum wage. Why aren't people here bitching about overpaying government employees? Upper admin in any government is big bucks but that school cafeteria worker certainly isn't seeing a fair share are they? As in, all work is not equal nor does it deserve equal pay. Never has, never will. Would you accept the same pay especially if it had to be lowered to insure the receptionist earns similar to you? What about the cafeteria worker? Yes I am going there. Why not. If we are going to declare a CEO makes to much then we cannot stop there after all we would be hypocritical. If anything the owners, be it shareholders or individuals, decide what is paid our and theoretically could take every dollar after what was decided as fair compensation was achieved
- grugagag 6y ago
  It is not a stupid idea when people work and are below the surviving threshold even if they have multiple jobs. Something's wrong but it's hard to see from your vantage point. And let me remind you that the lower one gets paid the harder and ass busting the work is.
anm89 6y ago
The irony of statements like this, is that by directing a huge amount of the energy created by a sense of the unfairness of how modern large corporations work to absolutely stupid proposed solutions like this which are so detached from the reality of how the modern economy works that they have 0 chance of ever being enacted at scale, you actually enable the corporations to get away with more because the people opposing them look like a bunch of morons who don't understand the system they are fighting.
- volkk 6y ago
  i see the point youre making, but i'm interested in hearing more about how the economy works, and which reforms are laudable vs which are moronic
  - anchpop 6y ago
    The idea that everyone deserves a living wage from their employer has its heart in the right place but is wrong-headed. The reason is twofold: employers will attempt not to pay a living wage anyway, and it ignores the unemployed The better goal is to say that everyone deserves an income sufficient to make it possible to buy the things they need in life, even if they aren't employed. The best way to do this is with a robust welfare state, or a UBI. If you could survive just fine in perpetuity without a job, many people would choose to stay home and play videogames unless the jobs available to them made it truly worth their while.
  - anm89 6y ago
    These ideas are problematic in so many different directions that without hearing which version of it is being proposed, it's a little hard to argue. I mean generally speaking, through which mechanism are you proposing telling people that they no longer have the right to make more money, even though people want to buy goods and services from them. Is it a hard cap? Some kind of ratio (which will surely be gamed to hell), is it case by case? Who sets the cap or ratio? Who is the minister of punishing rich people who decides that 5 billion isn't really a problem but 40 billion is just where to draw the line. Or is it because some guy bought a boat that was just a little too ostentatious (maybe he can send it back to the boat yard to have it trimmed up by 10 meters and evade the ruling). Do you see where this gets silly and is ripe for abuse? Let's say you miraculously manage to pull this off, then you'd have to wait the entire 10 minutes until Bezos Zuck and Buffett, shift half of their stock into a trust owned by family members that amazingly keeps them all just under the cap for long enough for them to do the same to redistribute to their heirs. Like, do you thing those guys are just going to call it quits because of this? They have all the money they need. Zuck probably doesn't wake up in the morning motivated by making another billion. He's playing a different meta-game. Also, it's very hard for me to imagine a version of the process for implementing this that does not look like some political theater McCarthy hearingesque which-hunt. Finally, whether you are reasonable or not, I know many people who would love to set these caps at absurd points. The coworking space I work at has the local chapter of Maoists who meet up every week on Wednesdays. I doubt you'd make it to six figures before they set their line. Do you really want this to be up to a vote?. Meanwhile amazon payed negative corporate taxes if I recall correctly a few years ago, and has cities fighting hand over fist to optionally hand tax payer money back to them in lump sums as bribes to get HQ2. We have all sorts of other regressive taxes. Our whole tax code is designed to benefit huge corporations who can hire millions of dollars worth of lawyers to find loopholes at the expense of being totally unmanageable to small business owners who cover the difference. So yes, our system has a lot of problems and a lot of them aren't as emotionally gratifying as complaining about some rich guys 3rd helicopter, but many of them, if people took the time to learn about them could actually meaningfully changed these situations going forward as opposed to punishing a handful of people who profited off of the current backwards system.
epistasis 6y ago
Brainstorming an idea here, but what about a modification to the corporate tax rate based on something like the Gini coefficient of the compensation inequality of the workers. Want to add an extra $10M of compensation for your CEO for adding a one-quarter 2% boost? Pay an extra 0.2% in your corporate tax rate, or similar? The other end of the spectrum is of course capital gains for shareholders, but any of the wealth taxes proposed recently would help make that more stable. We are at French Revolution levels of inequality, with a pandemic, a president that despises the majority of US citizens but runs clubs where power-seeking wealthy people pay for admission, and we are not even building enough housing for an entire generation that's growing up. If we don't start addressing this inequality in substantial ways, we will see much greater unrest.
- dominotw 6y ago
  > Gini coefficient of the whole country or that specific region ?
  - epistasis 6y ago
    The coefficient of the specific employer's distribution of compensation, not the Gino coefficient of the entire population where they are located. It is a number that can be calculated for any distribution.
- sukilot 6y ago
  Trivially dodged by outsourcing.
  - epistasis 6y ago
    Definitely can be gamed, as anything can be, but I wouldn't call it trivial. Companies are reluctant to outsource their core competencies.
lallysingh 6y ago
Can we do this analysis with a profitable company? The value of the business is currently negative.
jimbokun 6y ago
> Maybe instead of paying their CEO and executives that much, Uber should pay their workers more? So do we task Congress with figuring out the correct compensation for every worker in the US? Or do we just greatly increase taxes on those high earning executives and distribute to those most in need?
maerF0x0 6y ago
The main aspect missing from these sentiments is risk adjusted return. As another commenter said, if employees want the profits of shareholders they should also risk a total loss of their investment. Now, I do think more companies should pay with (generous) equity and the government should do far more to support this model. Such as supporting earlier liquidity, less accredited investor rules, mandatory public listings above a certain valuation etc.
eagsalazar2 6y ago
The bottom line is that the labor market for unskilled workers is not competitive, keeping rates low, to the extreme benefit of Bezos (in this case). Mandating higher wages will result in extreme distortions. I'm not saying we shouldn't do that, as fixing the underlying labor supply problem is messy as hell, I'm just saying culling executive pay is probably just very distorting and probably won't solve the problem anyway. Why would they just give those $$ to employees? It has never been about "we can't pay you because we don't have any money left after paying execs". They would just save more in the bank that they can use to abuse smaller competitors even more. The root issue is for Amazon and many other businesses, the cost of doing business is way too low.

SpicyLemonZest 6y ago

If we take Uber's self-reported total of 3 million drivers, that'd give them an extra $15 a year. That's not really the scale of change most people are looking for when they say workers should make more.

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aetherson 6y ago
It's appalling to me that this basic reality check is getting downvoted.
- SpicyLemonZest 6y ago
  I'm used to it, unfortunately. Something's gone very wrong with the discourse in almost every forum I frequent; hopefully it's just temporary pandemic stress.
sukilot 6y ago
Right. Uber (single user per ride car service) is a fundamentally unsustainable business model, unless they convert into vanpool and delivery routes.
- ac29 6y ago
  According to the Q1 reports, rides are actually profitable for the company. They just lose money on other segments, like Eats, and spend an absolutely massive amount of money on "platform R&D" (many hundreds of millions per quarter). https://investor.uber.com/news-events/news/press-release-details/2020/Uber-Announces-Results-for-First-Quarter-2020/ https://investor.uber.com/news-events/news/press-release-det... (not I am using Q1, because Q2 has been an... atypical quarter for this sort of business)

sbarre 6y ago

I think OP's point is that if the US had a better social safety net, this problem wouldn't be as bad. So many people in the US - arguably still the world's most prosperous country - live on the precipice of ruin and failure because their country just doesn't give a shit about them (hence the ongoing push to make their _employer_ give more of a shit about them), and it's really heartbreaking.

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Frost1x 6y ago
>...because their country just doesn't give a shit about them... To add insult to injury, every party involved that doesn't give a shit about them, yet benefits from not giving a shit about them, also pretends to give a shit about them. The entire "essential worker" hero ad campaign at the start of COVID really put a bad taste in my mouth. Few if any of the businesses that ran those ad campaigns actually cared about their workers or felt they were heroes (if they did, they'd treat them with basic human decency, which they don't). Instead, they treat them like garbage, lie to them, and lie to everyone else portraying that they somehow don't treat their workers like garbage. Modern corporate propoganda (that's what it is, no matter what you want to relabel it) is pretty disgusting, especially in the fact that it's successful. We've really lost our humanity in this system and it's some of the subjective yet arguably "good" or positive attributes of humanity.
- sbarre 6y ago
  > Few if any of the businesses that ran those ad campaigns actually cared about their workers Agreed, but ultimately the responsibility to care for all citizens should fall on the government first. Anyone who lives in a country should feel supported and cared for by their government. That's literally why it exists. Employers should certainly care for their employees as well, but that should be an added benefit, not the primary safety net.
  - mushufasa 6y ago

piva00 6y ago

I see the discourse being more about bringing some basic morality to this amoral system we live in, we have experienced enough the lack of humanism when this system is left unchecked. Morality here is about treating workers with a minimum level of dignity based on human rights, it's about paying us more fairly given that we are the ones producing value (the maxim that "an idea is nothing without execution" should be taken up by the investor/entrepreneur class also, without workers your idea is fucking nothing). It's also about making corporations abide by the rule of law that every other citizen has to, we need a more moral and just system, this free for all of Darwinian economics is a shit system given our current technological capabilities as humanity.

sbarre 6y ago
> Morality here is about treating workers with a minimum level of dignity based on human rights Why "workers", why not "citizens" or "people"? The tragedy in the US is that the government has successfully abdicated its responsibility to care for its people and has convinced everyone that they must be defined by their job, or by their productivity, and that any societal benefits or safety net they obtain in life is a reward for that work, as opposed to simply having it because their country cares for them. If you want to bring "human rights" into the conversation, let's stop connecting it with compensation and productivity. Edit: on re-read, it sounds like I'm arguing with you or rebuking what you're saying. I'm not. I agree with what you're saying, just adding on that it should be a broader conversation. =)
- Nasrudith 6y ago
  The "why workers" is partially history and social contract as a framework for incentives which has a long legacy. If they contribuite to the system then they have a claim to the basics. If they don't why bother working? If they were voluntarily idle then there would be a harsh factual basis of not being enough to feed them when there was work to be done. That was the logic of the past anyway. It may not be a right or good answer but it is /a/ reason. Obviously things change with time and we are on an appatent trajectory to an "awkward middle" of both needing people to do some advanced work and outrunning useful tasks performable by everyone. Incentivizing upskilling to those who can perform non-automatable jobs while avoiding a defacto fixed underclass makes it extra awkward.

rguzman 6y ago

> The author of this article was paid $42 million last year. Uber's top 7 executives received: "$11.4 million in salary and cash bonus, plus $71 million worth of equity awards." it's misleading to call equity compensation "getting paid". there's a strong argument that executives are being over-payed, but say the CEO receiving a salary of ~1.6M (11.4/7) is a lot less egregious than them being paid $42M. surely the equity conferred to the execs gets them some cash availability in various ways, but it isn't exactly the same as just giving them money (eg what would happen if the CEO uber sold off all of his stock?). maybe the cash portion of exec salaries ought to be much lower or maybe their equity compensation ought to be much lower, but i don't think either of these things by itself or in combination is going to solve the structural problems of the american economy such as healthcare being tied to employment.

jolux 6y ago
This is kind of a red herring because while you’re right that it would be a bad sign for a CEO to dump all their stock, they have access to whatever liquidity they need through it, and are likely going to diversify their gains.
Miner49er 6y ago
I agree, equity is likely even more valuable then the price given. It gives part ownership and voting rights in Uber. The employees could collectively use their voting rights to have a voice in the direction of the company.
generalk 6y ago
> it's misleading to call equity compensation "getting paid". Please. A person who has a portfolio worth tens/hundreds of millions of dollars does not have to liquidate it to leverage its value. They can secure cash loans on extremely preferential terms backed by their assets, for one. Futher, who cares if it's "exactly the same as giving them money" or not? That doesn't change the inequality inherit in such compensation packages, just how they pay taxes. > [neither reducing cash or equity comp] is going to > solve the structural problems of the american economy > such as healthcare being tied to employment. Sure, that's true, but that's also a fine way to allow wealth inequality to continue unchecked. Jeff Bezos can't be worth over $100B unless his company is vastly underpaying and mistreating its workers.

CrazyStat 6y ago

Uber's cost of revenue for 2019 was $7.2 billion [1]. That's not all driver payments, but it's fair to assume that a big chunk of it is. If the executives received no salary they could pay the drivers an extra 0.2% or so. If the executives received no compensation whatsoever they could pay the drivers an extra 1-2%. [1] https://investor.uber.com/news-events/news/press-release-details/2020/Uber-Announces-Results-for-Fourth-Quarter-and-Full-Year-2019/ https://investor.uber.com/news-events/news/press-release-det...

Klinky 6y ago
Operations and Support seems to be the smallest chunk of that at 2.3 billion. I am not sure if that's the pool of money drivers are paid out of. It would be better to see the actual cost paid to drivers instead of assuming "a big chunk", as to me it's looks like a smaller chunk of the smallest chunk.

alteriority 6y ago

I don't fully dispute your point, but 42 million divided by 900,000 is 46 dollars per worker per year. And, last I paid attention, my impression was that Uber was already hemorrhaging VC money. 42 million for the CEO strikes me as extravagant, but that alone is a drop in the bucket compared to the amount required to give every driver a noticeable boost in income. Intuitively, it feels like the only sustainable way to do that is to raise the cost of every ride. Why they don't do that...probably comes down to a spreadsheet that tells them it will lose them money in the long term.

ericd 6y ago
It could be that people aren’t actually interested in paying taxi rates on a regular basis, but that those are what’s necessary to support a reasonable wage for the drivers.
- alteriority 6y ago
  Agreed. I think the natural level will regress to something in the middle--the price was artificially high before from exorbitant taxi medallion prices and protectionist laws, and now it's artificially low from an influx of VC cash. One thing of note: I lived in a semi-rural college town in the USA, with very few uber drivers but a fairly active "beeper" group organized on facebook--born of a designated driver system that expanded into general use--where people would manually post that they were available to drive or needed a driver. The infrastructure wasn't very good, and there's no real reputation system aside from word of mouth, but it stands as a proof of concept. In theory, now that the idea's in the air, just about anyone could just slap a front-end on a routing system and cut Uber's take out entirely, as long as they're willing to deal with the responsibility (or absence) of things like payment processing and liability for things that transpire on their system.

SergeAx 6y ago

"according to CNN there were 750,000 Uber drivers in the US in 2017. That's an increase from 327,000 Uber drivers in the US in 2015" [0] So, let's assume that there were 1m Uver drivers in US in 2019 and set aside all other counries' markets. If we split $42m + $11m + $71m between them instead of top managers, they will get ~$10/month. Will you feel better with this change of Uber expenses structure? [0] https://hedgescompany.com/blog/2018/10/number-of-licensed-drivers-usa/ https://hedgescompany.com/blog/2018/10/number-of-licensed-dr...

ksdale 6y ago

That compensation divided among Uber's approximately 27,000 employees results in about $3,000 per employee, but Uber's employees are probably mostly software engineers, so $3,000 per person is mostly not life-changing. A quick googling says that 3 million people "drive for Uber." Paying them what the high-flying executives make would mean a few dollars per person. I completely understand the impulse to question the huge disparity in salaries, but for the most part, executives that get paid that much work at gigantic companies, where hundreds of millions of dollars is an almost irrelevant pay increase when distributed across all of the employees.

panarky 6y ago
> Paying them what the high-flying executives make would mean a few dollars per person Let's radically simplify Uber's stakeholder into five classes: executives, investors, engineers, full-time drivers and occasional drivers. Each of these five classes of stakeholders have contributed to create Uber's market valuation of $55 billion. The first three classes are already well compensated because executives, investors and engineers have negotiating leverage. But the full-time drivers are the one stakeholder class that created much of Uber's value yet receive very little of the value they created. Maybe they're 10% of the total driver base, or 300,000 workers. How much of Uber's value do they deserve?
- gsibble 6y ago
  Key principal taught in business school: pay people what it costs to replace them. Which in Uber's case is very low.
  - inetknght 6y ago
    > taught in business school The school is ethically wrong here.
    - robertpateii 6y ago
      Now we’re back to the opening comment: who’s job is it ethically to ensure people receive a living wage? The companies that employ some people or all of us?

bhahn 6y ago

It’s also not that simple. Uber does not operate in a vacuum. There are other companies against which Uber is competing for executive talent and one of the variables is compensation. If Uber started offering much less than its competitors, then they would be at a significant disadvantage in hiring.

Shivetya 6y ago

tl;dr I am so tired of this stupid idea, it ignores the simple fact of work. Not all work is equal as not all people are of equal ability. It is damn easy to declare someone is underpaid or overpaid. Especially when you don't have to write the check. Far too many assume they can do the job of the over paid because they truly understand all the aspects of the job. Sports stars, movie stars, state leadership positions, and more, all follow the same trend. So what is your point exactly? Seriously go look up what some county managers make and get back to me, here is a hint, it is not uncommon for many to make over a hundred thousand and quite a few approach a quarter million or more and you can damn well bet there are people working in your local government earning minimum wage. Why aren't people here bitching about overpaying government employees? Upper admin in any government is big bucks but that school cafeteria worker certainly isn't seeing a fair share are they? As in, all work is not equal nor does it deserve equal pay. Never has, never will. Would you accept the same pay especially if it had to be lowered to insure the receptionist earns similar to you? What about the cafeteria worker? Yes I am going there. Why not. If we are going to declare a CEO makes to much then we cannot stop there after all we would be hypocritical. If anything the owners, be it shareholders or individuals, decide what is paid our and theoretically could take every dollar after what was decided as fair compensation was achieved

grugagag 6y ago
It is not a stupid idea when people work and are below the surviving threshold even if they have multiple jobs. Something's wrong but it's hard to see from your vantage point. And let me remind you that the lower one gets paid the harder and ass busting the work is.

anm89 6y ago

The irony of statements like this, is that by directing a huge amount of the energy created by a sense of the unfairness of how modern large corporations work to absolutely stupid proposed solutions like this which are so detached from the reality of how the modern economy works that they have 0 chance of ever being enacted at scale, you actually enable the corporations to get away with more because the people opposing them look like a bunch of morons who don't understand the system they are fighting.

volkk 6y ago
i see the point youre making, but i'm interested in hearing more about how the economy works, and which reforms are laudable vs which are moronic
- anchpop 6y ago
  The idea that everyone deserves a living wage from their employer has its heart in the right place but is wrong-headed. The reason is twofold: employers will attempt not to pay a living wage anyway, and it ignores the unemployed The better goal is to say that everyone deserves an income sufficient to make it possible to buy the things they need in life, even if they aren't employed. The best way to do this is with a robust welfare state, or a UBI. If you could survive just fine in perpetuity without a job, many people would choose to stay home and play videogames unless the jobs available to them made it truly worth their while.
- anm89 6y ago
  These ideas are problematic in so many different directions that without hearing which version of it is being proposed, it's a little hard to argue. I mean generally speaking, through which mechanism are you proposing telling people that they no longer have the right to make more money, even though people want to buy goods and services from them. Is it a hard cap? Some kind of ratio (which will surely be gamed to hell), is it case by case? Who sets the cap or ratio? Who is the minister of punishing rich people who decides that 5 billion isn't really a problem but 40 billion is just where to draw the line. Or is it because some guy bought a boat that was just a little too ostentatious (maybe he can send it back to the boat yard to have it trimmed up by 10 meters and evade the ruling). Do you see where this gets silly and is ripe for abuse? Let's say you miraculously manage to pull this off, then you'd have to wait the entire 10 minutes until Bezos Zuck and Buffett, shift half of their stock into a trust owned by family members that amazingly keeps them all just under the cap for long enough for them to do the same to redistribute to their heirs. Like, do you thing those guys are just going to call it quits because of this? They have all the money they need. Zuck probably doesn't wake up in the morning motivated by making another billion. He's playing a different meta-game. Also, it's very hard for me to imagine a version of the process for implementing this that does not look like some political theater McCarthy hearingesque which-hunt. Finally, whether you are reasonable or not, I know many people who would love to set these caps at absurd points. The coworking space I work at has the local chapter of Maoists who meet up every week on Wednesdays. I doubt you'd make it to six figures before they set their line. Do you really want this to be up to a vote?. Meanwhile amazon payed negative corporate taxes if I recall correctly a few years ago, and has cities fighting hand over fist to optionally hand tax payer money back to them in lump sums as bribes to get HQ2. We have all sorts of other regressive taxes. Our whole tax code is designed to benefit huge corporations who can hire millions of dollars worth of lawyers to find loopholes at the expense of being totally unmanageable to small business owners who cover the difference. So yes, our system has a lot of problems and a lot of them aren't as emotionally gratifying as complaining about some rich guys 3rd helicopter, but many of them, if people took the time to learn about them could actually meaningfully changed these situations going forward as opposed to punishing a handful of people who profited off of the current backwards system.

epistasis 6y ago

Brainstorming an idea here, but what about a modification to the corporate tax rate based on something like the Gini coefficient of the compensation inequality of the workers. Want to add an extra $10M of compensation for your CEO for adding a one-quarter 2% boost? Pay an extra 0.2% in your corporate tax rate, or similar? The other end of the spectrum is of course capital gains for shareholders, but any of the wealth taxes proposed recently would help make that more stable. We are at French Revolution levels of inequality, with a pandemic, a president that despises the majority of US citizens but runs clubs where power-seeking wealthy people pay for admission, and we are not even building enough housing for an entire generation that's growing up. If we don't start addressing this inequality in substantial ways, we will see much greater unrest.

dominotw 6y ago
> Gini coefficient of the whole country or that specific region ?
- epistasis 6y ago
  The coefficient of the specific employer's distribution of compensation, not the Gino coefficient of the entire population where they are located. It is a number that can be calculated for any distribution.
sukilot 6y ago
Trivially dodged by outsourcing.
- epistasis 6y ago
  Definitely can be gamed, as anything can be, but I wouldn't call it trivial. Companies are reluctant to outsource their core competencies.

lallysingh 6y ago

Can we do this analysis with a profitable company? The value of the business is currently negative.

jimbokun 6y ago

> Maybe instead of paying their CEO and executives that much, Uber should pay their workers more? So do we task Congress with figuring out the correct compensation for every worker in the US? Or do we just greatly increase taxes on those high earning executives and distribute to those most in need?

maerF0x0 6y ago

The main aspect missing from these sentiments is risk adjusted return. As another commenter said, if employees want the profits of shareholders they should also risk a total loss of their investment. Now, I do think more companies should pay with (generous) equity and the government should do far more to support this model. Such as supporting earlier liquidity, less accredited investor rules, mandatory public listings above a certain valuation etc.

eagsalazar2 6y ago

The bottom line is that the labor market for unskilled workers is not competitive, keeping rates low, to the extreme benefit of Bezos (in this case). Mandating higher wages will result in extreme distortions. I'm not saying we shouldn't do that, as fixing the underlying labor supply problem is messy as hell, I'm just saying culling executive pay is probably just very distorting and probably won't solve the problem anyway. Why would they just give those $$ to employees? It has never been about "we can't pay you because we don't have any money left after paying execs". They would just save more in the bank that they can use to abuse smaller competitors even more. The root issue is for Amazon and many other businesses, the cost of doing business is way too low.