If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:
"Minimum wage" is one of those odd concepts that seems to have an intuitive definition, but the harder you think about it, the more complicated it gets. For example, if you want to work, but can't find a job, then the minimum wage you'll get is zero:
That's why politicians like Avi Lewis (who is running for leader of Canada's New Democratic Party) has call for a jobs guarantee: a government guarantee of a good job at a socially inclusive wage for everyone who wants one:
(Disclosure: I have advised the Lewis campaign on technical issues and I have endorsed his candidacy.)
If that sounds Utopian or Communist to you (or both), consider this: it was the American jobs guarantee that delivered the America's system of national parks, among many other achievements:
The idea of a wage for everyone who wants a job is just one interesting question raised by the concept of a "minimum wage." Even when we're talking about people who have wages, the idea of a "minimum wage" is anything but straightforward.
Take gig workers: the rise of Uber and its successors created an ever-expanding class of workers who are misclassified as independent contractors by employers, seeking to evade unionization, benefits and liability. It's a weird kind of "independent contractor" who gets punished for saying no to lowball offers, has to decorate their personal clothes and/or cars in their "client's" livery, and who has every movement scripted by an app controlled by their "client":
The pretext that a worker is actually a standalone small business confers another great advantage on their employers: it's a great boon to any boss who wants to steal their worker's wages. I'm not talking about stealing tips here (though gig-work platforms do steal tips, like crazy):
I'm talking about how gig-work platforms define their workers' wages in the first place. This is a very salient definition in public policy debates. Gig platforms facing regulation or investigation routinely claim that their workers are paid sky-high wages. During the debate over California's Prop 22 (in which Uber and Lyft spent more than $225m to formalize worker misclassification), gig companies agreed to all kinds of reasonable-sounding wage guarantees:
When Toronto was grappling with the brutal effect that gig-work taxis have on the city's world-beatingly bad traffic, Uber promised to pay its drivers "120% of the minimum wage," which would come out to $21.12 per hour. However, the real wage Uber was proposing to pay its drivers came out to about $2.50 per hour:
How to explain the difference? Well, Uber – and its gig-work competitors – only pay drivers while they have a passenger – or an item – in the car. Drivers are not paid for the time they spend waiting for a job or the time they spend getting to the job. This is the majority of time that a gig driver spends working for the platform, and by excluding the majority of time a driver is on the clock, the company can claim to pay a generous wage while actually paying peanuts.
Now, at this phase, you may be thinking that this is only fair, or at least traditional. Livery cab drivers don't get paid unless they have a fare in the cab, right?
That's true, but livery cab drivers have lots of ways to influence that number. They can shrewdly choose a good spot to cruise. They can give their cellphone numbers to riders they've established a rapport with in order to win advance bookings. In small towns with just a few drivers – or in cities where drivers are in a co-op – they can spend some of their earnings to advertise the taxi company. Livery drivers can offer discounts to riders going a long way. It's a tough job, but it's one in which workers have some agency.
Contrast that with driving for Uber: Uber decides which drivers get to even see a job. Uber decides how to market its services. Uber gets to set fares, on a per-passenger basis, meaning that it might choose to scare some passengers off of a few of their rides with high prices, in a bid to psychologically nudge that passenger into accepting higher fares overall.
At the same time, Uber is reliant on a minimum pool of drivers cruising the streets, on the clock but off the payroll. If riders had to wait 45 minutes to get an Uber, they'd make other arrangements. If it happened too often, they'd delete the app. So Uber can't survive without those cruising, unpaid drivers, who provide the capacity that make the company commercially viable.
What's more, livery cab drivers aren't the only comparators for gig-work platforms. Many gig workers deliver food, meaning that we should compare them to, say, pizza delivery drivers. These drivers aren't just paid when they have a pizza in the car and they're driving to a customer's home. They're paid from the moment they clock onto their shift to the moment they clock off (plus tips).
Now, obviously, this is more expensive for employers, but the Uber Eats arrangement – in which drivers are only paid when they've got a pizza in the car and they're en route to a customer – doesn't eliminate that expense. When a gig delivery company takes away the pay that drivers used to get while waiting for a pizza, they're shifting this expense from employers to workers:
The fact that Uber can manipulate the concept of a minimum wage in order to claim to pay $21.12/hour to drivers who are making $2.50 per hour creates all kinds of policy distortions.
Take Seattle: in 2024, the city implemented a program called "PayUp" that sets a "minimum wage" for drivers, but it's not a real minimum wage. It's a minimum payment for every ride or delivery.
A new National Bureau of Economic Research paper analyzes the program and concludes that it hasn't increased drivers' pay at all:
https://www.nber.org/papers/w34545
To which we might say, "Duh." Cranking up the sum paid for a small fraction of the work you do for a company will have very little impact on the overall wage you receive from the company.
However, there is an interesting wrinkle in this paper's conclusions. Drivers aren't earning less under this system, either. So they're getting paid more for every delivery, but they're not adding more deliveries to their day. In other words, they're doing less work and then clocking off:
A neoclassical economist (someone who has experienced a specific form of neurological injury that makes you incapable of perceiving or reasoning about power) would say that this means that the drivers only desire to earn the sums they were earning before the "minimum wage" and so the program hasn't made a difference to their lives.
But anyone else can look at this situation and understand that drivers only did this shitty job out of desperation. They had a sum they needed to get every month in order to pay the rent or the grocery bill. They have lots of needs besides those that they would like to fulfill, but not under the shitty gig-work app conditions. The only reason they tolerate a shitty app as their shitty boss at all is that they are desperate, and that desperation gives gig companies power over their workers.
In other words, Seattle's PayUp "minimum wage" has shifted some of the expense associated with operating a gig platform from workers back onto their bosses. With fewer drivers available on the app, waiting times for customers will necessarily go up. Some of those customers will take the bus, or get a livery cab, or defrost a pizza, or walk to the corner cafe. For the gig platforms to win those customers back, they will have to reduce waiting times, and the most reliable way to do that is to increase the wages paid to their workers.
So PayUp isn't a wash – it has changed the distributional outcome of the gig-work economy in Seattle. Drivers have clawed back a surplus – time they can spend doing more productive or pleasant things than cruising and waiting for a booking – from their bosses, who now must face lower profits, either from a loss of business from impatient customers, or from a higher wage they must pay to get those wait-times down again.
But if you want to really move the needle on gig workers' wages, the answer is simple: pay workers for all the hours they put in for their bosses, not just the ones where bosses decide they deserve to get paid for.
A new study shows an increase in excess mortality that is statistically significant in the immediate weeks following government imposed lockdowns.
A new study from the National Bureau of Economic Research has put yet another nail in the already closed coffin of the pro-lockdown narrative and has received zero corporate media attention. Surprised?
Why do so many people think Republicans are great at managing the economy?
It’s certainly true that the GOP is great for the economy of the filthy rich, that’s why they use their massive wealth to keep Republicans in power. But contrary to supply side economic theory (AKA: “voodoo economics”) most of those tax breaks for billionaires don’t trickle down to the rest of us.
The National Bureau of Economic Research (NBER) is the authority which determines the beginnings, ends, and lengths of recessions and depressions.
This crop from their page showing all the US economic cycles since the 1850s indicates that 9 of the 11 recessions which began since the end of World War II started under Republican presidents. For clarity, I added the blue stars for Democratic presidents and red stars for Republican presidents.
Just to be clear: “Contractions (recessions) start at the peak of a business cycle and end at the trough.” In other words, a recession starts when business stops peaking and starts to go into decline; a recession ends when the decline is over and business starts to rebound from its trough. Two consecutive quarters of negative GDP growth are required before the NBER declares a recession.
If you want the Obama recovery to continue, dump Trump ASAP.
The surveillance advertising to financial fraud pipeline
Monday (October 2), I'll be in Boise to host an event with VE Schwab. On October 7–8, I'm in Milan to keynote Wired Nextfest.
Being watched sucks. Of all the parenting mistakes I've made, none haunt me more than the times my daughter caught me watching her while she was learning to do something, discovered she was being observed in a vulnerable moment, and abandoned her attempt:
It's hard to be your authentic self while you're under surveillance. For that reason alone, the rise and rise of the surveillance industry – an unholy public-private partnership between cops, spooks, and ad-tech scum – is a plague on humanity and a scourge on the Earth:
But beyond the psychic damage surveillance metes out, there are immediate, concrete ways in which surveillance brings us to harm. Ad-tech follows us into abortion clinics and then sells the info to the cops back home in the forced birth states run by Handmaid's Tale LARPers:
And even if you have the good fortune to live in a state whose motto isn't "There's no 'I" in uter-US," ad-tech also lets anti-abortion propagandists trick you into visiting fake "clinics" who defraud you into giving birth by running out the clock on terminating your pregnancy:
The commercial surveillance industry fuels SWATting, where sociopaths who don't like your internet opinions or are steamed because you beat them at Call of Duty trick the cops into thinking that there's an "active shooter" at your house, provoking the kind of American policing autoimmune reaction that can get you killed:
There's just a lot of ways that compiling deep, nonconsensual, population-scale surveillance dossiers can bring safety and financial harm to the unwilling subjects of our experiment in digital spying. The wave of "business email compromises" (the infosec term for impersonating your boss to you and tricking you into cleaning out the company bank accounts)? They start with spear phishing, a phishing attack that uses personal information – bought from commercial sources or ganked from leaks – to craft a virtual Big Store con:
It's not just spear-phishers. There are plenty of financial predators who run petty grifts – stock swindles, identity theft, and other petty cons. These scams depend on commercial surveillance, both to target victims (e.g. buying Facebook ads targeting people struggling with medical debt and worried about losing their homes) and to run the con itself (by getting the information needed to pull of a successful identity theft).
In "Consumer Surveillance and Financial Fraud," a new National Bureau of Academic Research paper, a trio of business-school profs – Bo Bian (UBC), Michaela Pagel (WUSTL) and Huan Tang (Wharton) quantify the commercial surveillance industry's relationship to finance crimes:
https://www.nber.org/papers/w31692
The authors take advantage of a time-series of ZIP-code-accurate fraud complaint data from the Consumer Finance Protection Board, supplemented by complaints from the FTC, along with Apple's rollout of App Tracking Transparency, a change to app-based tracking on Apple mobile devices that turned of third-party commercial surveillance unless users explicitly opted into being spied on. More than 96% of Apple users blocked spying:
In other words, they were able to see, neighborhood by neighborhood, what happened to financial fraud when users were able to block commercial surveillance.
What happened is, fraud plunged. Deprived of the raw material for committing fraud, criminals were substantially hampered in their ability to steal from internet users.
While this is something that security professionals have understood for years, this study puts some empirical spine into the large corpus of qualitative accounts of the surveillance-to-fraud pipeline.
As the authors note in their conclusion, this analysis is timely. Google has just rolled out a new surveillance system, the deceptively named "Privacy Sandbox," that every Chrome user is being opted in to unless they find and untick three separate preference tickboxes. You should find and untick these boxes:
Google has spun, lied and bullied Privacy Sandbox into existence; whenever this program draws enough fire, they rename it (it used to be called FLoC). But as the Apple example showed, no one wants to be spied on – that's why Google makes you find and untick three boxes to opt out of this new form of surveillance.
There is no consensual basis for mass commercial surveillance. The story that "people don't mind ads so long as they're relevant" is a lie. But even if it was true, it wouldn't be enough, because beyond the harms to being our authentic selves that come from the knowledge that we're being observed, surveillance data is a crucial ingredient for all kinds of crime, harassment, and deception.
We can't rely on companies to spy on us responsibly. Apple may have blocked third-party app spying, but they effect nonconsensual, continuous surveillance of every Apple mobile device user, and lie about it:
Contrary to the claims of surveillance profiteers, this wouldn't reduce the income to ad-supported news and other media – it would increase their revenues, by letting them place ads without relying on the surveillance troves assembled by the Google/Meta ad-tech duopoly, who take the majority of ad-revenue:
We're 30 years into the commercial surveillance pandemic and Congress still hasn't passed a federal privacy law with a private right of action. But other agencies aren't waiting for Congress. The FTC and DoJ Antitrust Divsision have proposed new merger guidelines that allow regulators to consider privacy harms when companies merge:
Think here of how Google devoured Fitbit and claimed massive troves of extremely personal data, much of which was collected because employers required workers to wear biometric trackers to get the best deal on health care:
Companies can't be trusted to collect, retain or use our personal data wisely. The right "balance" here is to simply ban that collection, without an explicit opt-in. The way this should work is that companies can't collect private data unless users hunt down and untick three "don't spy on me" boxes. After all, that's the standard that Google has set.
If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:
