May 8, 2019
By Jennifer Tiedemann

New York City has been notoriously unfriendly to the existence of ride-hail vehicles in recent months. Last August, it became the first U.S. city to issue a cap on the number of new ride-hail vehicle licenses issued. And then in December, it passed a minimum wage for ride-hail drivers, again making it the first U.S. city to do so.

Now, the New York City Taxi Workers Alliance, the union that represents New York City cab drivers and ride-hail drivers, has orchestrated a two-hour strike for ride-hail drivers. The work stoppage—which took place earlier this morning, ahead of Uber’s planned initial public offering later this week—occurred in concert with strikes taking place in more than a dozen cities around the world.

According to a press release issued by the Taxi Workers Alliance, the pursuit of higher pay for ride-hail drivers is what’s behind the strike. Among the ride-hail driver demands outlined in the release are “an end to the scam of upfront pricing” and a cap on ride-hail app companies’ commission, “guaranteeing 80-85% of the fare to the driver.”

It’s easy to see what the impact on consumers could be if these demands are met. Guaranteeing a bigger cut to drivers would likely translate into cost-per-ride increases passed on to riders. And an end to upfront pricing would mean an end to the transparency that consumers value in ride-hail apps (how many times have you chosen to delay or forgo a ride when you saw how much it would cost?).

And these demands wouldn’t just hurt consumers. One Taxi Workers Alliance member quoted in the Alliance’s press release says “The gig economy is all about exploiting workers by taking away our rights. It has to stop.” But the truth is the sharing economy gives workers the flexibility they want and need. A spokesperson for Lyft has said that more than 75 percent of its drivers “drive less than 10 hours a week to supplement their existing jobs.” And as Goldwater Institute Executive Vice President Christina Sandefur explained a few months back, workers in the sharing economy are increasingly female—and women tend to value job flexibility more than men do. No sharing economy would mean fewer options for workers, limiting their ability to earn extra income.

Truly protecting workers’ rights requires preserving opportunities to earn a living. And a successful business model requires keeping costs under control so consumers will use the service. The demands set forth by NYC’s ride-hail driver union ignore both of these truths. 

Jennifer Tiedemann is the Deputy Communications Director at the Goldwater Institute.

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