I agree with disrupting the medallion system but the cost of rides fell dramatically and by most accounts I can find if drivers actually did their taxes correctly, they would be making less than minimum wage[0]
Why keep driving if the wages are so low? Also, in the medallion days it wasn't uncommon for drivers to end up in the red after a bad day, when factoring the costs of renting the medallion in the first place.
Because drivers, generally speaking, are not well-informed of their costs. Generally speaking when considering their wages they don't count the costs of the maintenance and depreciation on their vehicles, because this is not something that a normal driver has to think about very hard, and they all used to be just normal drivers. But it's not very hard to hit 100k miles on a car when rideshare becomes your new profession.
> Because drivers, generally speaking, are not well-informed of their costs.
I dunno, going through some forum threads on UberPeople shows exact opposite - drivers meticulously track their take, expenses, etc. - there is even a cottage industry of tools giving them all sorts of data analytics in exchange for the ride data.
Anecdotally, I’ve seen one driver keep a spreadsheet of various gasoline brands and his mpg (my destination was near Costco and I casually suggested he use it to refuel, and got an earful on how Costco was in his top 5, but not the best options to refuel).
I'd assume active participants on an Uber driver's forum are going to be better informed than the average driver, but may not be representative. Maybe Uber relies on churning through less informed people to "fill the gaps" and provide service in less profitable (for drivers) locations or timeslots.
All I can think is that you saw "less informed" and read "idiot", but that's not what I wrote. Not everyone makes it a hobby to optimize their finances down to the last detail - in fact most people don't.
I'm probably leaving money on the table with my retirement savings - perhaps there are lower cost funds or tax-loss harvesting I could be doing if I spent hours each week reading personal finance blogs. That doesn't mean I'm an idiot, and it's the same with drivers who don't necessarily calculate wear and depreciation for every last mile.
So to save the “less informed” CA politicians passed a hideous, law written for the legislature by unions and ended up taking out a bunch of industries besides just Uber and Lyft.
My favorite group are all the liberal tech writers, the majority of which fell under AB5 and are now freaking out too.
Unintended consequences are often far more damaging than just letting markets sort things out.
And who says making less than minimum wage is always a bad thing? A lot of people drive for these services as supplemental income. It’s NOT their primary income, yet all your arguments are coming solely from that perspective.
I don't think most Uber/Lyft drivers look at this as a career; at least, none of the ones I've met do. It's a way of making a few bucks without a lot of commitment while they prepare to do something else.
You want to help these people out? Get rid of most occupational licensing.
The only reason the cost of rides fell dramatically is that Uber has been losing billions of dollars yearly[1]. Any other business would have folded and declared bankruptcy.
I agree with disrupting the medallion system but the cost of rides fell dramatically and by most accounts I can find if drivers actually did their taxes correctly, they would be making less than minimum wage[0]
[0]https://www.usatoday.com/story/news/nation-now/2018/03/02/ub...