Sharing is the new welfare?

In the last few months I’ve rented rooms through Airbnb, listened to music on Spotify, picked up a free yellow bike in Milan, got a lift from Milan to Florence with Blablacar, grabbed a city car for a quick ride with Car2Go, hailed a cab on a rainy night with Uber, and funded a documentary with an online crowd funding platform. I have quite a few friends who rent office space using a co-working website, though I’ve never actually needed to do so myself. A year ago, none of these opportunities I now consider almost routine were nearly as common. They are all different facets of what is called the “Sharing Economy”, or, less frequently, ‘collaborative economy’, or ‘collaborative consumer economy’ .

 

They have one factor in common: the sharing of private resources (my car, my desk, my music, my home, my bike), which has always taken place informally. The novelty lies in the sheer scale of the sharing. Social networking platforms have made sharing a way of life not only among friends or neighbors, but also among complete strangers all over the world.

 

Is the process Jeremy Rifkind called “from ownership to access” really taking place? An article published by Wired framed the question thus: Apple and Amazon have a Problem: People don’t want to Buy Stuff Anymore. Apple has declared that sales of digital downloads have plummeted 14% since the beginning of 2014, whereas the highly popular music streaming site Spottify had already increased its turnover by 43% by 2013, closing the year with a profit for the first time since it was founded. Analysts estimate that 37 million users globally subscribe to music streaming sites.

 

There is a cultural shift taking place, attributed by the media and researchers to the new generation of millennials and an increase in freelance work. In the United States, one third of the workforce is either freelance or employed with short-term contracts. By 2025, when 75% of the workforce will be made up of millennials, freelance occupations will be the majority. According to an investigation by the Freelancers Union (representing approximately 250,000 American freelance workers), 90% of their card-holders would not consider a 9-5 office job. Sara Horowitz, writing for the Los Angeles Times, claimed in her article, ‘America, Say Goodbye to the Era of Big Work’ that millennials tend to value experience over possessions.

 

Claire Fontaine, Lucie Fontaine at The Green Gallery

Claire Fontaine, Lucie Fontaine at The Green Gallery

 

The freelance label is ambiguous, however. It does not distinguish between low-wage, menial labor and high end, creative workers. Both kinds of freelancers are on short-term, project-oriented contracts, but workers paid a pittance by the hour do not choose to be freelance, while creatives generally do. The term ‘freelance’ implies things are going well. Otherwise you would call it by a different name, such as temporary work. Sociologically speaking, it is a mistake to put the two categories together, and call them call the ‘creative class’ as Richard Florida does. From a quantitative point of view, however, it might be useful to consider them as an aggregate in order to analyze a new workforce which is no longer subject to traditional models of production.

 

The narrative regarding the unburdened, nomadic lifestyle of the new generation of worker/consumers places great emphasis on the fact that these qualities, together with a rejection of private property and of a job for life, are seen in a positive light.  Prerna Gupta, a successful start-upper and “angelinvestor” wrote an article for Techcrunch with an attention-grabbing title: “Airbnb Lifestyle: The Rise of the Hipster Nomad”. She describes how she and her husband decided to live for a whole year renting rooms on airbnb around the world with no possessions over and above their suitcases. Prerna Gupta belongs to the privileged international elite with Ivy League degrees and the ability to work wherever there is an Internet connection. Elites in the past used excessive consumerism as a way to underline their social status. Now, the new elites delight in excessive experience (taking part in the Burning Man is a status symbol among elite techies in California).

 

Prerna Gupta gives five reasons why sharing is better than having:

  1. 1. Ownership is a pain. I honestly can’t imagine ever wanting to own a house. Because I can’t stand the thought of having to deal with all the crap that comes with owning such a large and expensive thing. Renting is so much more convenient, and the fact is, I’m willing to pay for that convenience.
  2. 2. FOMO. Likewise, everyone knows Gen Y is allergic to commitment. I find the idea of committing to a specific place to live for years at a time depressing.
  3. 3. Freelancers are kings. Freelancing is becoming a way of life, too. I’ve been hearing from a lot of highly talented engineers, designers and product managers recently who are going freelance by choice. Work is becoming much more fluid, and workers have increasing control over when and where they work. This makes them less tied down.
  4. 4. The royal we. Families are getting smaller. Many of us may never have kids or get married at all. As family sizes shrink, there’s less incentive to settle down.
  5. 5. Democratization of style. There is a convergence happening in aesthetic style. We all basically like the same things, at approximately the same time. But, what we like changes relatively quickly, according to the latest hipster fashions. Ergo, borrowing is better for us than owning.

 

To all intents and purposes these new freelancers are like the hippies who followed Maureen and Tony Wheeler, the founders of the Lonely Planet. They are a techno-hipster development of the nomadic ideal espoused in the 1970s. Both reject private property and embrace experience, but the new generation would never do away with their credit cards. How else could they gain access to the experiences and services their nomadic lifestyle requires?

 

 

Claire Fontaine, Change, 2006. Courtesy of Galerie Neu

Claire Fontaine, Change, 2006. Courtesy of Galerie Neu

 

Just a minute. Honest self-reflection leads me to think I am not that different from Prerna Gupta (really?). I still own  car, but I hardly ever use it. I no longer have a bike (it was stolen from my yard), and I use the free bikes laid on by the mayor. Since I left home to go to college I have lived in four different cities and in 18 different rented apartments. This is probably because my work has always oscillated between the two freelance spectrums: I have been either a temporary worker or a knowledge worker according to the level of control I have been able to exert over what I produce and my contractual power. The material conditions of production determine  social class, as that long-bearded person once said.

 

The material condition of contemporary life has led to an exponential growth in collaborative consumer practices and to the affirmation of lifestyles that are not based on property. The Sharing Economy has, like self-installing software,  embedded itself automatically in the social Operating System where short term contracts are the norm for new workers. Freelancers and temporary workers welcome the Sharing Economy as a form of social welfare that western nations in the liberal mold no longer guarantee. In 2012, Forbes published a report commissioned by Airbnb revealing that 20% of those renting accommodation from the website in San Francisco were freelancers, 12% part-time workers, and 7% unemployed. San Francisco home owners placing their rooms for rent on the site stated that they did so either to increase the family budget (42%) or to help pay rent or make mortgage payments (56%). The spike in rental prices in cities is obviously a contributing factor.

 

What is left of the twentieth century welfare state only applies to salaried workers with lifetime jobs. Those excluded from state guarantees exploit the opportunities the Sharing Economy offers. Just as industrial workers in the nineteenth century created their own forms of mutual aid (later incorporated into the welfare state), today’s freelancers and temporary workers in the digital economy are organizing themselves in new collaborative ways, as entrepreneurs of themselves, in order to combat the uncertainties of the future, as Roberto Ciccarelli also write in an Italian web magazine Lavoro Culturale. Workers, as written in an article from ‘New York Times’, Find both freedom and uncertainty in these new forms of collaboration. The rhetoric of the Sharing Economy promises to match people seeking services with those offering them by means of their apps or websites. Anyone can independently offer their skills, time or property, but there will always be uncertainty on the horizon.

 

ClaireFontaine, No Present. Tessaloniki Biennale Of Contemporary Art 2013

ClaireFontaine, No Present. Tessaloniki Biennale Of Contemporary Art 2013

 

All that glitters is not Sharing

 

Having explore the constructive advantages of the Sharing Economy, I will now focus on the negatives. It is undeniable that the Sharing Economy provides cheaper, more efficient, more user-friendly and more rational services for consumers. The social cost, however, is not usually calculated in the equation. Improvement in consumer services goes hand in hand with a deterioration in working conditions. The efficiency paradigm, the collective rating of services, independent lone traders so typical of the Sharing Economy, are all part of the narrative of the self made man. In the neoliberal myth, entrepreneurs are free to set up a business doing whatever they want to do. But they are also totally responsible for their own failure and enjoy no form of safety net or social protection. The Sharing Economy for travelers using Uber or Airbnb is paradise, but it is hell for those who are forced for whatever reason to rent out their services, skills or property with no rights and no guarantees. It is the ultimate neoliberal dream: all company risks are externalized and compensation is not in the picture.

 

sharing economy graph

 

Kneese, Rosenblat and Boyd, in their article ‘Understanding Fair Labor Practices in a Networked Age’ report that Uber drivers in Los Angeles have to tell their passengers they adore their work, or they would get bad ratings. One driver allegedly said, “We sit and smile, and we tell everyone how great the work is because that’s what they want to hear”. In point of fact, Uber drivers are extremely upset about their working conditions. Another driver said that Uber exploits them, and treats them like ‘losers’ who would never find other work, ‘robots’ that could be ‘replaced’. An article published on The Verge (May 2014) claims Uber is actually thinking of replacing them.

 

On October 22, 2014, the first ever strike in the Sharing Economy took place. In various cities across the US and in London, a small group of Uber drivers took to the streets and turned off their apps in protest against low wages. Slogans such as “Fifteen hours a day for no money” were bandied about. Uber drivers are unhappy, taxi drivers are unhappy, hotel owners are unhappy. We have little sympathy for taxi drivers and hoteliers, whom we associate with the bad service and outrageous prices typical in monopoly markets. Yet, the kind of total deregulation represented by services such as Uber and Airbnb is risky.

 

The greatest mistake we are all making is to consider these services part of the Sharing Economy. Many services that appear to be shared are actually Rental Economies. That is, goods and services are rented through technological platforms that are commercial enterprises and have an owner, as Giorgos Kallis points out. Airbnb is a company that was founded in 2008. It is worth more than the Hyatt Hotel Group, rents out more rooms than the Intercontinental chain which, unlike Airbnb, has 120,000 employees in more than 100 countries. Airbnb has put up 8.5 million people without laying one brick. The only thing the company created was an app. It is a logistics company, and should not be considered part of the Sharing Economy.

 

Rents in downtown Barcelona are spiking. Owners make more money renting out with Airbnb for a few days than renting out property long term more cheaply. The result, Kallis claims, is the commercialization of whatever part of social life was not already taken over by economic considerations. The highly profitable economics of companies such as Airbnb, Kallis points out, has nothing to do with real collaborative economies such as collective city gardens, time banks, or couch surfing where users actually share their resources in order to help one another and where there is no financial intermediation and no profit. The Rental Economy is the inevitable commercialization of the Shared Economy. “Renting is not sharing,” rentals should be regulated and taxed Kallis concludes.

 

Claire Fontaine, Instructions For the Sharing of Private Property 2006

Claire Fontaine, Instructions For the Sharing of Private Property, 2006. Courtesy of the artists and the Museum of Contemporary Art, North Miami

 

Trebor Scholz, editor of Digital Labor: the Internet as Playground and Factory (New York: Routledge, 2012) and of the series of meeting devoted to Digital Labor, makes the distinction between the different approaches, as he wrote on his blog:

 

There is a difference between non-market practices and greed-free business like Craigslist and Fairnopoly on the one hand and corporations like Airbnb or Uber that profit from peer-to-peer interactions. Again, I support peer production and sharing practices but I am vexed by attempts to subsume them into the new corporate hype of “the sharing revolution,” that comes with calls to make the world a better place and comparisons to the "Arab Spring" and Occupy Wall Street. To summate, what seems to be completely missing from the discussion about the “sharing economy,” is a distinction between the shifts of markets (and labor practices) to the Internet and the surprising victories of market incumbents like Airbnb, Lyft, and Uber on the one hand, and commons-oriented peer production and greed-free companies on the other.

 

All practices end up in the same celebratory sauce of the Californian Ideology, complete with mandatory meditation, cheers, and group hugs followed by business pitches. Close your eyes and wake up in San Francisco-- 1995; then turn on an episode of HBO's Silicon Valley (spiritual advisor to business tycoon: “You clearly have a great understanding of humanity.’)

 

I am not sympathetic when practices and projects like Shareable and Wikipedia or – more generally- collaborative lifestyles with people exchanging resources such as food, skills, or time, are mixed up with often exploitative practices like crowdsourcing or massively commercial online learning platforms that can be linked to the closure of Community Colleges.

 

Michel Bauwens, founder of the P2P foundation, is a great supporter of new collaborative economies. He separates the two forms of sharing very clearly. One the one hand there are the extractive and exploitative sharers, he calls “netarchicapitalists”, and on the other cooperative sharers. Bauwens calls no profit organizations with a form of centralized control “local resilience”. In this scenario, local groups use peer to peer platforms to create community currencies, exchange platforms for local food produce, and so on. P2P technology is used as an aid to local communities. The scenario Bauwens prefers, however, is where P2P is used for the global common good. Global communities develop open projects such as Wikispped, Linux and Wikipedia. The global governance, in the New School researcher’s view, is “more democratic, post-capitalist, and post-state.”

 

Bauwens does not believe for-profit firms should be displaced by non-profit organizations. He firmly believes in a world where states, markets, and collaborative economies co-exist. We are so taken with the efficiency of the new services offered by the Sharing Economy that we tend to lose sight of the differences among the companies offering the services. Some are collaborative by nature, because they generate profit for the collectivity (both consumers and workers). This would be a form of Fair Trade applied to the digital world. Others do not “share’ anything. This is the difference between an anarchic, capitalist system, where individuals are potentially free but structurally on their own, and a system that is cooperative and social, where individuals are agents within a social network of solidarity and are less free but safer.

 

Perhaps, rather than falling for the latest ‘disruptive’ technology in the name of an understandable appreciation for better services, we should start thinking about the sustainability of the new economy based on digital networks. An anarchic, capitalist system, with automatized production and everyone is at war with everyone else in order to gain access to a living wage is clearly unsustainable. Perhaps we should go back to Pëtr Alekseevič Kropotkin and his powerful book Mutual Aid. Perhaps we should re-learn from our past to sustain one another, share our resources when there is not enough to go round and organize society so that rights are extended to everybody, with no distinctions. Governments can no longer get away with giving bonuses to the middle class. They will have to start contemplating some form of universal income, or direct support for efficient and sustainable digital non-profit companies.



  • Claire Fontain, Consumption, 2010. Helena Papadopoulos, Athens
    Claire Fontain, Consumption, 2010. Helena Papadopoulos, Athens
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