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Pete Buttigieg has emerged as a Silicon Valley darling in the 2020 presidential field. But heading into this week's Democratic debates, the mayor of South Bend, Ind., is taking aim at the industry’s labor practices.
Buttigieg took aim at Uber and Lyft in a new economic proposal that seeks to limit companies’ increasingly common practice of classifying workers as independent contractors. Buttigieg argued that ride-hailing companies’ classification of drivers as independent contractors is limiting those workers’ basic protections such as minimum wage and overtime pay.
Uber and Lyft would likely view Buttigieg’s economic proposal as “an existential threat” to their entire business models, said Alex Rosenblat, a researcher at the Data and Society Research Institute.
“To me it suggests it’s going to be a presidential issue,” said Rosenblat, the author of “Uberland: How Algorithms Are Rewriting the Rules of Work.” “It raises the issue to a national debate.”
And it’s not just gig economy companies that Buttigieg put on notice — he also called out Google for classifying many software developers, food service workers and other workers vital to its businesses as contractors. The practice is common at many technology companies.
Buttigieg’s criticism of the tech industry’s labor practices came right after he was in the Bay Area fundraising from notable techies, including at an event hosted by Netflix chief executive Reed Hastings.
This highlights a larger trend on the 2020 campaign trail: Democratic candidates are blasting the corporate greed and largesse of the tech industry, while still cashing checks from Silicon Valley to fuel their campaigns in a competitive field.
By challenging Silicon Valley's reliance on contract workers, Buttigieg also could be trying to show he's not in big tech's pocket despite his support from venture capitalists and tech executives. Buttigieg raised more money from large-dollar donors in California between April and June than any other candidate, including home-state Sen. Kamala D. Harris (D-Calif.), according to analysis by The Mercury News, boosted by large donors in Silicon Valley and Hollywood.
It could be key for Buttigieg to appear independent heading into a second round of debates during a campaign season where the concentration of corporate power has been a key issue.
Rosenblat said Buttigieg’s decision to frame his proposal around gig economy companies reflects a broader “techlash.” He's targeting Uber and Lyft after drivers around the country protested unfair wages and other working conditions at the companies as employees celebrated the companies' initial public offerings — a display of the inequalities that persist between contractors and workers.
“It’s low-hanging fruit in some ways that has potential to gain popular support,” she said.
And even one venture capitalist focused on the future of work praised Buttigieg for taking the time to learn about issues related to the gig economy and the tech industry. Roy Bahat, the head of Bloomberg Beta, praised Buttigieg for taking the time to get to know Silicon Valley venture capitalists when they did a tour of the Midwest last year called “The Comeback Cities Tour."
"[Buttigieg] is addressing the issues that are live issues right now,” Bahat said. “One of the things we need is better mutual understanding between tech industry and rest of America so we’re not foreigners to each other.”
Buttigieg has not been as aggressive as some of his Democratic peers in attacking the size and power of the technology industry. Others such as Sen. Elizabeth Warren (D-Mass.) have said that big technology firms like Facebook, Google and Amazon need to be broken up. Buttigieg has so far only raised concerns about the consolidation of corporate power and said that the Federal Trade Commission should be empowered so it can better address monopolies.
“Antitrust law as we know it has begun to hit its limits with regulating tech companies,” Buttigieg said at an event in April, according to The Verge. “It’s not designed to handle some of these tech companies where there’s actually no price at all. The product is made free, or at least it’s free on its face. We’ve learned in part because of the way our data are used by these companies that nothing is actually free.”
Buttigieg's plan would overhaul existing labor laws so that employers would have to demonstrate that workers are free from employer's control or customarily work as an independent business in the industry to classify employees as independent contractors.
Lyft did not respond to a request for comment. Uber said in a statement that the company hears drivers value the flexibility the companies' contracting positions offer.
“We believe that independent, on-demand workers should not have to sacrifice security to enjoy that flexibility,” Uber said in a statement. “That’s why we’ve been at the table with stakeholders offering a plan that would guarantee drivers an earnings floor tied to minimum wage plus expenses; a robust package of portable benefits they can access no matter which ride-share company they drive for; and meaningful representation that gives them a say on matters affecting their lives and livelihood.”
Clarification:This article has been updated to clarify Alex Rosenblat's remarks on the business models of ride sharing companies.
BITS: Sen. Josh Hawley (R-Mo.) wants to ban autoplaying YouTube videos, never-ending Instagram feeds and “Snapstreaks.” Hawley released a bill today that aims to cut down on social media addiction by banning companies from deploying “deceptive techniques that tech companies use to exploit users,” according to a news release from his office.
The Social Media Addiction Reduction Technology Act would require social media companies to have natural stopping points, and ban the companies from deploying features like infinite scroll or other “achievements” like Snapstreaks that keep users returning to an app. The bill would also give the Federal Trade Commission and the Department of Health and Human Services authority to ban other similar practices. Companies would also be required to provide an in-app tool that allows users to track the amount of time they spend on a social media service across all devices and impose caps on those times.
“Big tech has embraced a business model of addiction,” Hawley said. “Too much of the ‘innovation’ in this space is designed not to create better products, but to capture more attention by using psychological tricks that make it difficult to look away. This legislation will put an end to that and encourage true innovation by tech companies.”
The Campaign for Commercial-Free Childhood, which has been calling for greater accountability for the tech companies' treatment of kids, praised the legislation. “Social media companies deploy a host of tactics designed to manipulate users in ways that undermines their well-being,” Josh Golin, executive director of Campaign for a Commercial-Free Childhood said. “We commend Senator Hawley for introducing legislation that would prohibit some of the most exploitative tactics, including those frequently deployed on children and teens.” Facebook, Google and Snap did not immediately respond to requests for comment.
NIBBLES: Nigerian scammers are using Facebook as a “one-stop shop” to impersonate members of the U.S. military and con vulnerable Americans into sending them money, gifts, and their hearts, Jack Nicas at the New York Times reports. The social media giant and U.S. military have struggled to curb the uptick of “love hoaxes,” leading to devastating consequences for victims of the global fraud.
One impersonator, using the name Michael Chris, conned a Delaware woman out of tens of thousands of dollars over two years. The real-life Marine Corps sergeant impersonated by Chris has discovered hundreds of fake profiles using his likeness.
Facebook relies on software to detect scam-like behavior and user reports to remove billions of scam accounts each year, it tells the Times. It also recently added facial recognition technology “that can automatically spot impostors of some of the most commonly impersonated service members.” But tests run by the Times showed the software doesn’t always work and reports are often ignored. Facebook and Instagram left up dozens of accounts flagged by the paper — including those of high-ranking military officials.
The volume of spam accounts on Facebook and difficulty prosecuting love scams makes the problem difficult for the military to tackle. “You contact a social media platform; you ask them to take it down; they do. Within 15 minutes, more pop up,” Chris Grey, a spokesman for the Army’s Criminal Investigation Command, told the Times.
BYTES: The European Union's top court ruled yesterday that sites with Facebook “Like” buttons could be held liable for violating European privacy laws — even if it’s Facebook that ultimately collects the data. The new ruling could crack down on Facebook’s ability to track users across a number of websites in countries protected by European privacy law.
In the case in question, the court decided that a German fashion site commercially benefited from automatically sharing user data through a “like” button because it allowed the site to “optimize its goods for publicity.” Consequently, it was responsible for notifying visitors that just loading its Web page transmitted their data to Facebook. Facebook has long used features such as its “like” button to track visitors across websites, regardless of whether they’re Facebook users.
“We are carefully reviewing the court’s decision and will work closely with our partners to ensure they can continue to benefit from our social plugins and other business tools in full compliance with the law,” Facebook associate general counsel Jack Gilbert told Tech Crunch. Facebook has not announced any changes to how its “like” buttons work, but may have to do so as a result of the ruling.
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