Tag: worker benefits

Cartels and Concierge Bureaucracy Management

 

Several years ago I heard an amusing story on NPR’s Planet Money program. The story described an Indian entrepreneur who, frustrated with India’s local political corruption and red tape, started a new business: Concierge Bribery. For a fee, he would seek out and pay off all of the sundry local officials whenever a local business needed something done. I thought how lucky we were that America had not yet descended to that level. I was deeply wrong. We, in fact, have had concierge bureaucracy managers for some time.

While it is generally a good maxim to never ascribe to mendacity that which can be explained by incompetence, normal logic seems rarely to apply to any of the corruption and rot stemming from Obamacare (and for the record, I refuse to call it “The Affordable Care Act”, or ACA). The act seems explicitly designed, among other things, as a tool to force a cartelization of the entire medical industry. We see this in the rapid demise of independent practices, as they close up shop and merge into large provider networks — effectively regional medical cartels. What we are not yet seeing, or rather noticing, on any scale is the very similar effect Obamacare (when coupled with the many other business strictures in place) is having on general employment itself.

In Praise of the Sharing, Peer-to-Peer Economy

 

shutterstock_278653268Zipcar founder Robin Chase has an HBR piece, “Who Benefits from the Peer-to-Peer Economy,” where she discusses how workers are faring in the collaborative/peer-to-peer/on demand/sharing/gig economy, defining it as “marked by many platforms that engage a diversity of peers to contribute excess capacity which can be harnessed for greater impact … new platforms increasingly give the small the powers of marketing and distribution that were once reserved for the very large.” Same goes for manufacturing with 3-D printing, for instance, or MOOCs. But, she adds, policymakers must engage this new aspect of the US economy:

Governments need to recognize and prepare for this new third way of working which is neither full-time nor temporary part-time, but a new way of life. The Internet exists and everything that can become a platform will. Local and federal governments need to start tying benefits to people and not jobs, ensuring that labor is protected during this disruptive and swift transition. In a world struggling to cope with incessant disruption brought on by fast-paced technical innovation, climate change, urbanization, and globalization, Peers, Inc. is the structure for our times. It enables us to experiment, iterate, adapt, and evolve at the required pace. I’m happy this flexible new tool has come to exist. But while we are reaping the economic benefits brought on by individual contributions, we need to proactively share the productivity and innovation gains with individuals, too.

While I think the scope of the problem here has been exaggerated, Chase makes a good point, especially about tying benefits to people rather than jobs. Which is why mandating new benefits and employer costs is the wrong way to go. From my recent The Week column:

On Creating New Government Policies to Deal with the Sharing Economy

 

shutterstock_250766428Nick Hanauer and David Rolf outline a solution to what they (and Hillary Clinton, it seems) argue is a big, big problem right now: economic insecurity created by the growing sharing/on-demand/gig economy. Americans need a new social contract, one that brings more certainty and tangible benefits to all these part-timers and independent contractors. As they explain in Democracy Journal:

This is the new “you’re on your own,” benefit-free, race-to-the-bottom reality for millions of American workers. And as more new innovative businesses and business models are invented, this process will only accelerate. As the sharing economy kicks into high gear, more and more Americans will become independent contractors activated at the touch of a button on an app, working for a fleet of employers. … A robust set of mandatory universal benefits would put all employees and employers alike on an equal footing, while providing the economic security and certainty necessary for the middle class to thrive.

So what does this new social contract look like? It consists of two parts, what Hanauer and Rolf  have termed a “Shared Security Account” and “Shared Security Standards.”  here is how this system works: