On November 3, as Americans voted in record numbers to deny President Donald Trump a second term in office, Californians overwhelmingly approved Proposition 22, a ballot initiative that exempts app-based gig companies like Uber and Lyft from the obligation to classify rideshare and delivery drivers as employees. The impact of the measure, which in effect creates a new employment category—the contract gig worker—has already been profound. In January, Vons, Pavilions, and other subsidiaries of the grocery chain Albertsons announced plans to lay off and replace their full-time delivery staff with subcontractors from apps like DoorDash.
This development is, from one perspective, just the latest in a long line of defeats for the labor movement. But the Prop 22 episode is also an instructive tale about the tectonic shift undergone by American liberalism—and the Democratic Party—since the 1980s.
Executives and owners regard Prop 22 as an obvious win: By replacing their workforces with third-party contractors, they’ll see labor costs go down and profit margins go up. Workers, however, will find no silver lining. Full-time jobs will disappear, and fired employees who take jobs with DoorDash or a similar company will face much harsher working conditions, without overtime pay, sick leave, protections against workplace discrimination, the ability to form a union, or eligibility for state unemployment insurance. Thanks to various newly created loopholes and exemptions, researchers at UC Berkeley have estimated that some gig drivers will end up making as little as $5.64 an hour—roughly equivalent in value to the minimum wage during the presidency of Harry Truman when adjusted for inflation.
For these reasons, the labor-law professor Veena Dubal recently described Prop 22 as “the most radical undoing of labor legislation since Taft-Hartley in 1947”—the Truman-era bill that curbed the power of unions and laid the groundwork for the adoption of so-called right-to-work laws across many states. If tech companies ultimately succeed in their quest to export the California model nationwide, they may hasten an even more profound transformation of America’s labor market. As The American Prospect’s Alexander Sammon has pointed out, Prop 22’s almost immediate embrace by grocery chains is beginning to make companies like Uber, Lyft, and DoorDash look “more like traditional staffing agencies than innovative, high-tech products.” Tantalized by the possibility of lower labor costs, businesses of every kind may convert to an independent workforce when laws allow—potentially cementing the gig economy and its ethos of precarity-enabled consumer convenience as the norm everywhere.
The ballot measure’s backstory is arguably as noteworthy as its contents. Although anti-worker policies have a storied history in relation to Republican governors and conservative ideology, the milieu that gave birth to Prop 22 was as blue as San Francisco Bay. Five Big Tech companies bankrolled the $200 million “Yes on Prop. 22” campaign, but the idea has deep roots in the Democratic Party and in American liberalism as a whole.
Most obviously, its core concept (the need for a third category of worker alongside employees and independent contractors) comes from a 2015 policy paper co-authored by former Obama Acting Labor Secretary (and presidential-campaign adviser to Joe Biden) Seth Harris. Harris, who departed the Obama administration for a perch at the employer-side law firm Dentons, argued that the flexibility nominally associated with gig workers (particularly the fact that employers like Uber don’t technically fix their hours) sets them apart from traditional employees. Tony West, another Obama alum and a senior vice president at Uber, helped write the tech companies’ legal strategy, and also co-chaired Kamala Harris’s 2016 Senate transition team. (West is also the now vice president’s brother-in-law.)
Despite their ties to Silicon Valley, both Biden and Harris did officially come out against Prop 22—as did other prominent national Democrats (California’s Democratic governor, Gavin Newsom, revealingly, stayed silent). Not clear yet is how vocal they’ll be on the issue in office, although the prominence of personnel from the likes of Uber, Lyft, and Amazon during the recent presidential transition was certainly less than encouraging.
However these tensions ultimately play out in the new administration, the Prop 22 debate, which pitted gig companies against a badly outgunned alliance of unions and labor-advocacy groups, was also in a sense a battle between an older incarnation of liberalism and the form it’s taken since the 1990s. Although the Democratic Party has never been a straightforwardly labor-based or social-democratic formation in the mold of Britain’s mid-century Labour Party, its greatest lasting achievements (notably the New Deal) inarguably came, to quote the Princeton historian Matthew Karp, “because it was a party of workers.”
Under the leadership of key figures associated with the Democratic Leadership Council (most notably Bill Clinton), Democrats not only acceded to core tenets of Reaganism but reoriented their electoral base toward white-collar professionals and other, more affluent constituencies. Accordingly, the union halls and diverse working-class neighborhoods that had helped secure Democrats their congressional majorities since the 1930s gave way to Silicon Valley and Wall Street. The new liberalism became more market-focused than that of FDR’s New Deal, LBJ’s Great Society, or Jesse Jackson’s Rainbow Coalition.
The consequences of this shift on the overall political landscape, and on American society, have been profound. Although Republican politicians certainly bear considerable responsibility for the rising social inequality of the past several decades, it’s also no accident that the two spiritual heartlands of modern American liberalism—New York and California, where Democrats now enjoy huge legislative majorities—boast some of the worst income disparities in the country. Today, incentives for Big Business, attacks on unions, and deference to organized wealth have as much of a home in liberal bastions as they do in places such as Texas and Kentucky.
Biden’s recent victory suggests that Democrats are still sometimes able to assemble broad alliances of voters encompassing parts of America’s multiracial working class as well as affluent new-economy professionals and wealthy suburbanites. Party strategists, however, have continued to center the latter groups. And, as the Prop 22 episode illustrates, the values of those groups have come to influence liberal thinking and policy making at the highest level. Indeed, the further entrenchment of precarious gig-based work is a natural by-product of liberalism in its current form. As long as Democrats embrace both market individualism and well-off voters, they will inevitably place greater emphasis on the desire for convenience among white-collar workers than on the need for security among those toiling in the gig economy.
Though they may periodically succeed in capturing votes from working-class and affluent professionals alike, Democrats cannot simultaneously foreground the interests of well-off consumers or managers and the workers who now bring them lunch via smartphone app. As the history professors Matthew Lassiter and Lily Geismer recently put it, the “strategy of chasing college-educated professionals, and thereby prioritizing their policy interests,” ultimately “risks hamstringing progressive social movements, misdirecting scarce resources, and thwarting the potential for bold policy reform.”
With tech companies almost certain to mobilize their considerable resources in an effort to extend California’s new model to other states, and perhaps even enshrine it in federal law, the fight over Prop 22 was only the first of many similar bouts ahead. Coming as it did from inside the bosom of the modern Democratic Party itself, Prop 22 is therefore just the latest symptom of a liberalism suffering from a chronic case of affluenza—and a harbinger of the struggle that could come to define its future.