Driving Economic Justice: The Public Option

Taxi workers in the late 1960s and through the 1970s struggled against the transformation of their industry from regulated and unionized jobs to deregulated independent contracting work. This meant the loss of collective bargaining rights for taxi workers and a sharp rise in precarious working conditions as employers were able to shift business risk onto workers, cut expenses on benefits, and increase profits in-turn. In a spirited response, taxi workers self-organized and sustained union-like alt labor groups, for example the New York Taxi Workers Alliance in New York and United Taxicab Workers  in San Francisco, that fought for better working conditions for taxi workers through municipal and city regulations. My Institute for the Cooperative Digital Economy (ICDE) fellowship work with the Just Transitions Initiative at UCSD follows the case of one such taxi worker advocacy organization in San Diego called United Taxi Workers San Diego (UTWSD). Having successfully fought for regulatory reform for all taxi workers in the past and facing the realities of a shrinking taxi industry in San Diego, UTWSD, in its mission of pursuing taxi worker well being, has turned to a vision of promoting economic democracy through cooperative means.

United Taxi Workers San Diego: Mission and Struggle
United Taxi Workers San Diego (UTWSD) is an immigrant-led worker advocacy organization,  uniting taxi drivers across races and ethnic groups to achieve better working conditions. They formed after a historic strike for taxi workers in 2009, taking a stand against exploitation by cab company owners. They have overcome racism, exploitative regulations, and institutional exclusion through policy advocacy and direct action. Throughout these efforts, UTWSD has established a legion of allies among lawyers, labor organizers, researchers, volunteers, and political leaders.

Despite UTWSD’s significant efforts, taxi drivers have struggled to make a decent living. Drivers face high business startup costs, punitive backlash from cab company owners, and a shrinking market having to compete with venture capital backed rideshare apps (like Uber and Lyft). In recognition of drivers’ lived realities, UTWSD first attempted to assemble their own app-enabled taxi dispatch that would be democratically owned by taxi workers in 2015. However, UTWSD lacked the expertise and financial resources to continuously maintain the app and drivers lacked the startup capital necessary to build a cooperative. Further, even if UTWSD had somehow managed to overcome those challenges, they would have to go out and compete in a market dominated by rideshare companies with enormous venture capital aiming to take monopolistic control.

The platform co-op community understands the challenges of software maintenance and the additional labor, resources, policies, and market conditions necessary to build a sustainable worker-cooperative well. How do taxi workers in San Diego overcome these barriers? What are the necessary conditions for taxi workers to thrive? What can we learn from their ongoing struggle?

Vision: “The Public Option”
UTWSD started with a broad vision of a unionized and app-enabled taxi cooperative regulated in the public interest. They incorporated lessons learnt through past failure and identified public-sector support as necessary for the success of their vision. Recognizing the need for regulated on-demand transportation to patch transit infrastructure gaps in the San Diego region, UTWSD refined their vision to advance taxis as a preferred partner for public transit that could:

• Provide flexible first-last mile solutions to increase public transit ridership.
• Improve access for riders with disabilities.
• Promote the economic well-being of taxi workers.
• Rapidly transition to an electric fleet through government regulation and support.

Alongside other researchers at UC San Diego, I have been working with UTWSD on this vision for over three years. In shaping this vision our team drew on the history of healthcare reform unfolding in California in the early 2000s. Policymakers supported the creation of a public option in order to offer families and individuals a viable alternative to the for-profit health insurance providers. Inspired by these debates about the need for public competitors to private providers of essential services, we called our vision “the public option” for on-demand transportation amongst ourselves. Thus, the goal of “the public option” is not to compete with rideshare companies like Uber and Lyft directly. Rather it aims to offer a publicly regulated and supported alternative to rideshare companies for both drivers and passengers in San Diego.

Our progress on this vision has been slow but steady. We have completed several tasks and are making progress on others to ensure its long-term viability. First, after evaluating several taxi app providers UTWSD has negotiated a favorable contract with one. Second, with the expert help of Democracy at Work Institute and financial support from a California Employee Training Panel grant, we were able to facilitate the establishment of United Taxi Cooperative (UTCO). Third, we are continuing to build political buy-in at the local, state, and national level necessary to operationalize this vision. The only missing piece is a government contract, access to which is controlled by neoliberal procurement processes that often award the contract to the lowest bidder and fail to account for worker equity in the process.

A Strategic Intervention for Building Economic Democracy
In our past research, we have identified several barriers that pose challenges to our vision of “the public option.” These barriers include limited resources and workers having limited agency over the design of work systems, among others. While we have successfully overcome some of these obstacles, the lack of public support in terms of contracts, policies, and infrastructure remains the most significant hurdle to achieving economic democracy in the taxi industry.

Past research has already highlighted the struggles faced by taxi cooperatives when competing against rideshare companies in the open market, mainly due to intense price competition. In light of these challenges, organizations like UTWSD and UTCO have made a strategic decision to refrain from direct competition with Uber and Lyft. Instead, they are focusing their efforts on influencing public procurement processes for on-demand transportation, aiming to prioritize worker equity.

As a 2023/2024 ICDE fellow researcher, my work will build upon their efforts by exploring how workers can intervene in the ongoing collaborations between the state and the market, particularly through neoliberal procurement processes, to advance their interests. I will further detail the critical role played by worker advocacy organizations rooted in marginalized communities and shed light on the support they require to effectively realize the vision of economic democracy.