I was under the impression that the only way the Uber/Lyft business model is even remotely viable (without continuous VC subsidy) is classifying drivers as contractors, meaning they don't have to pay them minimum wage or benefits, which lets them undercut taxis.
People (especially California) would like you to believe that. Uber drivers are rational beings, they know exactly how much money they are making, and they are aware of their taxes.
If Uber paid their Social Security and Medicare taxes, then Uber would just lower their base pay, and the net would stay the same. Or in other words the pay is higher because the driver has to pay those taxes.
I don't know one way or the other, but I have heard the argument that if you actually do all the math, particular with the reductions in pay more recently, it doesn't all net out.
Generally people do not act as fully rational economic actors, so we can't assume that this is not true based on the fact that people still choose to do it.
Which isn't to say they shouldn't have that option.
> 1) Uber is a public company now, it has not been VC funded for a long time
They also typically lose around $1 billion per quarter. Unless they figure out how to be profitable, they will eventually run out of money. So really, they are still burning cash on the roughly $20 billion of VC capital they raised, plus the money they raised during IPO.
And it has been losing tons of money for even longer. Without VCs to bail them out several times a year, how will they justify operating at a huge loss in France without a viable path to profitability?
