Listening to Hillary Clinton on the campaign trail may lead one to assume she is against the sharing economy, or what she calls the “gig economy.” As she promised in her first major economic address at the New School in New York City, the gig economy is “raising hard questions about workplace protections and what a good job will look like in the future… I’ll crack down on bosses who exploit employees by misclassifying them as contractors or even steal their wages.”
But when it comes to her personal life, Hillary Clinton does not detest the gig economy—she loves it. The Clintons’ tax returns show that Hillary and her husband Bill are practically gig economy royalty. After leaving the White House, the Clintons earned just one percent of their labor income from employer paychecks. The rest ($198 million) came from a variety of independent contractor gigs.
Since 2000, the Clintons earned about $200 million from working (as opposed to real estate or other investments). Of that $200 million, $176 million of it (88 percent) came from work that is part of the gig economy, such as giving speeches and private consulting. If one includes income from other non-employee work (such as book promotions and sales) this number shoots up to $198 million, or 99 percent.
People sometimes mistakenly assume that the sharing economy is nothing more than a few new business platforms such as Uber, Airbnb, Lyft, and TaskRabbit. But this view severely understates the scale and scope of the sharing economy.
The sharing economy is, above all, about allowing workers to more easily market and provide their productive capital, which includes skills (such as writing or giving speeches) and physical resources (such as cars or living spaces). This core concept—that of providing brains, brawn, or useful equipment on a per-job basis—is not novel, but technological progress has made individualized, entrepreneurial work much cheaper and more efficient. This has opened countless possibilities for mutually beneficial exchange that were unimaginable just a decade or two ago.
But instead of celebrating the growth of these alternative earnings opportunities, Clinton criticizes the sharing economy for not being subject to the same workplace restrictions and protections that apply to formal employers and employees. Since sharing-economy workers are classified as independent contractors instead of employees, they cannot collectively bargain—something labor unions, which are longtime Clinton supporters, desperately want to change.
As the Teamsters Union wrote last summer, “Just because the business transactions of these so-called ‘sharing economy’ companies, such as Uber and AirBnB [sic], are accomplished using smartphone apps, doesn’t mean they’re progressive or new. Instead, these companies are simply recycling old ideas and taking us backwards to a time when workers had no rights on the job.”
These criticisms are based on the mistaken belief that individuals are incapable of deciding what is best for themselves. In terms of tax treatment and control of their work and schedules, the Clintons’ gigs closely mirror those of other sharing-economy workers—whether freelance journalists, personal trainers, or Uber drivers. And each sharing-economy worker assesses the benefits and costs of working as an independent contractor and decides what balance of flexibility and job security works best for them, just as did the Clintons.
Mrs. Clinton displayed this individualized work decision while defending her high speaking fees: “I thought making speeches for money was a much better thing than getting connected with any one group or company as so many people who leave public life do,” Clinton said. By connecting with a business platform, and not being subject to a direct employer, the sharing economy allows workers increased flexibility and control, benefits that many people value greater than the security of traditional workplaces. This applies both to millennials and to older generations, such as Clinton and her fellow Baby Boomers.
By giving speeches, writing and promoting books, and providing consulting services, especially to foreign governments, the Clintons have amassed a considerable fortune. For this, they should be commended. But Hillary Clinton should be praising the sharing economy that gave her these opportunities, not attempting to bury it.
Jared Meyer is a fellow at the Manhattan Institute for Policy Research. Austill Stuart is a contributor to Economics21. Follow Jared and Austill on Twitter.