Amazon Poses A Serious Threat To Freedom And Free Markets

Authored by Mike Krieger via Liberty Blitzkrieg blog,

It wasn’t until earlier this year that I became really concerned about Amazon.

Sure, I had warned people previously of the dangers of an oligarch like Jeff Bezos owning a major national newspaper like The Washington Post, and I’d also highlighted Amazon’s creepy $600 million contract with the CIA, but I didn’t truly grasp the bigger picture until recently.

It seems I’d been too focused on the financial system and other predatory industries to see the gigantic threat metastasizing in the room. If that happened to me, I’m sure many of you aren’t paying close enough attention to the risks to freedom and free markets posed by Amazon and its oligarch CEO. That’s why I decided to write this post.

This piece will be presented in two parts.

First, I will highlight several recent articles that do a great job describing how dangerous Amazon, and its richest man in the world (net worth of $95 billion) CEO Jeff Bezos, is.

 

Second, I’ll discuss my personal mission of redirecting more our family’s money away from this corporate behemoth.

Let’s kick things off with a few excerpts from a great article by Caitlin Johnstone titled, Friendly Reminder That Jeff Bezos Is Trying To Take Over The Universe:

I will say it again for emphasis: Jeff Bezos, who has used his business prowess to become the wealthiest person in the world, did not purchase the Washington Post in 2013 because he was expecting newspapers to make a profitable comeback. That did not happen.

 

What did happen is the world’s richest plutocrat realizing that he needed a mouthpiece to manufacture public support for the neoliberal corporatist establishment that he is building his empire upon. This is why WaPo ran sixteen smear pieces on Bernie Sanders in the span of sixteen hours at the hottest point in the Democratic presidential primary battle.

 

Last year Silicon Valley venture capitalist Chamath Palihapitiya said that Amazon is “a multi-trillion-dollar monopoly hiding in plain sight.” In June Stacy Mitchell, co-director of the Institute for Local Self-Reliance, wrote that Amazon is trying to “control the underlying infrastructure of the economy.”

 

Bezos continues to get cozier and cozier with the US power establishment as his empire metastasizes across human civilization. He kicked WikiLeaks off Amazon servers in 2010, he scored a 600 million dollar contract with the CIA in 2013, he joined a Pentagon advisory board in 2016, he hung out with Defense Secretary James Mattis in August, and he’s spent nearly ten million dollars this year lobbying the federal government, which is likely what led to an NDAA amendment gifting Amazon a $54 billion market it’s expected to dominate as a supplier to the Pentagon.

There’s a lot there, so let’s dig a little deeper. In particular, I want to point people in the direction of the MotherBoard article by Stacy Mitchell, Amazon Is Trying to Control the Underlying Infrastructure of Our Economy. Here’s some of what we learned:

We often talk about Amazon as though it were a retailer. It’s an understandable mistake. After all, Amazon sells more clothing, electronics, toys, and books than any other company. Last year, Amazon captured nearly $1 of every $2 Americans spent online. As recently as 2015, most people looking to buy something online started at a search engine. Today, a majority go straight to Amazon.

 

But to describe Amazon as a retailer is to misunderstand what the company actually is, and to miss the depth of the threat that it poses to our liberty and the very idea of an open, competitive market.

 

It’s not just that Amazon does many things besides sell stuff—that it manufactures thousands of products, from dress shirts to baby wipes, produces hit movies and television shows, delivers restaurant orders, offers loans, and may soon dispense prescription drugs. Jeff Bezos is after something so much bigger than any of this. His vision is for Amazon to control the underlying infrastructure of the economy. Amazon’s website is already the dominant platform for digital commerce. Its Web Services division controls 44 percent of the world’s cloud computing capacity and is relied on by everyone from Netflix to the Central Intelligence Agency. And the company has recently built out a vast network of distribution infrastructure to handle package delivery for itself and others.

 

Companies that want to reach the market increasingly have no choice but to ride Amazon’s rails. With Prime and digital assistant Alexa, from GE appliances to Ford cars, Bezos has lured a majority of households into making Amazon the default provider of everything they order online. Most Prime members no longer comparison shop. This has forced competitors of all sizes—from major brands like Levi’s and KitchenAid to small-scale producers, e-commerce innovators, and independent brick-and-mortar stores—to abandon the idea of reaching consumers directly. Instead, they have to rely on Amazon’s platform to sell their goods.

 

Amazon exploits this dependence to dictate terms and prices to suppliers, and it uses the data it gathers from companies selling on its platform to weaken them as competitors. A company that designs a popular product and builds a market for it on Amazon’s site can suddenly find that Amazon has introduced a nearly identical version and given it top billing in search results. One study found that, after a retailer becomes a seller on Amazon, it’s only a matter of weeks before Amazon brings the merchant’s most popular items into its own inventory.

 

With commerce rapidly moving online, Amazon has positioned itself as lord of the realm, which means that online commerce is no longer a market in any meaningful sense of the word. It’s now a privately controlled arena where a single company sets the terms by which we may exchange goods with one another and decides which products—which new authors, which new innovations—get to find an audience.

The sneaky thing about Amazon’s increased dominance in so many key aspects of our lives is that much of the perniciousness is hidden. No one’s going to tell you about all the retailers who have gotten pressured or destroyed via its tactics while you’re happily clicking “add to cart” and smiling about 2-day free shipping. In this sense, it can be best compared to the evils of factory farming. Most people just simply have no idea about the immense damage going on behind the scenes as they indulge in incredible convenience and what looks like a good deal.

While dominating individual and family budgets is all well and good, Bezos is no fool, and he knows the best milk cow on planet earth comes courtesy of the U.S. taxpayer via government spending. Speaking of which, have you heard of the “Amazon amendment” attached to the 2018 NDAA? Didn’t think so.

The Intercept reports:

Under pressure from anti-monopolists, House and Senate negotiators tweaked the controversial “Amazon amendment” this week, but waved it through nonetheless. The provision seeks to turn over federal procurement of commercial off-the-shelf items, a $53 billion market, to e-commerce portals. And with Amazon as the runaway leader in that space, critics say that even with the modifications, the provision still favors the online retail giant, giving it a pathway to billions of dollars in new revenue…

 

Amazon charges third-party sellers for the privilege of using its platform, anywhere between 15 and 20 percent of gross sales. If Pentagon procurement, and potentially all federal procurement, shifts predominantly to Amazon, it would collect billions of dollars annually without doing much of anything.

 

And in addition to hosting third-party sales, Amazon competes against those third parties with its in-house brands, armed with superior data to know what gets purchased and what doesn’t. Procurement officials will be susceptible to Amazon’s usual suite of behavioral nudges, like adjusting search results or controlling what gets into the “buy box,” the top option it suggests for purchases.

 

Plus, the whole concept of relying on web portals for everyday purchases gives away the government’s leverage to buy commercial items in bulk at a superior price to the open market.

 

Amazon hired the former chief acquisitions officer of the United States, Anne Rung, to run Amazon Business’s public sector division and has signed numerous local government contracts and federal agreements. The company has lobbied on the NDAA and the “modernization of the procurement process” this year, according to federal disclosures.

 

“This amendment looks like it will crown Amazon as an official gatekeeper to government procurement,” said Lina Khan of the Open Markets Institute. “Government spending that was previously dispersed across hundreds of distinct companies will now instead all be channeled through one company, with Amazon collecting a tax.”

 

The NDAA, one of the few bills Congress passes every year, now goes to the House and Senate for final approval. It’s not expected to face much opposition. Few members of the conference committee interviewed by The Hill even knew of the existence of the Amazon amendment, let alone rank-and-file representatives.

Congress doesn’t know about the Yemen war. Congress doesn’t know about the Amazon amendment. What does Congress know, and more importantly, why are these people making important decisions?

Moving on to a more personal note, I only started getting up to speed on many of the concerns described above earlier this year. That’s how behind the curve I’ve been when it comes to the danger staring us in the face from Amazon and Jeff Bezos. As soon as I recognized the threat for what it is I started to examine my own life and our family’s purchasing decisions much more closely.

As parents of two young children, we’re constantly replenishing stuff to keep the household going, with most of these items purchased online by my wife. When I suddenly put two and two together and realized that most of the items we were buying appeared on our porch in Amazon boxes, I asked her to try to purchase from elsewhere, even if it meant paying a bit more. I’m happy to say we’ve successfully cut down on Amazon purchases significantly. Around the same time, Amazon announced its intention to buy Whole Foods, which presented an even more difficult challenge.

I enjoy grocery shopping and I take our son with me once a week on the big shopping run. The large Whole Foods in Boulder is a great store, and I’ve always been pleased with the general selection as well as the enormous butcher section. We spend a lot of money there, and as soon as I found out Amazon would be buying it I started feeling dirty. To move away from Amazon groceries would likely mean several significant inconveniences. First, I’d have to find an alternative store with a comparable selection. I went to various stores in the weeks following the announcement, but left very underwhelmed. I knew of a great independent butcher so I started going there, but that’s the most I was able to do. I was still giving Bezos way too much of our family budget. It wasn’t until yesterday that I may have finally found a replacement for Whole Foods. It’s not as magnificent of a store, and it’s far less convenient location-wise, but it has 90% local ownership and this weekend I will do a big shop there for the first time.

The purpose of this post isn’t to convince you to avoid or boycott Amazon as much as possible. That’s up to you. I’m someone with the resources and time to move my family’s budget away from Bezos, and it’s still been extremely difficult. For other people, the convenience and price points offered by Amazon may be too significant to pass up. I get it.

That said, I do want people to start thinking a lot more about how they spend their dollars. Do you complain about the financial system, yet have your savings at a TBTF mega bank? If so, why? Do you complain about Jeff Bezos, his ownership of The Washington Post, Amazon’s predatory attack on competitors and it contract with the CIA, yet still have Amazon boxes piling up on your porch? If so, why?

How each and every one of us spends our money is far more meaningful than which puppet we vote for every four years. You vote every single day. Time to grow up.

 

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Comments

taketheredpill Thu, 11/16/2017 - 10:23 Permalink

The FTC's competition mission is to enforce the rules of the competitive marketplace — the antitrust laws. These laws promote vigorous competition and protect consumers from anticompetitive mergers and business practices. ... For anoverview of the types of matters investigated by the Bureau, read CompetitionCounts.Guide to Antitrust Laws | Federal Trade Commissionhttps://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-la…

NiggaPleeze mtl4 Thu, 11/16/2017 - 15:40 Permalink

 Two words:  PONZI SCHEME.Bitcoin is the poster child of a PONZI SCHEME.  The definition:

A Ponzi scheme is a fraudulent investment operation where the operator generates returns for older investors through revenue paid by new investors, rather than from legitimate business activities or profit of financial trading.

The "inventor" of the code now has some $7 billion of Bullshitcoins, which he did nothing to earn; it's just one idiot after another piling into the ponzi, with no wealth whatsoever being generated by the enterprise and subsequent bigger idiots enriching the ones smart enough to get out.Just like the Tulip bubble, I don't know when it will pop, but I do know Bullshit coin is worth virtually nothing.  As anybody can create their own bullshit coins with marginal effort, just like anyone can collect sand for marginal effort - hence all of the Bullshit coin and a truckload of sand have the same value.

In reply to by mtl4

LightBeamCowboy ParkAveFlasher Thu, 11/16/2017 - 11:46 Permalink

I started boycotting Amazon after they yanked Prof. Jim Fetzer's book _Nobody Died at Sandy Hook_ when it started to sell too well for Bezos' comfort. My boycott is a 100%, no-backsliding commitment , and I'm finding it easy to maintain. Anything you can get at Amazon you can either find somewhere else or do without. Actually, boycotting Amazon can save you a lot of money.

In reply to by ParkAveFlasher

NotApplicable Endgame Napoleon Thu, 11/16/2017 - 12:10 Permalink

And all of this drama about stopping Amazon is going to have no more effect than it did against Walmart.Why? Because it's only addressing symptoms, rather than the true problem.As long as money is debt-based, bank originated fiat (AKA, IOUs backed by violence), there is no stopping the money cartel from destroying every business where it gains a foothold, as honest people cannot compete against an infinite checkbook.

In reply to by Endgame Napoleon

lil dirtball Gap Admirer Thu, 11/16/2017 - 10:54 Permalink

> Then quit buying from Amazon

How do we quit these mofo's?

"According to a description of the bill, first obtained by NBC News, the “Fix NICS Act” offers a handful of solutions to help get all the necessary records uploaded, including asking federal agencies and states to produce plans to upload and verify the criminal and mental health records necessary to bar unfit purchasers from buying a weapon. The bill would also create incentives like grants for states that comply with the uploading requirements, and accountability measures like withholding political appointees bonuses for agencies that fail to do so."

https://www.nbcnews.com/politics/politics-news/senators-near-bipartisan…

Tax reform? Yeah ... that's a complex situation.

Fucking over the hoi polloi's supposed rights? NO FUCKING PROBLEM.

And - WTF is a 'political appointee bonus' and where does that m0ney come from?

In reply to by Gap Admirer

earleflorida lil dirtball Thu, 11/16/2017 - 19:19 Permalink

the problem is AMZN & FB (etal.) are agents of the 'Square Mile'...--- unlimited capital to buy into the 21st Century technologies.note: where do these particular two companies,... the former in commerce and the latter in ($propagandized$) marketing get their seed money?once the value-added celestial 'low-lying invaluable spectrum' is auctioned off, they will gobble it up perhaps partnering with a bell or two!Watch the appointments on the FCC, and ussa useless defensive air-space spectrum needed no moar, being 'BANDED about?'.yeah, their both going global... setting the ussa up as the money masters did in the late/19th, early/20th century.great prices, great products, fast delivery--- don't get any better does it.but when all competition is gone, they can, and will make supply and demand a tool to controll all markets.creating inflation and deflation by turning on/off the money spigot!bankrupting countries all over the globe...--- by simply 'locking-up' working capital which they control.note: this isn't just in america, they similarly are working in tandem with chinas' alibaba and renren,---... both being also finance by the brexit manifesto, designed by the 'sqaure mile', as china is the new world frontier for raping as india was so long ago?!? 

In reply to by lil dirtball

Creepy Lurker Gap Admirer Thu, 11/16/2017 - 11:23 Permalink

Here's an even better and more radical idea.Self-sufficiency. You can't do it all at once, you work towards it, and the closer you get the better off you are. Grow at least some of your food. Barter with your neighbors. When you shop, shop local.Like most behemoths, Bezos et al freely distribute the seeds of their own destruction. Go to Youtube and watch how-to videos. There are just scads of them for any activity you want to try. You just might amaze yourself with what you're capable of.Starve the beast. It can't live without our support.

In reply to by Gap Admirer

RedBaron616 Creepy Lurker Thu, 11/16/2017 - 11:35 Permalink

Shop local? All my local stores that sell anything I need are part of national chains. Only small shops that specilize in things like quilting classes can survive as a local shop. Not to mention that my state's Department of Transportation has made the traffic lights so out of sync as to make me not want to go anywhere because it takes an eternity to get there.

In reply to by Creepy Lurker

Creepy Lurker RedBaron616 Thu, 11/16/2017 - 14:58 Permalink

I should have stuck around a few minutes longer this morning, my bad, that. I try not to criticize without offer an idea, at least. Hopefully some of you will come back later, I did.What I was talking about is not buying every last thing that you need. Of course you will have to buy some things, we all do. But I also think you would really suprise yourself if you just try making a few of the things you need. Have you always wanted something like greenhouse? I promise you there are videos out there showing you how to build one out the scrap lumber in your garage and a roll of visqueen. Try heating it with a little rocket stove and grow fresh (really fresh!) salad all winter.Wife loves clothes? Would she consider taking up sewing? No need to buy an expensive machine, I got mine from a garge sale for less than $50. Works great, and I made my own window treatments and bedspreads. I learned how from watching videos, lol. It works.

In reply to by RedBaron616

Anon2017 Gap Admirer Thu, 11/16/2017 - 16:20 Permalink

I bought my first widescreen TV from Amazon because they offered competitive pricing and no extra charge for home delivery. My replacement nine years later came from Costco online. I had become a smarter shopper and kept better track of BlackFriday specials. The biggest Costco benefit, however, turned out to be the extra year of free warranty. The TV failed after about 20 months and Costco sent out a repair technician to replace the motherboard at no charge. There was no hassle.  

In reply to by Gap Admirer

TuPhat Gap Admirer Thu, 11/16/2017 - 13:28 Permalink

You don't live in a small town in south Texas.  Unless I want to drive for an hour or more I shop at Walmart.  There is a local grocery and I get groceries there.  There is a feed store for animal feed, fencing, and agricultural stuff but if they don't have it then I go to Walmart or shop online.  Sometimes Amazon is the cheapest.  My wife and I get a package from Amazon once every couple of months.  Zulilly on the other hand, my wife gets a package from them several times a week.  I refuse to live in a big city so my choices are limited.  I guess that's what freedom is.

In reply to by Gap Admirer

RedBaron616 ParkAveFlasher Thu, 11/16/2017 - 11:30 Permalink

Ever use a search engine or shopping bot? Are you really that lazy?Back in the day when Amazon only did books, they were caught twice with books that promoted adult-child sexual relations. Not only did they not apologize, they defended these sick books via the First Amendment and only took them down after a firestorm of protest.After that, I knew what kind of scum Bezos was and so I have never, ever bought anything from Amazon and I never will.

In reply to by ParkAveFlasher

Sonder Thu, 11/16/2017 - 10:24 Permalink

You're not wrong, but there's no denying that Amazon fills a massive want in the market. I buy almost all of my long-term products through Amazon and Newegg now, why the hell would I go back to brick and mortars? The threat of a monopoly is real, but if there's no apparent competition what are you supposed to do?

Sonder G-ray Thu, 11/16/2017 - 10:39 Permalink

Yeah? What other online retailers? I notice you're quick to chastise without offering any specific suggestions. I already mentioned I use Newegg to buy my electronics, not Amazon. I don't use Amazon's free shipping service either. And my job and hobbies are reliant on tech so thanks for the advice but "doing without" isn't really an option if I need to replace a hardware component. Why should I want to have to go to a store, to see a more expensive, smaller selection of items? I'm not arguing Amazon isn't a danger. What I'm saying is if you can't answer these questions in a compelling fashion you will NEVER push the average consumer away from Amazon. Most people don't give a fuck about the implications of a Monopoly and these are the people you need to convince to make real change. 

In reply to by G-ray

chunga Sonder Thu, 11/16/2017 - 10:48 Permalink

I'm in a remote area and it takes considerable effort to go to the brick and mortars. What pisses me off is that so many times what passes for customer service absolutely blows and makes we wish I'd just clicked it, had it delivered, for less $$$ without driving for half a day. 

In reply to by Sonder

Endgame Napoleon chunga Thu, 11/16/2017 - 10:54 Permalink

Managers hire / retain the frequently absentee mom gangs whose spousal income, child support or monthly welfare and child tax credits make up the difference between living expenses and low pay and, in a few cases, the less rough youth gangs who either live with their parents or in big groups of unattached, post-college roommates.

In reply to by chunga

Jon_Locke Sonder Thu, 11/16/2017 - 10:54 Permalink

I use Amazon to shop. As in look, not actually buy. Most of the time I can get what I want cheaper either from Bestbuy or walmart the exact same product. Even its the same price, its still cheaper because i have it delivered to the nearest store and pick it up thus no cost for shipping, making it cheaper.

In reply to by Sonder

tion Sonder Thu, 11/16/2017 - 10:56 Permalink

Someone had also mentioned jet.comWe have gone two months without ordering from Amazon now, and I don't see that trend changing anytime soon.  Now that I am out in the middle of nowhere, I can't even imagine what the true cost of 2-day shipping to me would be.  You city folk are subsidizing shipping for us stick people bigly.  But the Chinese started that shitshow when they got help hacking the shipping rates.  And of course, why bother planning ahead when you can have more immediate gratification instead?  Does the typical American even have enough in the bank to buy more than what they need right now?  But if we're really honest with ourselves, almost all of it is just moar shit that we don't even need or even want all that much, really.Amazon fills a massive want.  Butthurt won't change anything.  The future of retail isn't going to change, because the current system cannibalizes value at a disgusting rate. Amazon is garbage but something better isn't going to build itself.  You would probably be amazed if you did a thourough cost breakdown of almost any item in your home, and astounded if you took that a step further and broke it down into tracking the supply chain of each raw material into finished product, then followed all the distribution intermediary bullshit.  Value creators can't pocket more coin without cutting out the cannibals, because the prices would be too damn high.  I do think there would be a demand for something for smaller scale artisans/manufacturers, that falls somewhere between what Etsy was supposed to be (minus the made to order) and Amazon/Jet, Made in America only, plugged into an international fullfillment structure, maybe even partnered with Alibaba and Coupang type e-tailers. 

In reply to by Sonder

Peak Finance tion Thu, 11/16/2017 - 11:11 Permalink

There are people out here that buy ALL of their shit via Amazon. Amazon delivers ALL OF THIS SHIT to their houses for freeKeep in mind that our little community is deep rural and like 20 miles from the nearest town. Yet, they still bring all this shit out here for free. Impossible for this to be profitable for them, where is this money coming from??? 

In reply to by tion

yellowsub Peak Finance Thu, 11/16/2017 - 11:31 Permalink

Have a lower cost last mile carrier like LaserShip in metro areas.I was surprised I saw a LaserShip building logo attached to a recently built USPS distributiong / sorting hub around here...I'd admit i shop at Amazon for convenience especially around returns.  I'm not sure the new thing retailers are pushing with pick up in store when most people don't want to go to the store unless they offer a discount like Walmart does but even then I rather not step foot in a Walmart unless it's just too good of a deal on whatever I need with the pick up discount.  None are convenient to me and I value my time to not waste 1 hour to go there and wait in the pick up counter that never seems to have someone dedicated to work there.

In reply to by Peak Finance

tion Peak Finance Thu, 11/16/2017 - 13:21 Permalink

Actual costs of shipping are a bit like a dark hole to me, but as for the price of shipping, on Amazon I think that often, the manufacturers are eating most it, because they still come out ahead when they get closer to their end customers. For a manufacturer, selling on Amazon is a bit more like selling on consignment rather than wholesaling. For one item, you may see 6 vendors selling it, with one being the manufacturer.  The others, retailers/resellers, paid a (sometimes very steeply discounted) wholesale price. They can't compete with the manufacturer.   Part of the race to the bottom is the rules being haphazardly rewritten as manufacturers are getting closer to their end user, this is happening on a global scale.  Intermediaries that are unnecessary or don't actually add any value will get BTFO.  A lot of value that is not acknowledged or worth paying for to the consumer will evaporate, for better or for worse.  That's why we have so much cheap disposable garbage these days and so few well paid manufacturing jobs.Value cannibals of all stripes need to honestly reassess themselves and look for ways to add/create value. I am a nationalist, but I don't kid myself that somehow my time/effort/life is inherently worth more than someone else's across the world, and I am somehow entitled to live a more materially abundant life, simply because 'reasons'.  That's hegemony fantasy land thinking.  America needs to wake up, free lunch was always a lie.

In reply to by Peak Finance