Tuesday, September 11, 2018

Amazon Is A Threat To Our Democracy And Capitalism

The title of this piece is bold and may seem like an exaggeration but in previous posts, I have written about several of the cozy arrangements Amazon enjoys with our government and some of its new initiatives are taking the company to a new level. It must be noted Amazon's lust for power appears without limit. The deal Amazon is now trying to push through Congress grossly exceeded anything it has undertaken in the past and would place the company in a position to threaten our very democracy. The technology giant which is no stranger to sweetheart deals and has lined the pockets of its CEO Jeff Bezos at taxpayer expense is quietly moving in a direction that is destined to create even more controversy. Amazon is on the verge of winning a multibillion-dollar advantage over rivals by taking over large swaths of federal procurement.

Amazon Is Moving To Place Beyond All Control
This brazen move makes it increasingly difficult and almost impossible to ignore the fact that Amazon's CEO Jeff Bezos owner of America's most influential newspaper, the Washington Post, has embarked on a mission to quietly grab more power. When you couple the voice of the Washington Post with a company so deeply involved with discovering and archiving detailed files and information about individuals and politicians across America you command a great deal of muscle and clout. Because of this and some highly effective lobbyist, the federal government seems unable to stop giving Amazon, even more, advantages over the brick and mortar stores that line the streets of our communities. This has become a dagger into the heart of the capitalist system and is allowing Amazon to flourish while removing the ability of other companies to compete.

Congress under the cover of darkness has started down the path to change the federal purchasing plan that would result in Amazon’s most lucrative government handout yet. The language buried in Section 801 of the House-passed version of the National Defense Authorization Act would in effect move Defense Department purchases of commercial off-the-shelf products to online marketplaces. The House Armed Services Committee Chairman Mac Thornberry, argues it is needed to save money over the burdensome current system and that some IT equipment could be purchased more cheaply on the open market than through the current GSA’s “schedules.” The plan calls for developing an online marketplace platform through which federal agencies can buy products such as paper clips, bottled water, computers, office furniture and more in the same way any business would.

The legislation calls for a platform designed to “enable government-wide use of such marketplaces” which rules out all small players unless they employ a procurement and supply management firm big enough to serve the entire U.S. government by offering multiple suppliers for a massive number of products with constantly changing selection and prices. With all Amazon's influence, it is not an accident that Amazon Business is the company best positioned to exploit what is basically monopoly control over a great deal of the $53 billion in federal purchasing for the commercial supplies bought through no-bid contracts. As to whether this becomes law in the future the fact that Amazon got it through the house should cause us great concern and is proof of the company's ability to manipulate Washington  All this reeks of corruption and constitutes a major shift in power that would set up opportunities for abuse not to mention massive control over suppliers.

Even the suggestion of a pilot program is just another way for Amazon to wedge its foot in the door. It is important to remember by simply providing the platform necessary for companies to sell through to their current customers Amazon would extract money from those third-party sellers and collect billions of dollars annually. Typically it receives 15 percent to 20 percent of the proceeds from such sales, which means a huge revenue stream for Amazon for doing basically nothing while vendors are forced to cough up as much as half their margin. This would prove devastating to many small businesses. Amazon would also get an enormous amount of data on agencies which they could then use to identify top competitors and drive them out of the marketplace with increased fees or other rules changes. And it means many discounts that are normally negotiated for bulk rate purchases would flow not to the government and taxpayers but would be diverted into Amazon’s pocket.

This is only one of several initiatives Amazon is currently pursuing behind the scenes to quietly extend their hold over America. The people of this great country are only beginning to see how Amazon has begun to reshape America as the number of brick and mortar store closings increase on a daily basis. Fortunately, more and more articles are beginning to be published criticizing Jeff Bezos and Amazon for its abusive policies and calling it out for accountability. It is time for our government to stop subsidizing this monster it has allowed to grow and take shape and recognize it for what it is, a power hungry job killing exploiter that is destroying communities.

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Footnote; Below are the links to several other articles about Amazon.
 http://Online Transaction Fee Could Blunt Amazon's Edge html
 http://brucewilds.blogspot.com/2018/07/amazom-shipping-rates-deemed-to-low-too.html
 http://brucewilds.blogspot.com/2018/04/trump-and-bezos-face-off-clash-of-titans.html

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