A Rant About Jeff Bezos

I have long believed that there is a special place beyond the outer reaches of Hell that awaits Jeff Bezos. During the era of COVID-19, I am more convinced than ever.

There may be no other person in corporate America as awful as him in my opinion. I believe he has truly and fully unseated Sam Walton and all other capitalists who took no prisoners and trampled on the littlest guy in their quests to be richer than God.

Jeff Bezos has achieved that (the being richer than God bit). He is, according to Forbes, by far and away, the richest person in the world. He has almost double the wealth of Bill Gates.

His net worth is $131,000,000,000

Do you see all of those zeros? That’s billions. Not mere millions. And look, it’s fine for people to make money. What pisses me off about Bezos is how he has done it, who has suffered because of it and the pathological selfishness he has exhibited to protect and maintain it. He could by a McMansion and a yacht every single day forever and never run out of money. Bezos’ net worth is 2,687,125 times the median US household income and equivalent to 0.85% of US GDP. I get it. We live in a capitalistic society, and that’s fine. I respect his idea and his vision, but it’s his greed and his lack of concern for anyone else is what bothers me.

He has:

  • Mowed over everyone in his path to achieve success;
  • Shirked his civil duty of paying taxes;
  • Run his business in an inhuman and unethical manner;
  • Failed to be a contributing member of society;
  • Acted unpatriotically; and
  • In this time of crisis, continues to be a part of the problem when he could be a part of the solution.

TRAMPLING THE LITTLE BOOK SHOP ON THE CORNER

You know when you’re watching a blow-out of a soccer, basketball, football, etc. game and it starts to just be mean when the other side keeps scoring? That is Bezos on the grandest possible scale.

When it started, young Jeff had a daring vision, and he invested his small savings and even his parents’ nest egg as capital. Risky. I’m sure there are plenty of folks out there who did the same and now they are not welcome at Thanksgiving. He started small. He started by selling books online in 1994.

Already Barnes  & Noble and Borders combined had the lion’s share of the market and were making it harder and harder for the small book sellers to survive, but it is notable that in 1994, there WERE still about 4,000 small book sellers in the US. There were two giants and there were still books being sold and making up a portion of the revenue in stores such as Walmart, so while not an even distribution, there was a distribution.

Amazon took advantage of a couple of things. They were able to buy directly from distributors, and therefore offer a huge catalog of titles, and they did not need a physical store. One could argue that this was just good business and there was nothing unethical about what he was doing. One reason for doing this was the 1992 Quill Corp VS North Dakota  ruling that said that companies did not need to pay sales tax in states where they did not have a physical presence. This began to save Jeff Bezos and the consumers money. (More on this in a minute.)

In 2011, Borders filed for Bankruptcy. Barnes & Noble still operates, but was sold and has closed over 150 of its stores. According to one source, the number of independent book sellers was more than halved between 1994 and 2007 and then surged a bit after the hole left by the closures of many B&N stores and all of Borders. As it stands now, there are about half (1900) of the independent bookstores that there were in the 90s. The e-book market began to play a role as well and Bezos was able to offer e-books for cheap, taking a loss, to bring people in, which in the long run, increased is profits.

Books were not enough for Bezos and his marketplace began to expand.

UNDERCUTTING ALL THE OTHER LITTLE SHOPS

Some argue that the Amazon Marketplace offers a platform that small businesses would not otherwise have, but I argue that this is a lesser of evils situation for the small businesses. The commercials cheerily depict the small business owner able to get their goods out to the world, but at what cost?

I personally have a small business product that I know and love. If I buy directly from the merchant, it costs me about $2 a unit ($27.95 vs $29.95) more than the same product on Amazon, and I have to pay for shipping. In fact, the more I buy, they more I have to pay on shipping because the more they will have to pay to ship a heavier box. The genius of Amazon means that if I buy more at a less per unit cost, I will earn free shipping and save a ton over buying directly from the merchant. Clearly, Amazon is taking a cut from the merchant. So the merchant is selling for less, being undercut from its own stores (online and bricks & mortar) and then getting even less per unit because Amazon is taking a cut.

On top of that, there is evidence that says that Amazon tracks what is selling from the small retailers, then sells the same product for less, undercutting the small seller again and taking the profit.

How is this helpful to the small retailer? It’s not unless it can be demonstrated that moving increased volume at a decreased profit margin is overall good for their bottom line (and sanity).

NO TAX FOR THE RICH

Jeff Bezos and Amazon have fought tooth and nail to pay neither local and state, nor federal taxes, which the rest of us do. We all recognize that while we don’t like it, and we are going to take what advantages and breaks we can, we are going to pay income tax. For the average American, our individual income tax will not make or break the bottom line of the US government. It’s the collective that is important. For a company like Amazon and a person like Bezos however, when so much income is concentrated in one place and so little tax is being paid,  it does impact the budget of the overall country and that means it impacts your roads, your schools, your police in your own state. At a federal level, it impacts all that the federal government pays for, such as the $2 trillion dollar relief package right now.

As previously mentioned, Amazon has avoided paying state taxes in states where they do not have a physical presence. “But what about Washington state? Surely that state has done well thanks to Mr. Bezos,” you say. Surely, you jest. Amazon fought Seattle’s City Council on a tax that would be charged per employee. Amazon said it was unfair because they were providing all of these jobs! The tax was aimed at the wealthiest companies, so as not to unfairly punish the little guys. Amazon fought it hard, and the tax was reduced from $500 to $275 per employee in the final bill, and still Amazon was mad.

At the federal level. It is even more galling. Are you ready for this? Apparently, Amazon got $129 million in federal tax REBATES and $3 billion in state and local tax breaks in 2018. They paid no taxes in 2016, 2017 nor in 2018.

So then, finally in 2019, they paid taxes. They paid a lot, $162 million, right? But wait. That is a rate of 1.2%. Are you okay with you paying taxes at 20-30%, and the RICHEST company on earth essentially paying nothing?

Remember, Amazon didn’t exactly fill a whole. People were already buying products, they are just buying them now in a different way, so that revenue is actually a LOSS to the government. They would be getting it from another seller, but every time you buy from Amazon, the US citizen loses out.

You may also remember that Amazon has recently opened an east coast headquarters in Virginia, outside of DC. Because of the supposed value added he would bring to a region, there was a race to the bottom to woo him to come. The company asked cities to present proposals, and in the “‘“decision drivers’ part, Amazon asks cities to identify incentive programs available for HQ2 including tax credits/exemptions, relocation grants, workforce grants, utility incentives, permitting, and fee reductions. Amazon notes that ‘the initial cost and ongoing cost of doing business are critical decision drivers.'” So essentially, Amazon was promising to come in and bring jobs, but at what cost?  If small and mid-size business have to pay their corporate tax, property tax, etc., why shouldn’t Amazon? Why should a city open its doors and then get none of the millions of dollars it should get to host the company? Cities tripped over themselves trying to win the contract. It remains to be seen what, if any, benefits Crystal City, VA gains from the “win.”

Some in Seattle would not call it a win. Critics of Amazon have said that its impact on Seattle was detrimental citing massive increase of cost of living and of rents, increase of homelessness and the Amazon campus monopoly over the commercial real estate in the city.

The DMV (DC-Maryland-Virginia) metro area already has some of the worst traffic in the country and 5th highest cost of living.

And will Amazon improve things?

According to The Verge:

“The contract doesn’t require Amazon to provide construction workers with a living wage, what would typically be called a project labor agreement, and it doesn’t ask Amazon to contribute to Arlington’s affordable housing trust fund. Housing fund requests are typically made after a company comes back to Arlington with more specific development plans….

“On the flip side, Amazon is set to get paid by the county as hotel taxes increase. Amazon’s arrival in Arlington is expected to bump up hotel bookings and lead to a boost in hotel revenue, which the county would then skim off the top to give to Amazon. Amazon will be paid 15 percent of any hotel tax increases. Amazon will also get two days after any Freedom of Information Act requests to take appropriate action or disclose only records that are mandatory to disclose.”

Couple this with its lack of paying its share of taxes, and one can see why the mixed feelings. Will Arlington live to regret its decision?

Bezos’ personal tax records are not public knowledge, but tax experts say that since most of his wealth is in stocks, it is not taxed as income until he sells it, so his actual tax payment would be minimal when compared to his actual net worth. Another win for Bezos and another loss the state and federal government and the rest of the citizens.

POOR TREATMENT OF EMPLOYEES

One could forgive all of this if Amazon was providing good jobs though, right? The benevolent Emperor as it were. Yes, Amazon provides lots of jobs, but I said GOOD jobs. Bezos is a notoriously cruel employer. The big companies and banks have gotten a lot of flack in recent years because of the disparity between their CEOs and other top earners and the men and women at the bottom. I mentioned Warren Buffet before; according to that article, he makes only seven times what his lowest paid employees make while many top CEOs make 300 times and more what their, often minimum-wage employees earn.

While, apparently, his income is only about $80K a year, as previously mentioned, Bezos has billions of wealth in stock shares, for which he earns dividends, which are not taxed the same way as regular income. His employees earn a $15/hour minimum wage. According to this source, he earns the $30,000 that wage equates to annually (when working full time) every 11.5 seconds. I suck at math, but I calculate that to be $9,390,000/hour, which I believe is 626,000 times $15/hour. If you consider part-time and temp workers, that disparity would be even greater.

Amazon, like many companies, uses staffing agencies. I appreciate that there is a market for temp workers. I have worked MANY a temp job. There are many issues, however. Temp workers lose about half the wage the company pays for them to the agency (that $15/hour the direct hires earn, is likely NOT what a temp earns); there is no job stability; there are no benefits; liability falls to the agency, NOT the employer. While at busy times, Amazon may need a larger workforce, he gets away with paying those workers even less with even fewer benefits.

Rather than saying, “Hey team, thanks for all your hard work, let me show you how much I appreciate you!” Jeff is like, nope. Mine, all mine.

Some companies, such as REI, operate in a way that allows its customers to be shareholders and pays them a dividend of earnings, and some companies are employee-owned, so the employees all earn more when the company succeeds. Clearly, Amazon is not either of this models.

Bezos has been notoriously awful to work for. I googled “treatment of Amazon workers,” and this is what it pulled:

Annotation 2020-03-31 122846

Bezos has prided himself on the speed and efficiency of the Amazon warehouse and shipping, which speeds products to your door, but it comes at a huge cost to the human capital.

Opening any of those links brought stories of working conditions you would never expect in the Unites States. From tales of injuries, stringent quotas with penalties, lack of breaks, inability to use the bathroom, fainting on the job, and even deaths, the conditions at Amazon fulfillment centers sound like a sweat shop in a third world country or US factories during the industrial revolution. Workers talk about being fired when injured and receiving poor workers’ and medical compensation, while these injuries keep them from finding other employment. The stories of hardship from employees who were barely getting by in the first place after an injury caused BY THEIR JOB is heartbreaking.

The richest man in the world apparently can’t: 1.) Make his workplace safer; 2.) Hire enough staff to be able to deliver what is promised reasonably; 3.) Pay employees well enough that they can live a decent life; 4.) Take care of injured workers; 5.) Take care of the families of workers who die on the job (which frankly, should happen very rarely in a decent environment!); 6.) Share in the success that is gained by their blood, sweat and tears.

I understand that a company wants to look out for its bottom line, but as the richest company in the world headed by the richest man in the world, the argument that they “provide jobs,” is pretty weak against the backdrop of the environment in which those jobs exist. Why doesn’t Bezos hire more workers, which would help the business function better? Increase safety standards; which would save lives and bodies? Increase worker benefits, which would improve morale? Increase wages, which would attract better workers and keep them longer? Why?

Because those things cost money.

And he wants ALL of the money.

ON GIVING

This part is easy. Jeff Bezos doesn’t give. He keeps his wealth. So while Buffet and Gates and countless others are redistributing their wealth, Bezos is apparently enjoying swimming in it.

Annotation 2020-03-31 125142

There is an argument that says that Bill Gates and Warren Buffet would be richer than him except that they have given so much of their wealth away. Bezos needs all $161 billion for himself, apparently.

It appears, in fact, that he is the only one of the world’s top five richest people who have not signed the Giving Pledge, where the world’s wealthiest pledge to give the majority of their wealth away; 50% or more.

In 2018, he landed at #23 (he is number 1 in wealth remember) on the list of the Top 50 philanthropists. He committed $2 billion dollars, but gave less than $1 billion that year in a fund he set up to combat poverty and homelessness. This represented 1.3% of his net worth. That would be like someone making $100,000 giving $1,300, but actually it wouldn’t because someone making $100,000 still probably worries about bills. Jeff Bezos does not have to worry about his bills.

I make less than that and I give 3% of my gross income monthly to charity. This does not make me a saint. I can afford it. I basically don’t feel it. I spent years as a server. Jeff’s 1.3% is like the guy who would leave a $0.25 tip. Like, don’t bother, dude.

FEDERAL WORKERS

At the end of 2018/beginning of 2019, a huge portion of the federal government was shut down, and about 800,000 DC-area federal workers were not getting paid.  For many families, especially those with kids and those where both earners were impacted, the fallout was devastating.

The local businesses swung into action. Loads of major companies gave money, but what was perhaps most inspiring was the smaller, local food establishments offering free lunch, employee discounts to federal employees, specials, etc. Milk Bar, & Pizza, Bread Furst and others all jumped into help. The biggest helper of all was, arguably José Andrés and his Think Food Group. All of his restaurants offered free lunch for every day of the shutdown to any federal employee, and he set up an impromptu soup kitchen. 

Jeff Bezos, who had just won the contract and was moving to the neighborhood was silent. He had also recently (2017) acquired Whole Foods, a DC-metro favorite with multiple locations and had owned the largest DC-are newspaper, the Washington Post since 2013. He was a local, a neighbor.

Did he offer federal employees a discount at Whole Foods or a food basket? Did he offer them free Prime Membership or free items at Amazon? Nope. He did nothing. NOTHING!

And yet, the federal workers are likely a huge share of his market. The overseas members of the military, Department of State and any agency housed in an embassy or on a base overseas get the benefit of paying domestic shipping prices to have items sent to those addresses. Families live for many years overseas and nowadays they rely on Amazon to bring them even items they could buy on the local market because, like everything else, it is cheaper and easier on Amazon. Did Jeff Bezos feel the need to thank them for their service or their business during the six weeks when they were not getting a paycheck? No he did not.

COVID-19

I write this during an enforced period of isolation and quarantine. The world has screeched to a halt. Only essential businesses remain open, so that includes grocery stores. While businesses around the country and the world suffer; while millions of Americans worry about where rent will come from; while homelessness becomes a more real fear; and while front-line responders worry about their exposure to the virus, Amazon keeps going. Amazon workers are being forced to continue to work without consideration for the social distance advice and in spite of workers testing positive.

Workers are going on strike as they fear for their health and safety, working without protective clothing and equipment and continuing to work in close quarters, but the worker who led the strike in NY was allegedly fired.

And once again, Jeff is missing an opportunity to be the good guy. He could donate masks or ventilators purchased from his vendors. He could offer everyone free shipping. He could limit purchases to only ESSENTIAL items, so that his workers are not overwhelmed and working in close proximity to one another. He should be reducing volume right now, not trying to increase it.

To make matters worse, he (and others) have been accused of priced gouging. Investigators found that Amazon had “substantially raised its own prices on products like hand sanitizer, protective masks and toilet paper.” Not only is he not lending a hand, he like a vulture, is taking advantage of people in their most desperate moments. He is kicking the collective American while we are down. A colleague of mine told me a box of cereal on Amazon was $15 last week. Her kids, needless to say, will be going without.

And yet, shoppers turn a blind eye and continue to patronize his business.

SHOPPING ELSEWHERE

I was living in London in 2010 and there was a lot of noise about Bezos and VAT (sales tax) when selling overseas. Another example of him not paying his fair share of taxes. I decided that I could live without Amazon.

I have lived overseas for a number of reasons for over ten years, and while I get some things sent, I mostly shop on the local market, or go without. There is nothing that I cannot live without that is not available. People sent me care packages when I was a Peace Corps volunteer, which was always appreciated.

I believe that consumers have a powerful voice. If the consumers spoke out against the practices of Amazon and took their money elsewhere, he would be forced to change, but instead, most people choose what is easiest, fastest and cheapest over what may be best.

I cannot, in good conscience, give that man anymore of my money and

I wish others would not either.

One can very often purchase the same item directly from the small retailer. One can almost always go to their local grocery store; most deliver these days too. One can find small retailers on Etsy (beware, they aren’t ALL small retailers). One can order delivery from any number of other retailers and at least spread the wealth around. One can go to a local market or small retailer and support the neighborhood.

We make a choice with every purchase that we make and that choice impacts not only our own bottom line, but also everyone who touches that product before it gets to us.

Here’s what I think Jeff Bezos should do:

  • Truly support small retailers and give them a fair share on the Amazon Marketplace
  • Pay 100% of his workers a livable wage, provide ALL with benefits and consistent hours. Maybe even give them a stake in the company!
  • Stop hiring through staffing agencies or provide for the same wage as the direct hires.
  • Create a safe work environment for everyone.
  • Treat his employees with respect and dignity and offer them reasonable benefits packages, perks, bonuses, etc.
  • Pay his share of local, state and federal corporate taxes
  • Give back a meaningful sum of money charitably that is not self-serving
  • Commit to the Giving Pledge
  • Have a positive impact on the communities where his company is based. Be a good neighbor.

Until he does that, I don’t see why anyone should shop from Amazon. (I haven’t even talked about Whole Foods. That broke my heart!) We should be rewarding good behavior or we may all live to regret it.

Every time you spend a dollar, think about the positive and negative impact that dollar is having, and try to imagine if that impact was directly on you or your family. What choice would you make?

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