The Reason It Is Worrisome That Amazon Has Stepped In Where Government Failed

Western societies and economies have belatedly learned the cost of being too dependent on China.

The next question is when, not if, that very similar threat from Amazon will become apparent. JL

Julia Wong reports in The Guardian:

Amazon is poised to become one of the major winners of the coronavirus crisis. As smaller businesses falter, it is expanding its dominance over American commerce and society. If all you care about is that you have enough toilet paper, groceries and entertainment to make it through the crisis, the United States of Amazon is not bad. (But) as unemployment mounts, Amazon’s coercive power over its workforce will increase. (And) the threat that Amazon’s already outsized size and power will expand has real costs for creativity and innovation. “We can have democracy or we can have Amazon Prime, but we can’t have both.”

It is calling up 100,000 troops, extending grants to small businesses, prioritizing essential goods, and cracking down on profiteers.

No, that’s not the United States federal government’s response to the coronavirus pandemic: it’s Amazon’s. The e-commerce behemoth is poised to become one of the major winners of the coronavirus crisis. As smaller businesses (even those that are not in any sense of the word small) falter and fail, Amazon is expanding its dominance over American commerce and society.

It’s less and less far-fetched to imagine “the everything store” becoming the only store. And with so much rancor and incompetence on display in Washington DC, Amazon’s efficiency and competence has become a source of comfort and security, at least for those of us who can afford a Prime membership.

Many of Amazon’s moves over the past few weeks have had the distinct flavor of government.

The hiring of 100,000 staff and a $2-an-hour pay raise is akin to a 21st-century Works Progress Administration (WPA), only private. Amazon’s hometown noblesse oblige – extending its beneficence to small businesses around its Seattle offices so that they might live to serve Amazonians another day – is akin to a government stimulus package. Amazon’s decision to stop accepting non-essential products from third-party sellers who use its warehouses is essentially Amazon regulating the marketplace.

If all you care about is making sure that you have enough toilet paper, groceries and streaming entertainment to make it through the crisis, the United States of Amazon is not all that bad. I imagine that large swaths of the professional and upper middle classes will be quite content and well cared for under that regime. But as my sister recently said to me, in a paraphrase of Louis Brandeis, “We can have democracy or we can have Amazon Prime, but we can’t have both.”

The WPA put millions of Americans to work building roads and bridges and creating arts and culture that enriched America. Amazon’s goal is to enrich its shareholders. Do you trust Jeff Bezos to use his de facto regulatory power to benefit the greater good? And if you don’t, what is your recourse?

As unemployment mounts, Amazon’s coercive power over its workforce will only increase. Last weekend, I spoke to several Amazon warehouse workers who were grappling with fear and uncertainty around coronavirus and their risk of infection in the workplace.

Matthew Fyall, a 26-year-old stower at Amazon’s warehouse on Staten Island, New York, said he was frightened of “being contaminated” at work – he has a young daughter at home – but also concerned that any infection might shut down the worksite.

“At this point, we’re sort of being forced to go to work because we still have to live,” he told me. “I do have to get my Metro card, I do have to get food. The job can stop, but the bills are going to come, your stomach is still going to growl, life is still going to go on.”

William Stolz, a 25-year-old picker at an Amazon warehouse in Shakopee, Minnesota, said that one of his employer’s adjustments to the pandemic was to suspend meetings of the worker safety committee, a group that has been at the center of significant workplace organizing at the warehouse. “I partially understand the reason,” Stolz said, since public health officials advise against large gatherings of people. “But I also don’t think management is going to miss having it.”

Meanwhile, the threat that Amazon’s already outsized size and power will only expand has real costs for creativity and innovation.

“If you want to have a diverse, competitive economy, where people invent new things, write new books, and come up with new ideas, you need to have diverse pathways to market,” said Stacy Mitchell, the co-director of the Institute for Local Self-Reliance. “We could see the distribution of consumer goods collapse into a single pipeline named Amazon. It’s incredibly risky.”

There is a fragility that comes from relying on a single pipeline. If we let Amazon’s strength over dominate our entire economy, we may just find out how weak we are.