Jeff Bezos deserves props for standing up to blackmail by The National Enquirer’s publisher, David Pecker, who threatened to print sexually explicit pictures and texts of the Amazon founder if he refused to issue a false statement that The Enquirer doesn’t have a pro-Trump political agenda.
And Bezos also deserves props for buying The Washington Post and apparently keeping his hands off the editorial content, so far. In a changing media economy, there are a dwindling number of outlets like the Post which can afford the resources needed for the kind of in-depth local, national, and international news coverage that maintains an informed electorate a democracy needs.
It does take some courage for Bezos to stand up to The National Enquirer’s threats, even if he is the richest man in the world. So unlike ordinary mortals, there’s not much The Enquirer can do to actually hurt Bezos, except cause temporary embarrassment. Bezos can afford to expend unlimited resources to defend himself and counterattack.
To fight The Enquirer, Bezos has hired one of Hollywood’s toughest litigators, Marty Singer, who charges close to $1000 an hour. His clients have included Arnold Schwartzegger, Bruce Willis, John Travolta, Bill Cosby, and Sharon Stone. For his private investigator and security consultant, Bezos hired Gavin de Becker, who services an equally rich, powerful, and famous clientele.
At these prices, the cost of Bezos’s investigation could easily run into six or seven figures. So while it’s good that he’s fighting back, few besides the very rich could fight back with similar resources.
However, the Trump-critical coverage of The Washington Post, and Bezos’s counterattack on The Enquirer, shouldn’t buy Bezos a “Get Out of Jail Free Card” for the unjust ways he accumulates his dynastic wealth.
Bezos is reportedly the world’s richest man, with a fortune of $135-$150 billion dollars. Like other members the ultra-elite, Bezos strives to enrich himself, protect his wealth, and avoid taxes. He and his peers mostly ignore that taxes are necessary to support vital government services like education, healthcare and infrastructure.
To be blunt, no person in the world deserves to keep close to $150 billion in personal wealth when billions of other people live on less than $2 a day and have little or no access to things like education, health care, sanitation, or even clean water and food.
Amazon has a long history of manipulating governments to secure favors that give it an undeserved competitive advantage—extracting public money for its own enrichment, and finding ways around tax obligations—starting with the very origins of the company in the mid-1990s.
Fortune reports that Bezos originally located Amazon’s head offices in Washington state, rather than California’s more tech-talented Silicon Valley, to dodge sales taxes in California and other states. Bezos even admitted to considering locating the office on an Indian reservation near San Francisco to have access to Bay-area talent without collecting sales taxes.
For the next two decades of Amazon’s remarkable growth, it collected sales taxes almost nowhere, giving it an unfair competitive advantage over brick-and-mortar stores that had to charge sales tax, helping to put thousands of competitors out of business and cementing Amazon's monopoly status. Today almost 50% of every dollar Americans spend online is now captured by Amazon.
As Amazon started to locate warehouses and other facilities in more states to hasten delivery dates, it had to start collecting local sales taxes. To maintain Amazon’s monopoly advantage, Bezos came up with a new strategy. With cities desperate for jobs, Amazon required them to bid to offer the biggest tax breaks and government subsidies to get a facility.
According to Good Jobs First, current subsidies to Amazon for locating facilities exceed $1.6 billion. And who’s going to pay for the roads to bring Amazon employees to work, schools to educate their children, and all the other government services necessary to operate a business?
Bezos and his shareholders feel they are entitled to enrich themselves while taxpayers pick up the tab.
And that doesn’t include the year-long auction to locate Amazon’s new headquarters, which New York and Northern Virginia “won” with $4.6 billion in tax-payer funded subsidies. With popular resistance now threatening the size of these subsidies—which will help put more local companies out of business—Amazon is threatening to go elsewhere.
When Seattle proposed a tax on large companies to fund affordable housing, Amazon halted new construction, and threatened to leave the city completely, upon which the city council repealed the tax within a month. Seattle Timescolumnist Danny Westnead compared Amazon’s tactics to “mobbed up” actions: “Nice economy you’ve got there, Seattle…Shame if something happened to it.”
In 2017 Amazon itself reported $5.6 billion in U.S. profits, and didn’t pay a nickel of federal income tax. Moreover, by using accounting tricks to defer taxes to future years, those Amazon profits will be taxed at the 21% rate post Trump’s corporate tax cut, instead of the 35% they would previously be charged, giving Amazon an additional $789 million windfall.
In the meantime, many employees of Amazon and its contractors are paid so little that they must rely on Food Stamps, Medicaid, and government housing subsidies to make ends meet. While pocketing $150 billion, Bezos can’t even pay many of his workers a living wage without taxpayer-funded subsidies.
Bezos gets away with such monopolist tactics because the enforcement of antitrust laws has drastically declined. Have you seen Bezos and his army of lobbyists advocating for stronger, instead of weaker, antitrust enforcement or opposing the GOP's $1.5 trillion in corporate tax cuts, which further enriched Bezos, leaving too little money for important government services like healthcare, education, and infrastructure?
I don’t think so.
But when it comes to economic and social policy which has enriched a tiny elite while the incomes of most Americans stagnate for decades, Bezos is no better than the other oligarchs liberals hate like the Koch Brothers and Sheldon Adelson.
The Bezos-owned Washington Post may print truth that hurts Trump in the short-run. But the huge economic inequality and stagnating incomes caused by policies lobbied for by Bezos and his oligarchic cronies are likely to feed right-wing populism and lead to more Trump-like demagogues in America and around the world, even if Trump is defeated in 2020.
It’s nice to see Bezos stand up to Pecker, but he’s still a greedy di*k whose monopolist practices make him astonishingly rich while undermining average workers’ wages and the health of the economy as a whole.