About Amazon

I’m letting my fiscal conservative side reign on this post and talk about all the stuff going on with Amazon. I will declare that I am a frequent buyer from this company, I suspect that over half my discretionary money goes to them. I love the idea of going online to see a volume of choices that dwarfs what I see when I take that one hour round trip drive to get something locally. All I have to do is punch a few keys and what I want magically appears on my doorstep within two days, and often even the next day, and they don’t try to stick on a hidden “shipping and handling fee that so many other online retailer do.

There is a lot of talk about unionizing the workers at Amazon. The biggest complaint seems to be that some workers think they have to work too hard. Amazon announces up front to all potential employees that yes, they expect you to work for their above average wages. The Alabama plant that they are trying to unionized pays their starting workers about $15/hour whereas most other Alabama employers pay at least 30% less.

I really don’t know if unions are much different in the last few decades but when I was going to college I worked the summers at a local manufacturing facility that was unionized. I paid 5% of my wages to Jimmy Hoffa to get what amounted to below average wages. In my last summer there I just got bored with the slow pace that the union had set for how many parts I was supposed to do in one hour. So, I did as many as I could comfortably do. It ended up I did 300% of the union number for a couple of days. I soon heard from a union rep that I was destroying the job for those who worked there full time. The next year when I applied for summer work I was told that there were no jobs available. I learned later that it was the union that said I couldn’t be hired. I wonder how much of that goes on today?

Getting back to the Amazon focus, I kinda think that my story melds into their situation. The company says “yes, you get better pay, but you have to earn it with better work”.

Another attack on Amazon is from Congress trying to break them up. They are too big they proclaim. But I think they are big because they provide a superior product that more and more people are using. They should not be broken up because they are providing a service that is above anyone else in that field. I know that local businesses are being hurt by the bigness of Amazon, much the same way as when Walmart came to town thirty-some years ago, but that is just a fact of life of an evolving marketplace.

2 comments

  1. “I know that local businesses are being hurt by the bigness of Amazon, much the same way as when Walmart came to town thirty-some years ago, but that is just a fact of life of an evolving marketplace.”
    RJ, Walmart is a prime example of a mega business taking advantage of its size and economic power. Walmart was a prime driver of manufacturing being sent to China. To get their products into Walmart companies had to open their books and show their total costs and profits. When it was seen that their production was not in China they were told either move or forget getting on our shelves. Costs and profits were controlled by Walmart. Walmart also has a long history of pay low enough to put many employees on government assistance. You and I pay for that. As you state they also drove many small businesses out of business. Opening too many stores in a rural area was a common practice. This was used to drive all the other stores out of business. Then the extra stores were closed and perhaps you had to drive 30 miles to get to the only Walmart left. These closed Walmart’s were called “dark stores”. They refused to rent them out to other retailers. Some smart communities banned the opening of a local Walmart due to their predatory practices.
    Amazon’s ability to pay almost no income taxes means we are subsidizing their expansion into every area of commerce. I am sure when they dominate all of retail they will not take advantage of their unassailable position. I have noticed a number of stories where they have used their inside knowledge of vendors on their site to start an Amazon competitor and then run the original vendor out.
    It is interesting that the main article you listed as a source for the series on Sweden said that there is no minimum wage. That is because unions have negotiated higher wages. An example given was a McDonald’s cashier was paid $15hr. Unions played a very large part in building the American middle class. Sweden apparently encourages higher prices on consumer goods in order to support their middle class incomes. Perhaps this is an important lesson in why pursuing the absolute lowest prices for consumers & highest profits for corporations can lead to a death spiral in a society. The corporations are playing us against our fellow citizens. The continued and growing wealth disparity in the USA is a consequence of this single minded push. I would further suggest that wealth disparity was also a significant factor in the rise of Donald Trump.

    Like

  2. Thanks for the thoughts Fred, even though I don’t necessarily agree with most of them. I am saying that Amazon is number one for me because of convenience not price. It’s being able to select from hundreds of choices instead of just a few. Why would Amazon be paying well above local wages in Alabama if they were trying to stick it to their workers. They pay well above wages for the area and even provide healthcare and vacations that most of the competitors don’t. That doesn’t sound so bad to me. It will be interesting to see where this union votes goes later this week.

    I’m just saying that unions as I have known them treat the employers as the enemy instead of cooperating for the greater good as the Swedish versions do. What’s good for the company is not necessarily bad for the workers. Congress, as a matter of course, designs tax laws to encourage companies to reinvest in the American economy and to provide employment in disadvantaged areas. Of course Amazon takes them up on both those issues. They have provided millions of jobs and built a massive infrastructure throughout the US.

    I do agree that all income should be taxed at basically the same rate, but I can’t blame Amazon for taking advantage of what local and federal agencies dangle in front of its face. Just because they have become big doesn’t necessarily mean they are bad, it could just as easily mean they are giving their customers what they want.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s