Matt Stoller: Why We Need to Break Up Amazon – and How to Do It

Yves here. The main way that those of the left-leaning persuasion see Amazon as a bad guy is for its treatment of warehouse workers, who work in physically-taxing conditions and are paid what is barely a living wage for a single person.

As Matt Stoller describes in this piece, Amazon’s ambitions are monopolistic, and they’ve already gone a long way towards achieving that ambition in a large number of markets. They regularly engage in predatory pricing to crush competitors and gain market share. Their dominant position then allows them to chose how to extract more profit, which is usually a combination of squeezing suppliers and raising prices.

Antitrust has become close to a dead letter in the US. Amazon makes for a worthy object for reviving it.

By Matt Stoller, who writes for Salon and has contributed to Politico, Alternet, Salon, The Nation and Reuters. You can reach him at stoller (at) or follow him on Twitter at @matthewstoller. Originally published at Medium

“Before we speak ill of Amazon, let us kneel down before it.” says Franklin Foer at The New Republic. This creature, he goes on to argue, set the goal of building a bookstore as dramatic in scope as the Library of Alexandria; such a goal seems ‘puny’ compared to what Amazon today actually is, a technological and logistical marvel that can deliver books to your phone in the time it takes to yawn. There’s a bit of a rebellion against this behemoth among the chattering classes, with George Packer of the New Yorker in February of this year warning that the company is destroying our ability to write books, enclosing our cultural commons into its own private fiefdom.

I decided to read Amazon’s 10k, the company’s 2014 annual report to the Securities and Exchange Commission, to see what I could understand from how that company describes itself. What I found is as Foer commands: bow down to this marvel. “We seek to be Earth’s most customer-centric company,” it says, under the general description of its business. “In each of our two geographic segments, we serve our primary customer sets, consisting of consumers, sellers, enterprises, and content creators. In addition, we provide services, such as advertising services and co-branded credit card agreements.” That’s it. That’s the company’s business. No mention of books, which is what the company first started selling. Or DVDs, electronics, or even shopping. They aren’t a bookstore, or a even a store at all. Because Jeff Bezos isn’t building a store. He is building a global spanning trading empire.

And who does Amazon compete with? Telecommunications, banking, retail, web infrastructure, media, advertising, publishing, computing services, consumer electronics… It might be easier to list which markets Amazon is not trying to take over. According to Amazon, it competes with “physical-world retailers, publishers, vendors, distributors, manufacturers, and producers of our products, other online e-commerce and mobile e-commerce sites, including sites that sell or distribute digital content, media companies, web portals, comparison shopping websites, and web search engines, either directly or in collaboration with other retailers, companies that provide e-commerce services, including website development, fulfillment, customer service, and payment processing, companies that provide information storage or computing services or products, including infrastructure and other web services, companies that design, manufacture, market, or sell consumer electronics, telecommunication, and electronic devices.” Well it doesn’t drill oil. Yet.

In addition, while net income is low, and while it is not even seeking to generate profits at this point, Amazon is still a very profitable enterprise. But this is hidden because Bezos, according to this 10K, is focused on free cash flow, and that isn’t counted as earnings. So you can technically say ‘Amazon doesn’t make money,’ but there’s a reason it has a $100B+ market capitalization. Bezos also seeks to increase the value of the company itself through aggressive expansion. Every year, Amazon’s net assets increase, because it is building more warehouses, software, data centers, and so on and so forth. Its cash hoard went up by $3 billion last year because it generates a lot of cash (roughly two to two and a half billion dollars a year). The best part of focusing on free cash flow is that Amazon doesn’t have to pay income taxes on it.

One particular nugget in this investment report shows just how powerful Bezos really is. This report says, “On average, our high inventory velocity means we generally collect from consumers before our payments to suppliers come due.”

Amazon is so powerful that it collects money on the stuff you buy before it has to pay its suppliers for the stuff. In its retail business, it requires negative working capital. To put it another way, if you are a supplier to Amazon, you not only sell the company goods at cut-rate prices, but you are also effectively required to make Amazon a 0% loan that turns over as long as you have a relationship with the company. Amazon is a cannibal, running itself on the working capital of other, small companies.

To take just one more example, Amazon offers great shipping prices. You might think this is due to its efficiency, and its ability to invest in robotic warehousing facilities. That’s probably part of it. But Amazon also says that “we seek to mitigate costs of shipping over time in part through…negotiating better terms with our suppliers.” Its low prices are a result of its power over its suppliers, not just its logistical prowess.

It doesn’t just cannibalize small producers. As with all empires, Bezos preys on everyone he can.

Workers? Yup. “Beginning in August 2013, a number of complaints were filed alleging, among other things, that, Inc. and several of its subsidiaries failed to compensate hourly workers for time spent waiting in security lines and otherwise violated federal and state wage and hour statutes and common law.”

The U.S. government? Well it keeps $2.5 billion of cash in foreign jurisdictions, untaxed, and has taken advantage of a retroactive R&D tax credit.

Foreign governments? Yup. The French Tax Administration is investigating. “The notices propose additional French tax of approximately $250 million, including interest and penalties through the date of the assessment. We disagree with the proposed assessment and intend to contest it vigorously.” The company may be investigated for tax violations by China, Germany, India, Japan, Luxembourg, and the United Kingdom.

Entrepreneurs? Yup. It has 13 patent infringement lawsuits, pending including one by a quasi-government entity in Australia. In a well-understood traditional monopoly tactic that would make John D. Rockefeller proud, the company dropped its prices on diapers to destroy, and then bought the company for a song.

Its own shareholders? Yup. Amazon awards a lot of stock to employees to avoid using cash payouts, so its equity base is constantly expanding. That isn’t noticeable when the stock is going up, as it has been for years. But it’s hidden risk that is to be paid on a future date.

The economy? Yup. It’s quite clear that Amazon is a deflationary force, pushing down wages, prices, tax revenues, and new non-Amazon business activity. It has deflated prices in book publishing, and retailers across the board are terrified that Amazon is in the process of ripping their guts out. The company is having a ripple effect across the economy. To the extent that deflation is a serious problem, which it is, Amazon is a villain. And this isn’t just ‘technological process’, it’s straight up market power over workers, suppliers, and even governments.

The neighborhood and politics? Yup. Harvey Milk got his start in politics by opening up a camera store in the Castro neighborhood in San Francisco. From there he used his store as a base of political organizing, and became the first openly gay elected politician in American history. The lesson here for our politics is clear. Local retailers train political leaders, local retailers do things for the neighborhoods they are in that Amazon does not. If Amazon continues its growth, that era of democracy is over. Harvey Milk couldn’t open up a small camera retailer today. No more neighborhood store for you.

The one group that is treated with exceptional grace is consumers. They get low prices and great service. But this relationship is increasingly feudal, with low prices and great service as the benefits I get for surrendering my liberties to Jeff Bezos. I may get excellent prices on my Kindle, but I am now a renter of those books. I can’t lend them to my girlfriend any more, unless Amazon says I can. Amazon can take them away at any point. It knows every page I’ve read, everything I’ve highlighted, it knows what I might want to buy. It knows what I’ve watched on Amazon prime, where I’ve lived, what I buy on a regular basis, whether I’m price sensitive, an impulsive buyer, what I might be selling. Amazon knows, and at any point can exert power.

Ok, so now that the problem is fleshed out, what can we do about it? Fortunately, we have a long tradition of anti-monopoly law, though it hasn’t been used in decades. So let’s use those dusty old legal tools and break the company up into chunks small enough to control, and large enough to allow for the innovation that Amazon currently provides.

Here’s a first cut at what we could do with Amazon. Let’s take a look at the company’s lines of business.

Cloud services — Amazon is a cloud computing provider to lots of entities, such as Netflix, nonprofits, and the CIA. It even used to host Wikileaks. This entity should be spun this off, there are clear conflicts of interest with the rest of Amazon’s business. Amazon should not have the ability to peer directly into the commercial infrastructure of its competitors, or control the critical infrastructure of entities with which it competes directly, like Netflix. And it should not be able to cross-subsidize its cloud computing subsidiary with its retailing operation.

Publishing and Studios — Amazon owns a TV/movie studio, several publishing arms, IMDB, and Alexa internet monitoring. Spinning this off would be great, it would add an independent competitor to the movie/TV business, a publisher to the consolidated publishing industry, and these entities would have a different data-driven culture than the existing players. As part of this giant Amazon empire, they are subsumed into Bezos’s larger and murky ambitions. As an independent media entity, it would be a welcome entrant to an entire set of markets.

Advertising and Payments — These are markets which need more competition. Amazon is entering these spaces because it is going to leverage its customer data and scale to force its way in to these areas. There is no reason to allow this classic predatory behavior. Advertising and payments need more independent players, so spinning these off would be reasonable. It would also set a nice precedent to use to go after entities who are monopolizing the advertising and payments space. It’s not clear to me how to split customer data, but that data will degrade over time anyway.

Consumer Electronics (Kindle) — Amazon has built one successful product, the Kindle. This is a huge problem because it has a monopoly in the ebook market. I’m not sure if this should be spun-off into a separate entity, but it should be required to license its technology to anyone who wants it (like Xerox was in 1975, which led to low cost innovative photocopiers, and RCA was which led to low cost and better TVs). Anyone should be allowed to set up a Kindle store.

Online retail store— Amazon has 50% of the book market. That’s way too much. It has pricing power over its suppliers, and is now determining what gets published and by whom. Since the company already divides itself up regionally based on warehousing, break up the company into regional players a la Standard Oil break-up. Each new company would get customer dataand warehouses in one regional area, and then they would be free to compete with each other (though not merge). Warehouse technology would be put into a shared pool and required to be open to anyone who wants to license it. The government should also require the Robinson-Patman law to be enforced again, a law which gives power to set prices back to producers.

Third-party marketplace — Amazon’s marketplace should be spun-off into a separate company. Here the conflicts of interest are substantial, because right now Amazon can see which products from third party producers are popular and then just decide to stock them itself. In other words, having its third-party marketplace and its retail division combined gives Amazon an unfair information advantage over its third-party entities.

So that’s one plan. It’s a bold plan, for sure. And it requires a significant departure from the current thinking in our political order.

It’s important to take these monopolies on in the context in which they were born. Amazon is not Standard Oil or AT&T, it was born out of a legal environment established in the 1970s in which fear of inflation was paramount, and consumer rights were a driver of our political conversation. So the company is deflationary in its model and prioritizes the interests of consumers to the ruthless exclusion of the larger democratic culture around it. This plan would take apart the underpinnings of Amazon’s power, and force it to compete on an open playing field. It would set precedents for other antitrust suits in the payments, advertising, and retailing arena, and unleash enormous amounts of innovation both within the new Amazon subsidiaries themselves and with retailers and producers as they saw a much more open and freer ecosystem of commerce.

The problem with Amazon is not fundamentally one of economics. I mean, yes, it’s destroying wealth, but this is a symptom of the real issue. Amazon is a cannibal. It eats other companies in ways large and small, it eats the time of its workers, and it eats our government through tax avoidance, all to create a cash generating machine. It sucks in investment in as much of the economy to serve its ends, much as Walmart did in the 1990s (a substantial amount of American productivity basically boiled down to Walmart getting more efficient). Amazon is a tyrant, it rules through terror, and left unencumbered, it will destroy swaths of the U.S. economy. Arguments for Amazon as pro-consumer essentially boil down to ‘well its use of economic terror is efficient’. And the British East India Trading company sold really cheap tea in 1775. Our culture is about more than having a trading company run by a tyrant smoothly delivering goods to us for low prices. It is about our rights as Americans to not be oppressed, whether that oppression comes in the form of a government or in the form of a private monopolistic corporation.

The final point is about how Amazon is not operating in a market system, but is attempting to replace that market system with rule by one man. This is noted right in Amazon’s 10k, and it’s listed in the company’s risk factors. “We depend on our senior management and other key personnel, particularly Jeffrey P. Bezos, our President, CEO, and Chairman,” says the report, bloodlessly. Amazon, trading giant, is run, well rather, ruled by one enormously intelligent person. This man, Jeff Bezos, can pick and choose which products to sell, which systems to run, and how goods and services will be managed across the economy. He is, by all accounts, an extraordinarily bright business operator, and a monomaniacally focused control freak with enormous discipline and ability. Yet, however bright he might be, the problem boils down to what Foer quoted from Louis Brandeis, “If the Lord had intended things to be big, he would have made man bigger — in brains and character.” Bezos simply is not capable, nor is one entity, capable of managing so much of our culture. It’s too big.

Open markets serve as signaling mechanisms, transmitting information across the economy so firms and individuals can adjust themselves to surpluses and deficits of goods, material, people, and money. By internalizing this entire organism through raw power, Amazon is essentially trying to replace our open markets with a planned economy organized by one man. As good a planner as Jeff Bezos might be, Soviet-style bureaucratic structures do not in the long-run deliver anything but catastrophe. They can produce a burst of growth up front, as Amazon is doing now and as the U.S.S.R. did in the 1950s, but they fall apart as their internal dynamics reveal themselves unable to meet human needs. The anti-monopoly movement has always stood against the forces of concentration, for precisely this reason. Power is not only corrupting, it is self-destructive. Breaking Amazon’s power, and returning to free enterprise, is the only path that will restore our property rights and our liberties.

This plan, or a plan that constrains or restructures Amazon in a real way, isn’t impossible, it just requires a change in how imagine ourselves. We need leaders who believe that public power needs to be applied for public ends, and this includes the management of our corporate structures and important public forums like open markets. This isn’t as radical as it may first seem, in fact this kind of thinking was the norm prior to 1978 or so. We’ve only forgotten. But we can remember. We can do something about this problem. Whether it was the British in 1776, the southern oligarchs in 1860, or banking predators in 1933, we have a history of standing up for our rights in the face of tyranny. And today that face may come in the guise of a smiling Jeff Bezos offering us low prices. But that face looks suspiciously like King George telling us to be good little colonists and drink our cheap tea.

(I’d like to thank Barry Lynn of the New America Foundation for helping me understand these ideas. Read his books, Cornered: The New Monopoly Capitalism and the Economics of Destruction and End of the Line: The Rise and Coming Fall of the Global Corporation. And yes, those are links to Amazon.)

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  1. John

    Equally to blame are all those soothsaying economist who preach the ethos of low cost capitalism. They are the first to preach low cost is good for you — no matter the social costs. Actually, these same folks never talk about long term costs of capitalism. They see low cost as a form of elixir — foaming the road — for the person who can build a better mousetrap — so they can themselves build their own careers — kinda like a symbiotic relationship.

    What is urgently needed are better economists who actually live on Main Street and not dining at the trough of monied interest groups and entities. Amazon is just one sympton among others that were spawned by those who preach ‘low cost’ and ‘let the market decide.’

    1. diptherio

      +1. Here’s my take:

      If you ever happen to find yourself on the campus of Montana Tech, in Butte, and your eyes happen to wander to the east, your gaze will be greeted by a stunning scenic display. Historic gallows frames from the old mining days dot the foreground, while the hillside behind them appears as artistic horizontal bands of orange, red, yellow, and brown. I know an artist who made that hillside the subject of a rather pretty series of oil paintings.

      That hillside, of course, is the Berkeley Pit: America’s biggest superfund site and once known as “the richest hill on earth.” Those beautiful bands of color are the end result of environmental pillaging on an almost unimaginable scale; the lovely hues that paint the terraced hillside come from over a century of mining waste and pollution. The richest hill on earth has become its foulest pit, but from a distance it looks sorta pretty. If you get a little closer, down inside of it, say, the view isn’t nearly so pleasant.

      This is by way of making a point about perspective, description and knowledge. The perspective from which one views the world has necessary consequences on one’s description of the world. One’s description of the world dictates which facts about the world one can become aware of, and which facts one cannot (because they fall outside of one’s description). Any economist necessarily views the economy from a particular perch within the economic system which s/he is describing. The location of this perch is an over-determining factor in the economist’s economic thinking and outlook. It largely determines which phenomena they see as problematic and which as salutary, which problems they consider relatively minor, to be safely ignored, and which need immediate addressing.

      Which is why Harry Braverman is one of my heroes.

  2. amateur socialist

    I stopped using Amazon years ago over their refusal to collect and remit sales taxes to local governments. I relented a bit after they finally started collecting them (but found that they were often not that much cheaper once you had to pay the taxes).

    I will miss the convenience but can’t afford the deflation or the worker abuse any longer. Goodbye Amazon!

    1. trish

      I feel rather a hypocrite for using them this long. I could buy books I coveted, often hard to find ones… in a bookstore often cost more than twice as much (if they had them or could order), and on my measly earnings that’s a big deal. And oh the ease…but enough.

      Sending this on to anyone I know who uses amazon.

      good post by Stoller. thank you.

      1. MikeNY

        Ugh, yeah. I love — LOVE — the used book marketplace… you can find practically anything there. I buy next to nothing from Amazon itself. How guilty am I of abetting the crime?

        1. nycTerrierist

          Same here. I try to shun Amazon and use when possible,
          but the cheap, htf books keep me coming back…

      1. lyman alpha blob

        Or better yet, drop by when you’re in Portland OR – you could spend days browsing the shelves at Powell’s, it really is a tremendous brick and mortar store too.

        I like Amazon for their wishlist. I put everything that I run across and want to read on the list so I don’t forget – then I go order it from my local bookstore!

        1. Jess

          Powell’s may be better than Amazon, esp. since it has a traditional store, but not by much. It has outsourced a lot of its back room stuff to India and embarked on a campaign of finding excuses to fire long-time workers, esp. those over 50. After working there for over 20 years my cousin recently fell victim, although he did win an unfair termination action in front of State Labor Commissioner. But all that got him was an improved severance package and he qualified for unemployment benefits (which are now about to expire).

  3. cnchal

    I heard a rumor. Amazon will pay warehouse workers an extra buck an hour if they can skate and bring their own roller blades.

  4. Kao

    Where your argument fails IMHO is that you ignore the fact that while Amazon has acquired technology by merging with (buying out) other companies, and of course has expanded its general reach through other non-tech bearing acquisitions, for example IMDB. Unlike say Google, Amazon has never acquired a company that would fall even near the realm of the Sherman Act and antitrust regulation can’t logically (or legally IMO, although I’m no lawyer) be applied to: A) a company just for being successful, or B) a merger because the acquiring company is successful and/or has a history of success and may at some time in the future grow the acquired company to the point where it would become anti-competitive.

    It seems to me that a lot of this argument rests on the idea that Amazon, and not for nothing, Google, Apple, and a number of other companies, are somehow inherently in the wrong and should be subject to what can only be called retaliation (although I’m sure the author would defend it as protecting the market) for being wildly successful and achieving what companies strive for, which is to beat their competitors as well as to gain market share and profits.

    1. jrs

      There are seldom talked about reasons WHY Amazon is successful as well, such as the fact that people rely on them not to have their credit or debit cards hacked when buying online. Now Powell’s may be fine, I don’t mean to imply otherwise, but at this point in time people don’t just buy books at Amazon. They buy a lot of other stuff through it as well. Lots of smaller retailers selling stuff online can not be trusted to protect one’s finances from hacking (some do, some don’t), but if one goes through Amazon to buy from these retailers, I don’t think Amazon has yet been hacked. Paypal also plays this role. Identity theft? Whose interest does it ultimately serve? Amazon’s for sure.

    2. Yves Smith Post author

      Anti-compeititive pricing is also a Sherman Act violation.

      And look how Microsoft and Visa/MasterCard lost anti-trust cases. For both, it was behavior-based, not based on acquisitions.

      It’s that they price below costs to kill competitors. Then they use the market share they’ve gained to either to raise prices or in Amazon’s case, to squeeze suppliers, the publishers.

  5. Chris in Paris

    The chances for any legal action against Amazon are much better in the EU where we still have people on the Competition Commission who take their jobs seriously.

  6. Peppsi

    It would be nice to have a plugin that deleted amazon from search results, so that you could avoid their ubiquity.

    1. hunkerdown

      You need only a few keystrokes appended to your search query to exclude the site from your results: Works on Google, probably works on others.

  7. RW Tucker

    I recently self published a series on Kindle Direct Publishing (link). While I’m convinced they’re the great evil monopoly, and as a rule I don’t order from them unless there’s no other option, no other ebook vendor out there made it as easy as they did. Distribution on Smashwords (DRM free, links to B&N, Apple, Kobo) was a nightmare. Even Google Play made it difficult.

    Perhaps Amazon bought out all their competition in the ebook market, or perhaps they’re just better than everyone else.

  8. Carolinian

    I can’t really disagree with any of this although the bit about Harvey Milk and small retailers driving social change is a bit much. The plural of anecdote is not data.

    Some kerfuffle here yesterday over Walmart, but while Walmart is just a gigantic version of a form of retail that has always existed (predecessor Kmart came from Kressges dime store, short lived Woolco came from Woolworths), Amazon really is different and Bezos is a megalomaniac. And while Amazon is an expert at the business of running an online shopping site they show the weakness of a large company trying to be the “everything store.” The Kindle, for example, is in many ways a poorly designed piece of equipment that could use much improvement as an e-reader. Their original shows for streaming are lackluster and getting little buzz.. Amazon is a company that cries out for a breakup even though waiting for the government to do so is probably fruitless. Still, given the on the edge business model and Bezos’ frequent forays into wacky diversions, it may just collapse from its own weight.

    1. Chauncey Gardiner

      Agree with your observation, Carolinian: … “Still, given the on the edge business model and Bezos’ frequent forays into wacky diversions, it may just collapse from its own weight.”

      IMO it may not even require that the Wall Street and USG agencies’ legs of the enabling stool meaningfully reduce their support.

      I would only add that perhaps Alibaba received over $21 billion in IPO funding in September in part as an anticipatory preemptive measure to forestall the outcome Matt is suggesting here, although I believe both entities are vulnerable for the reasons you identified.

  9. diptherio

    I’ve noticed a lot of content creators, podcasters especially, shilling for Amazon on their shows. Everybody needs to pay the bills, of course, but there has got to be a better way. Jimmy Dore is the most egregious example, since by all rights, abuses by Amazon are something he would normally be eviscerating in his typically entertaining fashion. However, I tried to broach the subject of Amazon maybe not being the best sponsor for a show like his on Twitter, and while he did respond to my tweets (which was unexpected), he was defensive in the extreme. He actually made the argument that he had once worked in a warehouse, so he knew what it was like, and how dare I…, etc. Obviously a touchy subject with him. Somebody else, please send him a link to this article. I’d do it, but he already thinks I’m an @$$hole.

    I’d like to see pressure on every progressive who’s sponsored by Amazon to drop their agreements with the company and demand some reforms before accepting them again as sponsors. We can’t afford to let our team-mates slide on this just because they’re short of cash. Jimmy Dore’s silence about Amazon’s abuses has already been purchased (he probably doesn’t see it that way), we need to try to stop them from purchasing even more silence and self-censorship. We’re going to need all hands on deck, if we want to change how Amazon operates.

    1. Carla

      It would be nice if Stoller had chosen to start the ball rolling by linking to something other than Amazon in his piece, but alas…

    2. jimmy dore

      Hey Thanks for mentioning my name and saying that I have been “bought”. I was told someone was taking pot shots at me over here so I thought I’d show up and respond.

      First: Every show I listen to, including BEST OF THE LEFT uses an amazon link to help support their show, but its only me that has been bought? okay, got it.

      Second: I am not an economist, so I can not speak to how to stop the train of globalization and online buying that so many here fear. But I will comment on the warehouse argument.

      I am a guy who worked plenty of blue collar jobs, including brick laying and warehouse work. My remedy for amazon’s warehouse workers is the same as WallMarts workers and McDonalds workers- unionize! And I will gladly publicly support any effort to do so. I don’t think the answer is to NOT eat at restaurants or stores that employ minimum wage workers, do you? Or is the answer to help those workers organize and get a living wage?

      You sent me a link to a story about how hard the work is at an Amazon warehouse. Yes, the work at an amazon warehouse is hard and repetitive. Like lots of jobs, including lots of jobs I’ve had. I worked a Warehouse and it was back breaking hard work and it was often freezing in the winter, and boiling hot in the summer. Its warehouse work. Its really shitty and hard. My point was that Amazon’s warehouse work sounded about the same or a little easier that the work I’ve done in warehouses and on top of buildings in 100+ degree heat and sub zero temperatures. Manual labor jobs are hard, and and Amazon warehouse job sounds pretty run of the mill back breaking work that blue collar people do all the time. My remedy for the warehouse workers is to unionize.

      Globalization of economies and the problems its brings seem very complicated to me. But I wonder if the author of this article wrote this article on a computer made my people in a third world country, or if he owns an iPhone or mac computer, or wears NIke’s or clothes of any kind or put gas in your car or use transportation that uses gas? Does the author agree with the business practices of those companies? Cuz they are all pretty horrible.

      Does the author watch television or listen to the radio? Cuz there are only 6 guys controlling all the media in AMerica right now and the opposite of a free market.

      It seems power and economic might has been consolidated everywhere from Amazon to Energy to Electronics to Media and so on. I’m all for a Teddy Roosevelt coming in and breaking up the monopolies, including Amazon if that will work and achiever a better economy.
      I’m a committed progressive who has worked my adult life for progressive ideals, and have taken the less lucrative path in entertainment became of my beliefs and sacrificed money because of my progressive principles my entire career. .

      Thanks again for the public smear, nice job on that, really helps out the cause. Maybe you can go after Ralph Nader or Phil Donohue next.

  10. Howard Beale IV

    Methinks instead of calling Amazon a monopoly a better term would be a monopsony-especially when it comes to books.

    1. diptherio

      They exert both kinds of power, very much like Walmart. The insidious aspect is that “it’s all in service of the customer.” Producers and competitors feel the sting of their monopsony/monopoly power, but their customers remain blissfully unaware.

  11. Carla

    For those who would like a less predatory source for online books, try Better World Books:

    Wikipedia: “Better World Books is an online for-profit bookseller founded in 2002 by Christopher “Kreece” Fuchs, Xavier Helgesen and Jeff Kurtzman.[1] It is a B Labs-certified B corporation (not to be confused with a benefit corporation), which donates books or a percentage of its profit to literacy programs around the world. [2] By 2013, the company has donated an estimated $14 million under this program.[1]”

    Although they handle only books (no OTC drugs, DVDs or lingerie), they do pay local sales tax and do not charge for shipping.

    1. trish

      Just did a quick and successful search for some recent books I would love not available in my library system…thanks, looks like a good site!

      (I really like that they handle only books…)

      1. Carla

        Hey, trish, welcome to the Better World Books club! Swearing off Amazon has been utterly painless for me (of course, I’m not a big consumer of goods, so Walmart was never even an option).

  12. roadrider

    With the exception of gift cards for my nieces and nephews I don’t buy anything from Amazon. I have also turned down several opportunities to interview with them. I also don’t shop at WalMart.

  13. Brooklin Bridge

    The problem isn’t simply Amazon, it’s the net, it’s greed and it’s our business model of anything is good in the land of the exceptional as long as, big business. When that meets technology, or the net in this case, it’s a disaster waiting to be unchained from any physical restraints.

    If you eliminate Amazon, you’ll get another just like it presto. They are literally queued up like giant cargo planes circling around waiting to land in a truly antitrust free country. Buy from physical stores unless there is no other way to get what you need. If everyone did it, it would work wonders, but of course that won’t happen. For those willing to sacrifice convenience, the most that can be hoped for is to slow the process. Significant changes are simply too fundamental to undertake except over the long term. You have to change attitudes and beliefs that are really entrenched. We’re going to loose the postal system too. Then watch what it costs to send anything anywhere.

    I fell for Obama so I can’t really brag in any satisfying way about seeing the problems with the net and potential behemoths from the start. Even before the net, when we (my family) had almost nothing, I wouldn’t go near Walmarts. Better to starve up front than the way it’s turning out, but then I had had the good fortune to see how it worked in another country, France, where retail, particularly in rural areas but everywhere by comparison, was still handled by small mom and pop stores. Of course, we’ve pretty much slaughtered that way of life for them but it wasn’t that long ago they still had a vibrant people based system of commerce.

    Now they are almost exactly like us – exact same junk too. Oh well, at least we got Nutella (from Italy) out of the deal.

    1. Carolinian

      While I agree that it might be nice if America was like France thirty years ago (when I too was there), just when has that ever been true? The Frank Capra It’s a Wonderful Life world that people think Walmart destroyed is mostly just a fantasy. In the 40s they called it “Capracorn.” Telling that the French have embraced our way of doing business and were beginning to do so even back then. Nobody made them do it.

      Greed is part of human nature and therefore instead of gnashing about greed the thing to do is to build political support for laws that will contol it. In a world where gigantism is the rule then government is the solution, not the problem.

      But I agree with you about the web. People are intimidated by computers and reluctant to try new things. This tends to create virtual monopolies like Amazon, Facebook, Google.

      1. curlydan

        I agree that Amazon is a prime candidate to be broken up. I fear no one will attempt it until it’s too late (i.e. when the $#!+ hits the fan and we are mindless consumer blobs ala WALL-E). But with Google, MY GOD, they really need to be broken up. They are minting money, controlling 70%+ of the traffic to virtually every freakin’ website in the world with a ton of that traffic being paid search where the non-paid search link is literally a few inches down on the screen.

        1. John Zelnicker

          I always try to use the non-paid link below the ads in a Google search. I have no desire to add to their hoard of cash.

      2. Brooklin Bridge

        … instead of gnashing about greed the thing to do is to build political support for laws that will contol it.

        We already have laws that would control it if it weren’t so convenient to go along. They are called Anti Trust laws. Good luck with that. As to wishing for the non existent good old days, I would gladly settle for a relatively non exploitative system of any sort, including cutting edge, but particularly ones where the anti trust laws we already have are enforced or better yet where people are aware of why convenience should not trump rule of law, or civil liberties, or a working judicial system. So when they see something like Amazon or Google or the MERS database, they recognize the potential for train wrecks rather than blame the victims because that’s easier. Or when they see a company like Walmart, they know what they are giving up and what they are tacitly endorsing by going there.

        Size does matter when corporations get to be big enough to engage in monopolistic practices. That’s why the Anti Trust laws were invented in the first place. The problem has resurfaced only on a truly global scale made possible by technology and that is partly at least because we have been willing to accept the negatives for the sake of convenience just as we have been willing to give up civil liberties as well as the rule of law because it is more convenient to simply go along.

        I mentioned France in the 70’s not because I pine for the days, but rather – as I said – because it gave me a different perspective which many people around me simply don’t have today. They assume that technology must go hand in hand with international behemoths that crush all competition and have no need to operate within the confines of any laws.

        1. Carolinian

          And the political support for leaders who will enforce those laws–not Barack Obama. Speaking for myself I don’t believe in a moralistic approach to these matters. Companies like Walmart and Amazon exist simply because of the environment in which they exist. The left needs to spend less time complaining and get their act together politically. This doesn’t seem likely at the moment, but events may bring about a change.

      3. trish

        “Greed is part of human nature.”

        to a great degree, greed is rather a cultured feature, I think. Grown and propagated, rewarded and reinforced.

        1. hunkerdown

          Funny how people say the same thing about needing authority figures: that it’s “human nature”. No, it’s simply what’s worked so far in the context it has created, and has grown to subsume the whole context. Now it’s just an excuse for those who want to appear communitarian without *actually* hurting their secured privilege.

      4. jrs

        Some see railing about greed as a way to build support for political laws that will control it. It first has to be a thing that people want to exert such control over right?

  14. DJG

    Amazon is the Standard Oil of our times. But way back then, breaking up the trusts was understood to matter. Now, we participate in shoring up the Ponzi scheme. Amazon is an example of the lack of political will in our times. And a question: Has Amazon ever truly made a profit?

    1. Left in Wisconsin

      As Stoller says, they generate cash but not profits. And they plow that cash back into expansion.

    2. John Zelnicker

      Amazon has made little or no taxable income. This is very different from cash profit which is the free cash flow that Bezos emphasizes. Taxable income includes a number of non-cash deductions that can reduce the cash profit of the company that is subject to being taxed. The most prominent of these is the depreciation deduction. Acquiring or building assets such as warehouses, computer servers, etc., can produce large depreciation deductions to offset all net income subject to tax. Bezos and his accountants have been masterful at using this and other non-cash deductions and tax credits to reduce taxable income and taxes to zero while leaving huge amounts of free cash flow available to be spent.

  15. Left in Wisconsin

    Not too much to argue with here except the notion that it is cash accumulation that motivates Amazon. I think they are still focused on market share over cash (kind of like Toyota in the 80s), which makes it an even tougher problem.

    I don’t see any possibility of breaking them up. So, since we are in the land of fantasy, why not nationalize instead?

    1. Carla

      “I don’t see any possibility of breaking them up. So, since we are in the land of fantasy, why not nationalize instead?”

      There’s no point in nationalizing anything we don’t really NEED. We NEED healthcare; we NEED postal services, we NEED banks.

      Nobody on earth needs Amazon.

      There are plenty of alternatives, and every reader of this blog is capable of finding them.

  16. Brooklin Bridge

    You’d think it would be sex or something like that, but oh no; you can take all the books and all the speeches, all the religions and all the supposedly noble deeds that “distinguish” humans from their animal relatives and blow the whole puffed up episode of history out like a candle with one word; convenience.

  17. Banger

    First, let me say that my wife and I run a small speciality retail business which would probably do better if Amazon did not exist and we add value in other ways through personal interaction, advice and so on. However, I save a lot of time and money by using Amazon. I don’t have to spend, at minimum, an hour driving to a store, dealing with traffic, wandering around trying to find what I need standing in line at the register and then driving back home. Stop looking at it as “one man” and see it for what it is a beautifully fashioned system of moving goods from manufacturers to customers–so we should destroy that?

    Let’s look at your assumptions for a moment. You imagine a small-town America of stable communities and local shops supplied by small manufacturers in a more or less free-market. That world does not exist and there is no scenario that will bring it back. We need original and creative minds to exist in our system because it is now dominated by small-minded careerists who carve out little niches and do what they can to avoid innovation and competition–there is no real market-system in our society, not really. Look at the medical industry–dominated by a series of organizations that are mainly interested in huge profits and delivering as little service as they legally can and most other industries are dominated by organizations that do just that even the NGO community.

    All the things Stoller lists are examples of genius not perversion and the disadvantages can be met by using the same rational approach Bezos has made. First, establish clear and enforceable labor standards including eliminating curbs on unionization. Second, establish some kind of work/income guarantee for all citizens so they aren’t desperate and willing to work for peanuts in unsafe and inhumane working conditions. Problem solved! Amazon can efficiently deliver goods to me and you and we can work on our other issues using reason! Imagine that applied to foreign policy! Imagine it applied to power generation, distribution and conservation! None of those two things or anything I can think of in our society is being currently addressed using reason and what we know works. Look at education! It is run as if cognitive science, neuroscience and social science in general never existed–it is run as if we were living in the 19th century! We have a future to embrace and Amazon is one of the few indicators of what could happen if we used our brains instead of our prejudices and narrow-mindedeness. Suppressing innovation, as the left sometimes tends to do is, is no way to expand the agenda of the left which is to create a convivial society for all not just the few.

    1. RUKidding

      I agree, at least in part, with what you say.

      I duly recall my mother (RIP) lamenting WalMart (but prior to that, other large grocery chains) and how it drove out mom & pop businesses. My mother’s family were small town butchers and grocers, who provided such good quality and service that customers came from long distances to buy their products (many grown and made in their family farms). I remember those farms and stores and the food they created. Very nice.

      Oddly enough, my mom was a very reflexive (and very uninformed) R-Team supporter. When I attempted to explain to her how the GOP not only supported but encouraged the Walmart-ization of America, she pretty much just tuned me out. But she refused to shop in such stores and only reluctantly shopped in grocery chain stores bc there were few to no other choices.

      Back in the day, I believe that WalMart employees (not yet called associates) actually made an OK wage for the times, plus I know for a fact that full-time employees, including the old school “greeters” (do they even exist now?), got benefits. Nowadays? WalMart is a pretty terrible place to work, and many stores now seem poorly run. One can argue that this is just the “natural course” of things or whatever. I’m an economics dummy. Seems to me, though, that another piece of the puzzle is the extreme rent-seeking at the top with the WalMart egg & sperm lottery winners. MOAR for me, almost NONE for you, you lousy scum dogs seems to be rally cry.

      My observation is that the 1%, including Walton heirs (who produced nothing) & Jeff Bezos (who did produce something), are constantly rent-seeking on steroids, seeking to wring every last drop of blood out of their hapless employees, whilst collecting huge profits or whatever you want to call it. ALL for ME, none for you, suckers.

      I don’t begrudge Bezos for what he’s created, and in fact, I do actually find it pretty laudatory (somewhat). The issue gets back to how Bezos is accomplishing his empire through really draconian wage-slave conditions for workers and via various kinds of tax cuts, tax dodges, tax incentives and who knows what else. I wouldn’t begrudge it, except these robber barons never ever distribute the wealth evenly and fairly, do they? Bezos could still do everything he’s accomplished with more to come, live like a frickin’ KING, but also pay his workers better and pay his fair share in taxes.

      I know I’m being simplistic, but let’s get real here. Yesterday’s commentary about WalMart falls in the same category. Walton heirs lucked out by being born to Sam Walton. Good for them, but their whining complaints about “working so hard” (gimme a break) and deserving every last penny they can wring from their workers’ backs falls on my deaf ears.

      Look at Costco: it’s my understanding that the workers there are paid better, get benefits, and yet the stores are doing well. Perhaps the former owner and the current CEOs pull down less than Bezos and the Waltons. They don’t seem to be hurting to me.

      There are sane business models out there that don’t have to result in worker abuses, pathetic wages, no benefits, work schedules that are unfair & suck, while playing games with taxes to avoid at all costs paying anything close to a fair share. These business can still be profitable (or whatever) and make it.

      But no! We’re fed a line of goods, imo, that the ONLY way the Waltons can make WalMart “work” is to engage in their draconian rip off practices, and ditto for Bezos. For me, that’s the piece that often is not really addressed in the rush to say that profits can ONLY be made if workers are ripped off and taxes aren’t paid. I don’t buy it.

      1. Carolinian

        If you have a problem with the Walton heirs–and who doesn’t?–then the answer is a return to the estate tax of yore. Or perhaps a simple return to the tax rates of yore. The top rate–rarely paid– was once 90 percent.

        If you have a problem with Walmart’s excess profits then an answer is a rise in the corporate tax. This could help pay for that needed government run healthcare. The low taxation these corporate behemoths enjoy is their true corporate welfare. The notion that they are under some obligation to provide health care is really the opposite of what liberals should be for….perpetuating a failed system.

        There were plenty of predatory stores before Walmart. In fact my father, briefly in the meat business himself, was bankrupted by one.

        And I’ve had my say about Costco but Costco’s business is not like Walmart’s business. Apples and oranges.

        1. RUKidding

          I’d be happy to see a return to something close to the tax rate of yore both on personal income, estate inheritances and corporations. When corporate taxes were higher, the corporations tended to put more money into R&D, and it seems to me, their products were better.

          Cutting taxes to the bone, and most of the time actually PAYING corporations to stay somewhere, has not resulted in “more jobs,” much less “better employee pay and benefits,” as has been touted for ever so long. That was always the “excuse” given for cutting, cutting, cutting corp. taxes, inheritance taxes, and personal income taxes. None of those cuts resulted in what was advertised: rising tide raising all boats. Not that I ever believed that lie, but just saying…

          Yes, I guess Costco & Walmart are apples to oranges. I’m not deeply versed in Costco, so I may just be “flapping my jaw.” I thought the employees were paid better and had benefits. I may be mistaken on that.

          1. optimader

            I’m not deeply versed in Costco, so I may just be “flapping my jaw.” I thought the employees were paid better and had benefits. I may be mistaken on that.

            they are, much to the frustration of WallSt. For someone w/ no education or skills perse, but willing to hustle, it’s a great place to start.

        2. Vatch

          I’m pretty sure that Costco’s business is very similar to Sam’s Club, and Sam’s Club is owned by Walmart. Are Sam’s Club employees treated better than Walmart employees? I don’t know, but I rather doubt it. Comparing Costco to Sam’s Club is comparing apples to apples.

          1. Yves Smith Post author

            Costco employees are most assuredly paid better than WalMart employees. Wall Street analysts regularly hector Costco to cut pay. They regard paying their employees better as integral to their model.

    2. Carolinian

      You make many good points and I do agree that Amazon isn’t all bad. But it’s hard to defend some of their practices like going to the mat over the sales tax. In the past Bezos would have his staff undergo amazing contortions to avoid any legal case for a “business presence” in a particular state. It’s quite arguable–I have this argument with my brother all the time–that Amazon exists because of the sales tax exemption. Indeed Dean Baker said so the other day. Seems their often wealthy customers like bargains-by-any-means just as much as poor people do.

      1. not_me

        Sales taxes are regressive since the non-rich consume a larger proportion of their income than the rich. And taxes that can be evaded are discriminatory against the law-abiding in favor of the tax evaders.

        So rather than try to tax sales over the Internet, we should instead eliminate sales taxes altogether.

    3. Brooklin Bridge

      Banger, most of the points I have made, you have made yourself in other comments on other threads, so go figure. Perhaps it’s just a cloudy day or something.

      1. Banger

        I didn’t see your comments when I read the article. I write in between things and don’t refresh often to see other comments. As for repeating ourselves–I agree–most of us do and I’m getting tired of it too. We are going around in circles–little ever comes out of internet discussions and I’ve been at it on and off for nearly twenty years. This is one of the better places but our “discussions” are seldom really real dialogues–we mainly want to be right and therefore never get to the core of anything. The format doesn’t work anyway and a significant number of people here don’t want to go the depths I believe would be more productive–still this is a good place to hang if nothing else is happening.

        The point here is that we get new readership here all the time and I feel these things need saying. I think my time here has about run out anyway so I may just STFU. I’ve got plenty of pressing creative projects I’ve parked on the side I need to get to. In large part I’ve been testing out some core ideas and I’ve found it useful to knock them around here. The other day I realized I had missed out at something really important. One of my favorite P.J. Harvey songs:

        “You Said Something”

        On a rooftop in Brooklyn
        One in the morning
        Watching the lights flash
        In Manhattan
        I see five bridges
        The empire state building
        And you said something
        That I’ve never forgotten

        We lean against railings
        Describing the colours
        And the smells of our homelands
        Acting like lovers
        How did we get here?
        To this point of living?
        I held my breath
        And you said something

        And I am doing nothing wrong
        Riding in your car
        Your radio playing
        We sing up to the eighth floor
        A rooftop, in Manhattan
        One in the morning
        When you said something
        That I’ve never forgotten
        When you said something

        1. optimader

          “I write in between things and don’t refresh often to see other comments…..but our “discussions” are seldom really real dialogues”

    4. jrs

      Another seldom talked about advantage of Amazon has to do with cr@*ification. More and more stuff is @#$, it gets harder and harder to find stuff that isn’t at any store. The internet is a great advantage in serving a NICHE MARKET, and the market for quality goods has become a niche market. Sad but true.

    5. H. Alexander Ivey


      “Stop looking at it as “one man” and see it for what it is a beautifully fashioned system of moving goods from manufacturers to customers–so we should destroy that?”

      Yes, ‘cos you are not looking at the entire picture. A human constructed system exists for humans, a group, not a single person, so right there your argument falls flat. I argue that there is no “truly” single person system, man is a social animal so everything he does is not only for himself, it is also for, or at least impacts, others. So he has a responsibility for that impact on others. Bezos has built a system based on lies, from day one. It was never about moving books better, it was never about being more efficient or doing anything for the greater good. It was and is a system of rent or money extraction from the others that system impact.

      Yes, you get a book (or whatever) from Amazon, cheaper and faster, than, a. in the good old days, b. your old mom and pop store, c. whatever mythic event you use. True, but what about the community you live in? What about the young, the old, and the middle age who don’t get social services ‘cos Amazon refuses to be a good member of society? Yeah, they get a cheap(er) book, but no community, no public services, no protection against predators. No man is an island, to paraphrase Donne, ask not for whom pays the cheap price, the full price is paid by you.

      What Bezos, Gates, the late Jobs, etc., are doing is NOT innovation, it is stealing. It is being done by removing government law and regulation from the “market place”. You are right to say we don’t have stable communities and small-town shops (I grew up in one and it ain’t so great, glad to see it go). But society hasn’t been that way for decades, you are raising a straw man – Adam Smith described the true “market” society 200 plus years ago and it faded not long after he finished his TheWealth of Nations. As Michael Goodwin in Economix stated, we don’t even live in an age of Big Business, which replaced the market economy. No one really can say what age we live in (Goodwin argues JK Galbraith’s The Affluent Society comes closes to outlining what business society we now live in). So, while these gentlemen may be smart, they are “geniuses” at evading and disregarding the rules, regulations, and laws of the city, county, state, and country they live and do business in. There is not much to admire there I would say.

      As for NC and Stoller, this post and his blogging are the first, not the middle, nor the last, stop in changing our present corrupt political and business system. First we – a minimum number of people in society, need information about the reality of our world. Then we need to identify each other and form groups of like minded men. Then we need to start putting on pressure, as a group, on our pol/bus system to make the system meet our wants, needs, and desires. And lastly, we, the groups, need to become part of the pol/bus system to ensure that our wants, needs, and desires are continued to be met – it is a never ending activity (struggle if you want to be pessimistic or cynical, I prefer activity, because it is life to join up with others to get what the individual wants).

      [this post really is a reply to the entire thread starting at Banger, October 17, 2014 at 10:27 am, so take as such. And second, as an old fogey, I use the “he/man” noun for all mankind, I refuse the he/she convention or saying “she/woman” for mankind.]

  18. Another Gordon

    It’s good to see that someone else remembers the Robinson-Patman Act. In simple terms this requires those supplying goods for resale to have a common trade price for all the retailers they supply irrespective of their size except insofar as actual fulfilment costs vary. So an order from a manufacturer in, say, Boston to Alaska can be charged at more than one to New York because of the extra transport but a supply to a tiny Mom & Pop store will get the same unit cost as one to Walmart next door.

    At present a retailer’s ability to compete is mainly down to size; bigger > buying power > lower procurement costs > fatter margins > squashed rivals > grow even bigger > buy political power > create oligarchy. With Robinson-Patman the playing field is levelled since retailers’ gross margins are exposed to competition while price is de-emphasised in favour of service and quality. If the likes of Amazon and Walmart really are good as they claim as opposed to just very big they will thrive under Robinson-Patman; if not they will be exposed.

    It’s surely no coincidence that one of Reagan’s first acts on becoming President was to direct the Commerce Department not to initiate any new actions under Robinson-Patman.

  19. Kim Kaufman

    Surprised no one has mentioned Bezos’ ownership of Washington Post.

    What I don’t understand is how Bezos, whose company generates cash not profits, still made himself into a multi-billionaire.

    Haven’t bought anything at Amazon since they refused service to Wikileaks in their time of need.

  20. nonactual

    Long time reader/lurker, first time commenting: I just want to quibble with one point of the piece. You CAN lend your kindle books to your girlfriend or to anybody. You can strip out Amazon’s DRM and give people books as you please by using Calibre (available at

    You can also load up ebooks from other sources to your kindle via the same piece of open source software. Hopefully someone will find this useful.

  21. Jim

    “This is one of the better places but our “discussions” are seldom really real dialogues–we mainly want to be right and therefore never get to the core of anything.”

    Banger, I couldn’t agree more with that sentiment and that critique of NC.

    Please stick around. The broad deterioration in our society is accelerating and as it escalates we need people like yourself who have the courage to try and get to the foundation of things.

  22. Jay M

    Amazon seems to be leveraging their receivables to at least in part finance the capital expansion involved in creating distribution centers, while being able to float stock to pay exorbitant salary to the uber managers.
    Is there better margin in handling physical commodities or by being an electronic intermediary? With our flaccid regulatory apparatus pruning Amazon seems as likely as Goldman Sachs ceasing god’s work.

  23. not_me

    How is breaking up Amazon going to help its employees? And if the employees are partly paid in common stock (and thus become co-owners of Amazon) then low wages in fiat is much less problematic. And we had a sane money system without the government-enabled boom-bust cycle then workers might be paid ENTIRELY in Amazon stock and do well since the stock price would then not be subject to bank-induced deflation.

    So once again, how is breaking up Amazon going to help its employees?

    1. Carla

      ARE Amazon employees paid partly in common stock? How many employees does Amazon have?

      I know personally of one former Amazon employee. He was treated and paid like a slave and certainly never given common stock in the company. Is this just an urban legend?

      1. not_me

        From the article above:

        “Its own shareholders? Yup. Amazon awards a lot of stock to employees to avoid using cash payouts, so its equity base is constantly expanding. That isn’t noticeable when the stock is going up, as it has been for years. But it’s hidden risk that is to be paid on a future date.”Matt Stoller

        So, according to Stoller, Amazon is using its own common stock as a form of private money and that’s way cool from a social equity (pun intended) as well as business perspective. That said, I’m only going on what Stoller says. As for his point that common stock is too volatile to be used as money, that is a result of the predominate private money system based on government-privileged debt creation rather than on equity.

  24. Tony Wikrent

    In the big brawl between Hamilton and Jefferson, the central contention revolved around the issue of how do you best ensure the development of a citizenry with republican (small “r”) values. The foundation of Jefferson’s opposition to Hamilton’s plans to promote manufactures (tis important to remember, by developing a system able to supply credit – which our financial system today no longer does – as well as a protective tariff and bounties and other outright support) was Jefferson’s belief that the sole repository of republican virtue was in the agriculturalists. Because the farming yeomanry were dependent on no one except the Good Lord and the sweat of their own brow, they could not (theoretically) be influenced or swayed by politicians lacking republican virtue. The problem, of course, is that you could not keep the economy mostly agricultural for any long period. Jefferson’s great failure was to try and figure out how you promote republican virtue in the rising masses of craftsmen, mechanics, tradesmen, and merchants, not to mention factory workers.

    Stoller’s argument that a Harvey Milk would not be able to open an independent camera store speaks directly to this historical controversy. What pool of entrepreneurship have we as a society frittered away by allowing a WalMart in each large town to replace a local grocer, a local clothier, a local hardware store, a local music shop, a local tool shop, a local tire shop, and so on?

    Though Hamilton was correct about the need to industrialize, his great failure was his rebuffing of the Jeffersonian warning that enabling and allowing financial speculation would create a raucous faction of greedy “stock jobbers” lacking any republican virtue at all, and therefore completely unfit for promoting the common good.

    It is difficult to explicate these ideas adequately in so abbreviated a venue, but I will close with the exhortation that a careful examination of these ideas of republicanism, as they were understood at the formation of our republic, will provide great insight into many of the problems we confront today. And I would be remiss not to also note that such examination will make it startlingly clear that most of what present day conservatives and libertarians believe about American economic history, is utter bunk.

    1. Tony Wikrent

      Umm, correction: Jefferson’s great failure was that he DID NOT TRY to figure out how you promote republican virtue in the rising masses of craftsmen, mechanics, tradesmen, and merchants, not to mention factory workers.

    2. proximity1

      “The problem, of course, is that you could not keep the economy mostly agricultural for any long period.”

      Interersting theory. However, the native tribes of north america had already demonstrated that this was false. They’d easily lived for more than a thousand years already (in North America) in what were entirely “agricultural” economies–and, had the invading European settlers not come and destroyed them, there’s no reason why they couldn’t have gone on living as they had for an indefinitely long time to come . What Jefferson and Hamilton–but only too late, the native tribes themselves–understood was that such an agrarian economy was not compatible with a rapacious and insatiable one which inherently sought to monetize and control via market forces all social phenomena of any grand importance. Understanding that, their programs presupposed the marginalization to the point of complete practical destruction the societies of native north american tribes.

  25. LocaltoOakland

    Another good alternative for used books is It shares catalogs from a massive number of world wide independant booksellers.

    1. Carla

      Yes, agreed! I have used ABEBOOKS and also alibris.

      I also patronize local independent bookstores whenever possible, and even have darkened the doors of Barnes&Noble.

      Pretty much anything but Amazon and WalMart.

      1. proximity1

        “ to acquire AbeBooks” [note the dateline: 2008]
        Posted on August 1, 2008 | By John Cook

        [ from the Seattle Post Intelligencer / Link : announced today that it is acquiring AbeBooks, a 13-year-old Victoria, B.C., online retailer of used, rare and out-of-print books.

        Terms weren’t disclosed, but AbeBooks will continue to operate its Web sites from Victoria. It employs more than 120 people and offers more than 110 million book titles, according to the Web site. It also has relationships with more than 13,000 booksellers.

        The acquisition is interesting in part because AbeBooks’ Web site — launched in 1996 — arrived on the scene around the same time as Amazon. (Amazon was founded in 1994 and launched a year later.)

        The other interesting component is that AbeBooks is a part owner in LibraryThing, the social networking site for book lovers. already is an investor in Shelfari, the Seattle startup that competes directly with LibraryThing.

        What does this mean for Shelfari?

        Perhaps it will force to purchase Shelfari or spin off the LibraryThing portion of AbeBooks. Whatever occurs, I am sure Shelfari’s Josh Hug will be watching very closely.

        1. Vatch

          I’ve never ordered directly through ABE, but I have used their site to find out who has a particular book that I want. Once I know that, I find the bookseller’s web site or phone number, and I order the book directly from them. Unfortunately, some of the booksellers work part time selling books, so they don’t have a web site or a published phone number, and they only deal through a front like ABE. Those folks don’t get my business.

  26. persona101

    just wondering why nobody seems to care about Hollywood and its monopoly. I see a lot of articles about all kinds of monopolies such as amazon, but rarely see any outrage or concern about how Hollywood dominates film production and distribution around the world to the detriment of local and national culture. It might come as a shock to Americans, but people in other countries make movies and tv shows too and no one will convince me that the small number of movies made by Hollywood studios in a year are always better than the combined production from the rest of the world, and so deserve to be seen above all other films.

  27. mccart

    I live in usa and life is worth living comfortably for me and my family now and really have never seen goodness shown to me this much in my life as I have been going through a problem as seriously as my son found a terrible accident last two weeks, and the doctors states that he needs to undergo a delicate surgery for him to be able to walk again and I could not pay the bills, then your surgery went to the bank to borrow and reject me saying that I have no credit card, from there i run to my father and he was not able to help, then when I was browsing through yahoo answers and i came across a loan lender MR TONY HARTON, offering loans at affordable interest rate and i have been hearing about so many scams on the internet but at this my desperate situation, I had no choice but to give it an attempt and surprisingly it was all like a dream, I got a loan of $ 50,000 and I paid for my son surgery and thank God today is good and you can walk and is working and the burden is longer so much on me more and we can feed well and my family is happy today and i said to myself that I will mourn aloud in the world of the wonders of God to me through this lender GOD fearing MR TONY HARTON and I would advise anyone in genuine and serious need of loan to contact this God-fearing man on through .. and I want you all to pray for this man for me

    Thank you

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