Conor here: A few recent pieces from Jeff Bezos’ Washington Post (“Why you may not want lower prices as much as you think you do” and “Actually, today’s food prices are a bargain”) make for good partner pieces to the one below.
And here’s a more detailed thread from Stacy Mitchell than the one featured in the following article that really highlights how this also decimates American businesses. It’s all worth a read—as is the Institute for Local Self-Reliance report— but here are a few key points:
9. These independent suppliers often outperform Amazon: In a price comparison of 628 frequently purchased school items, an independent office supply dealer beat Amazon on 68% of them. And, unlike Amazon, these suppliers provide consistent next-day delivery & high level service. pic.twitter.com/wge8WTBuss
— Stacy Mitchell (@stacyfmitchell) December 4, 2025
12. The reality can be seen in the data: In Berkeley County, WV, the schools spent $1.3 million with Amazon — and only $142 went to in-state sellers. The vast majority of the district’s spending went to Amazon itself or to overseas vendors. pic.twitter.com/teioIXb4bF
— Stacy Mitchell (@stacyfmitchell) December 4, 2025
By Jake Johnson, a senior editor and staff writer for Common Dreams. Originally published at Common Dreams.
A detailed investigation released Thursday reveals that the e-commerce behemoth Amazon is using its market dominance and political influence to gain a foothold in local governments’ purchasing systems, locking school districts into contracts that let the corporation drive up prices for pens, sticky notes, and other basic supplies.
The new report by the Institute for Local Self-Reliance (ILSR), titled Turning Public Money Into Amazon’s Profits: The Hidden Cost of Ceding Government Procurement to a Monopoly Gatekeeper, is based on purchasing records from nearly 130 cities representing more than 50 million Americans.
ILSR found that “cities, counties, and school districts spent $2.2 billion with Amazon in 2023—a nearly fourfold increase since 2016.”
“Through its Amazon Business platform, the company has maneuvered to become the default source for office products, classroom materials, cleaning supplies, and other routine goods,” the report states. “Today, it is embedded in most local governments, making inroads into state agencies, and dominating a new program designed to reshape how federal agencies buy commercial products.”
Unlike the fixed pricing that’s typical for government contracts, the agreements that Amazon has secured with local governments across the US entail “algorithm-driven pricing” to “covertly raise prices and inflate costs for governments.”
“The result is dramatic price variation: One city bought a 12-pack of Sharpie markers for $8.99, while a nearby school district paid $28.63 for the identical pack that same day,” ILSR said. “Our data contain thousands of similar examples, with some agencies paying double or even triple what others paid for the same items.”
1. Hard to believe, but Amazon has persuaded schools and cities across the country to abandon competitive bidding and fixed price contracts. Instead, they’re signing contracts with Amazon that specify dynamic pricing. The result: Paying $37 for 12 pens or $74 for 36 markers. pic.twitter.com/afIIkPucZL
— Stacy Mitchell (@stacyfmitchell) December 5, 2025
Overall, ILSR found that school districts bound to Amazon contracts spend twice as much per student as school districts without an agreement with the $2.5 trillion company.
“Public officials should be deeply concerned by what we found,” Stacy Mitchell, co-executive director of ILSR, said in a statement. “Amazon is reshaping public procurement in ways that expose taxpayer dollars to waste and risk. It has persuaded cities and schools to abandon safeguards meant to ensure fair prices and accountability—while driving out independent suppliers, eroding competition, and putting Amazon in a position to dictate terms.”
Having gained sweeping access to local government purchasing processes, Amazon is increasingly inserting itself into state and federal systems. ILSR noted that “Amazon dominates the General Services Administration’s Commercial Platforms Program, a new system for agencies to make purchases below $15,000 that do not require competitive bids.”
“During the first two years of the program’s pilot phase,” the group found, “Amazon captured 96% of sales.”
ILSR emphasized that Amazon’s dominance is by no means inevitable and can, with concerted action, be rolled back.
“A handful of cities and counties have recognized the risks of relying on Amazon and taken steps to restore transparency and keep public dollars local,” the report observes. “Tempe, Arizona rejected an Amazon group-purchasing contract after hearing concerns from a local business owner. Between 2017 and 2023, the city cut its Amazon spending by 84% while increasing purchases from local suppliers. Phoenix likewise prioritizes local bids and has spent almost nothing with Amazon over the last decade.”
Kennedy Smith, co-author of the report, said that “when local officials put real safeguards in place and prioritize local suppliers, they save money, strengthen their economies, and restore public control over public dollars.”
To keep their procurement system free of the kinds of tactics Amazon uses to line its pockets with taxpayer money, ILSR urged state and local governments to prohibit so-called “dynamic pricing” in purchasing contracts and to prioritize buying from local businesses.
“By reclaiming control of public procurement, governments can safeguard dollars, strengthen local businesses, and ensure that the goods that sustain our schools and public services are supplied through systems that are transparent, competitive, and democratic,” the group said.
Thanks for this – I hadn’t heard of this particular grift before, but it’s not surprising.
Years ago, a teacher accidentally uploaded a photo of our kid on some google service the school was using. I complained and spoke to the district’s IT person who it turns out didn’t have much of an IT background but assured me it was all fine since google had assured them it wouldn’t store or share any personal info. I didn’t believe that for a minute, but the credulous IT guy sure did. Of course the kids now do all their work on google docs and from reading everything they write and seeing every correction they make, google likely knows the kids better than their own parents do. And they’re their cashing in just like Amazon.
These days it isn’t a village raising the kids so much as a Silicon valley pillage. Nice to see some districts are wising up, but I just don’t understand why so many people put their trust in these tech companies to begin with when they have shown so many, many times that they are not to be trusted. This “dynamic” pricing, which is essentially stealing tax dollars from the local populace, should be illegal but you hardly ever hear a peep from legislatures when it comes to regulating these behemoths. Too much donor money at stake evidently.
School systems may not be the only government players linking with Amazon. If Amazon has served schools so well as the link reports, imagine what it could do for DoD procuments.
https://aws.amazon.com/blogs/publicsector/aws-marketplace-assessed-awardable-for-dod-work-in-the-p1-solutions-marketplace/
14 MAR 2025
“Amazon Web Services (AWS) is pleased to announce that AWS Marketplace has received “Awardable” status in the Department of Defense (DoD) Platform One (P1) Solutions Marketplace. This designation enables DoD organizations to readily access and procure solutions through AWS Marketplace using established acquisition pathways.”
Amazon’s algorithmic pricing is out of control. A few months ago, I bought an excellent product for $5 (unexpectedly low price). I wanted to re-order it but it is now $21 (ripoff price). I would buy this product locally but it’s not available. There are alternatives to this product that aren’t quite as good but will work. I am going to work harder at buying locally as Amazon is profit-maximizing leech on the system.
They have been doing this for decades. Seems like something Congress should have reined in long ago, no?
Trying using the computer of a friend or relative to order your “product”. My guess is the price will be different at every computer you use.
Makes you wonder how much ‘dynamic pricing’ is being implemented to gouge everyday folks.
Probably under the ruse of personalized pricing, or, someother label like anticipitory pricing, AI enabled hand procurement, AI enabled automated customized anticipitory pre-approved sensor based purchasing and delivery system.
It’s a rules of thee, not for me situation.
I remember when I took intro to microeconomics, the professor discussed how dynamic pricing was good, because it reduced deadweight loss under the price/supply curve: People who would be willing to pay more do, while people who wouldn’t be willing to pay more can still get a product at a lower price subsidized by the people who paid more, and the firm captures more revenue while more people in the population enjoy the product or service provided, increasing total welfare. The context he used was airlines: Some people may pay way more for seats that only have small differentiation (an inch more legroom for example) but overall more people can fly and the airline doesn’t lose money for doing so.
The first problem is that if a firm has the ability to get away with dynamic pricing, it already has enough market control that it can dictate monopoly pricing. Why would a private company subsidize consumers who only want to pay below the marginal production price, if cutting them out of supply will increase the ratio of revenue to cost? Revenue to cost ratios seem to be the guiding principle for company evaluations once they have monopoly power (because there’s diminishing returns for trying to capture the full market), and a competitor going after consumers who need subsidies isn’t going to be able to compete when those consumers who have high levels of surplus have already had that surplus captures.
The second problem is more philosophical/societal-values. If private companies claim they should be allowed to use dynamic pricing to charge customers who might be able and willing to pay more to actually do so (Using the above microeconomic explanation I provided) then why do so many companies, and the people who run them, simultaneously lobby against progressive taxation frameworks? Progressive taxation is basically applying the same type of framework and getting the same type of results as dynamic pricing: consumers who have higher willingness to pay and lower marginal utility from holding on to their surplus pay more to subsidize those who are willing to pay, but not enough to cover the marginal cost of extending services to them.
This kind of monopoly lock-in exists in higher ed as well. When I taught at CU Boulder, all office supplies had to come from Staples. If you wanted furniture, it had to come from CORP, who source their wares from prisoners.