Hmm, then we also need to stop Google, Microsoft, Facebook, Dropbox, TimeWarner Cable, military industrial complex, some big oil companies, a few hedge funds, a few banks, etc. Probably might as well call it quits with this whole capitalism thing.
In all seriousness though why don't any of these articles ever address the underlying issue of why this stuff happens. If you have a certain kind of economic system then some things are inevitable. It is the exact analog of traffic on highways. It is just an emergent property of the system.
That worked fine before the modern global economy. Now? It's the death-knell for industry in your country. Without a global government agreement you simply can't bust up megacorps like you used to- they're effectively above the law.
As I'm sure you're aware, there is some room between "completely law abiding" and "totally above the law", where corporations find themselves quite comfortable.
Corporations are amoral, and so conform to local laws only because it is economically efficient to do so, not out of ideological adherence to principles of justice.
> As I'm sure you're aware, there is some room between "completely law abiding" and "totally above the law", where corporations find themselves quite comfortable.
Great, so don't write "above the law". Hyperbole is annoying and distracts from real, important discussions about these kinds of things.
Omniusaspirer actually wrote "they're effectively above the law", which is hardly hyperbolic, and was directly preceded by a decidedly relevant example: "Without a global government agreement you simply can't bust up megacorps like you used to".
Consideration of the fact that multi-national corporations transcend national law-makers is part of "real, important discussion about these kinds of things", as you put it.
What he wrote is plain false. It's wrong. It's incorrect. Those companies must - and do - respect the laws of the countries they wish to operate in, although clearly they try and wiggle and squirm around them where they can. When push comes to shove, they are most certainly not above the law.
When you write things that are false, it does not help a conversation go anywhere useful.
Your definition of illegal behaviour seems to rest on a very narrow view that unless behaviour is prosecuted then it is not illegal. By this view, corporations are not above the law because when any illegal behaviour is discovered they are duly prosecuted, when laws are available, and if laws are not available then it was not illegal behaviour in the first place. However, Omniusaspirer's contention was that corporations are "effectively above the law", not that they were literally above the law.
The exemplary area in which corporations are effectively above the law is tax arrangements, where multi-national corporations can take advantage of their multi-national status to pay lower amounts of corporation tax than companies in all the national jurisdictions in which they operate.
The corporations are effectively above the law because they are legally paying lower taxes than those other companies. That is, they get preferential treatment by satisfying the letter of the law, but not the intent, that being evidenced by current international efforts to close these loopholes. Such issues can only be addressed by multi-national or even global agreements, as Omniusaspirer said.
No, my definition would be that multi-national corporations are effectively above the law if, in a particular jurisdiction, they can engage in behaviour that companies constrained solely to that jurisdiction cannot engage in.
I am glad that we have cleared up the difference between being literally and effectively above the law, but I doubt we'll make any progress towards agreement about what being effectively above the law might mean. As we have already circumvented the HN efforts to avoid debates that aren't going anywhere several times, I guess I'll leave it at that. Have a nice day!
edit: Just to be clear, my above definition would also extend to arbitrary numbers of joint jurisdictions. So if corporation X, doing business in jurisdictions A, B, and C, can engage in behaviours within jurisdiction A that are unavailable to corporation Y, which only does business in jurisdictions A and B, then X would be effectively above the law with respect to Y. This definition seems very natural and clear to me: one group is allowed to do things another group isn't by some special status, ergo, they are effectively above the law.
Also, in the United States, Amazon has generally not fared well when it came to avoiding collecting local taxes when local authorities decided to put their feet down:
As an eu citizen I knew that, and I can tell you they are "working on it" since decades of years (almost since Apple for the first time implemented it around the '80s), Nothing changed because Ireland doesn't want to change its taxation because the corps on its field lobby under the threat to move to another country, and the EU commission has not the power to impose the change to Ireland.
If Google 'should' pay taxes and have not, why haven't they been taken to court? That's tax evasion. Tax avoidance is what sensible people do. You look at the rules, follow them and minimize your tax bill. Google's shareholders also expect no less.
No one can stop them (Google)? Of course they can. It's up to countries to change their tax laws if they think they are not fit for the job.
Sure but that still doesn't address the actual problem and from a certain viewpoint two companies doing the same thing is less efficient than a large company doing it because of economies of scale. So which is it? Do we want efficiency or fairness?
Fairness. When would we ever want anything that is efficiently unfair?
Two companies doing the same thing brings the benefits of competition, which forces down prices, promotes innovation, and actually increases efficiency as they have to be better than their rival. In addition, no reason why both of them cannot be large enough to benefit from economies of scale (think Samsung vs Apple for smartphones).
There is an entire field of mathematics dedicated to answering such questions and the answer is a lot more complicated than your simple quip. In fact the way most democracies are set up they are theoretically much less optimal than they could be and in some cases are as good as dictatorial systems because of susceptibility to being rigged. As usual wikipedia is a pretty good starting point: https://en.wikipedia.org/wiki/Voting_system.
Would you mind slapping a name on said field of mathematics, because I dig that stuff but only ever stumble upon smatterings of it here and there. I'd love to get to the core of that field. Its like game theory + lots of other stuff. (Sorry for off topic)
> Hmm, then we also need to stop Google, Microsoft, Facebook, Dropbox, TimeWarner Cable, military industrial complex, some big oil companies, a few hedge funds, a few banks, etc. Probably might as well call it quits with this whole capitalism thing.
Now you're getting it! Yes, that is exactly what we need to be doing.
There aren't many things on that list that we wouldn't be better off without. Is that really what you meant? You're in favour of big oil companies, hedge funds and the military-industrial complex?
The latter is particularly surprising, unless you think 50% of America's budget going on weaponry to fight threats that don't exist is a productive use of capital
I'm not in favor or against any of the things I mentioned. I was just trying to make a point about emergent properties of complicated systems like global economies and nation states.
Not as a call for citation as I have some basic understanding, but I'd like to learn more about why those threats are considered non-existent and why the USA keeps fighting them.
If by "certain kind of economic system" you mean a heavily regulated pseudo free market system, then sure. But don't try to pretend, as I think you are, that regulation isn't the important bit there and that somehow the free market is the cause of these monopolies. The systems of regulation we have today are both not very effective and also generally hugely advantage consolidation, working against the often inherent advantages of fresh startups as competitors.
I hear this expression, "heavily regulated", a lot from Americans but I never understand in context to what? Are you making comparisons to Canada, the EU, China or other countries with different economic systems? Also, how do you further differentiate necessary regulation from overbearing regulation? Surely you aren't suggesting all regulation is inherently bad?
I'm not pretending. I also disagree that a truly and freely competitive system is the answer. I don't think in the entire history of the world there has ever been any kind of free marketplace and the discussion on these matters are very often mired by ideological biases. Economics falls in a weird gray zone buffered by pure economic theory on one side and practical social constraints on the other.
This is what happens when wealth accumulates at the top of the pyramid. The video is talking about people, but those people are those behind the companies you mentioned (including Google, Facebook, hedge funds and oil companies). The problem with capitalism in my opinion, is that it's not truly capitalism: i.e. it's not the free competition system they claim it to be, but a system which is "more free" for some.
9 Out Of 10 Americans Are Completely Wrong About This Mind-Blowing Fact
Was Upworthy really the best source for this? The transcript is very nearly useless.
Furthermore, 'true' captalism with a truly free market is quite unrealistic, since it would require all participants to be effectively omniscient and infinitely rational (and even then you would have to compare it to 'true' communism, where no one is ever selfish or lazy)
>Amazon has left a trail of destruction—competitors undercut, suppliers squeezed...
We normally call that progress. That "trail of destruction" is leaving money in the hands of millions of people who used to be captive to the local brick and mortar retailers.
If you want a job, why not just dig a hole in the street and try to get paid for it?
That would not be different from keeping a job that is not needed anymore alive just for the sake of the job.
If you feel bad about Amazon, donate 10% of what you buy at Amazon to a "hole digger foundation" which pays people who lost their jobs because of Amazon to dig holes.
There's a tragedy of the commons at work here. Amazon is playing in a new global marketplace, and the unquestioned assumption is that the lower prices that result for consumers are an overall good for society.
But there are plenty of indications that's not true, and that minimally higher prices spread across millions of customers that in turn support millions more local jobs may be better for society overall.
Arguing that a job is "not needed anymore" in this case is like arguing "keeping your own field that is not needed anymore" is stupid just because there's some new common grazing ground opened up.
> minimally higher prices spread across millions of customers
Except higher sticker prices on commodity goods are regressive. If people are worried about the cost of living, raising the cost of essentials is absolutely worse, all things being equal. I would like to see the math behind the way to raise the cost of toilet paper while simultaneously making it universally easier to buy toilet paper.
There's a case to be made that raising prices (or taxes) on non-essentials is a good idea, but pricing rules inevitably become susceptible to lobbying and discourage innovation (why invent a yacht that costs half as much to manufacture?). Introducing "sin" taxes (cigarettes, oil, carbon emissions, corn syrup) might be a good idea if there are affordable alternatives, but you're also introducing morals into your economic system, which has its own problems.
If the concern is that it's hard to earn enough money to live, why not address that problem directly through minimum incomes, earned income tax credits, and the like? I don't see why we have to interfere with pricing to achieve those ends.
>But there are plenty of indications that's not true, and that minimally higher prices spread across millions of customers that in turn support millions more local jobs may be better for society overall.
I doubt that's actually true. The problem is job losses are easy to attribute to Amazon's influence, whereas job creation is not. But that doesn't make it any less real.
What indications are there? And isn't what you describe just a very inefficient system for distributing money? Why not free up the workers and try to find something new for them to do?
If that's what consumers decide they want, then I don't think its wrong to say that is their purpose.
It's kinda sad to see them go, but that's OK. We no longer see as many of the beautiful locomotives as we used to, even though they where excellently engineered with tremendous history. But that's OK, since they've been replaced by other means of transportation/shipping.
Things change, sometimes that sucks. We all move on and try to make a more awesome world in other ways.
More efficiency always results in lost jobs. But the money consumers are saving is going somewhere, so there will be new jobs in other sectors. Creative destruction and all that.
The Luddites were upset because of job loss to automated looms, but in the end everyone was better off.
Convenience, low prices, extensive catalogue, pleasent customer support, innovative products... Yes, we need to kill the beast. Maybe pander and bait some clicks in the meantime.
I particularly liked the part where threatening Hachette's business is threatening democracy. What about shitty journalism? Seems like a much bigger threat to me.
> Convenience, low prices, extensive catalogue, pleasent customer support, innovative products... Yes, we need to kill the beast. Maybe pander and bait some clicks in the meantime.
Don't you think the article raises a number of valid points? While Hachette is little better than Amazon, having an effective monopoly on such a large market is definitely not healthy. The fact that they are exploiting their workers doesn't help.
"Meanwhile, both companies have studiously avoided unionization and treat their workers miserably. In one famous incident, Amazon hired paramedics to revive heat-sick employees at a Pennsylvania warehouse rather than buy an air-conditioning unit."
The Supreme Court heard oral arguments today in a case involving Amazon working conditions, although the workers involved are actually employees of Integrity Staffing Solutions, Inc., which provides staffers for Amazon warehouses.
The workers are required to go through security screening at the end of their shifts, to make sure they aren't stealing from Amazon. There are only two check stations for the entire warehouse they work in, and it often takes workers 25 minutes to get through the line and leave.
They are required to clock out BEFORE they get in line, so that's 25 unpaid minutes.
The workers won in the 9th Circuit, and that spawned several class action suits seeking compensation for about 100000 workers who are subject to post-shift security screenings. CVS Pharmacy and Apple are also facing such suits.
The company is arguing that time waiting in line for a security check is similar to commuting time, which companies do not have to pay for. That law is that employers have to pay for things that are "integral and indispensable part of the principal activities" of the job. Several Justices seemed skeptical that this covered security screenings on exit--it's not a principal activity of the job.
The lawyer for the employees argued that an employee is hired to do what he's told to do, and so should be paid for things that the employer requires him to do.
Some Justices did seem receptive to the worker's case. Justice Kagan noted that what makes Amazon special is that they have a better inventory control system than their competitors, and it is very important for them to know where everything is. Merchandise security is a principle activity of Amazon's operations, and so the security checks would be a principle activity of the job.
Not germane to this case, but I've recently started to wonder why employers aren't more responsible for commute times. There aren't really incentives to situate places of employment in affordable neighborhoods.
Long commute times end up being a regressive drain on the time of employees, and employers bear no responsibility to alleviate the problem though they are complicit in its creation.
I think that's a great reason to force them to indemnify their workers and ex-workers, and to provide safe working conditions. I don't see how it justifies breaking Amazon up. It's not like smaller firms don't often do the same - for example, the Chinese restaurant workers we read about just a few days ago weren't exactly hired by multinationals.
They also use lame processes here in Germany, by hiring people from the job centers in a situation that they cannot reject offers, with a salary that barely gets to the end of the month and bad working conditions.
Oh, please. This piece is silly. Amazon's ebook "monopoly" is incredibly fragile. Either Apple or Google could squash it without breaking a sweat. Microsoft, Facebook and others could too, they'd just probably sweat a bit.
None of them want to. That's not an accident. It's because Amazon isn't giving them an opening by abusing either customers or suppliers. Publishers can claim otherwise, but they're not putting their money where their mouths are. They're not walking away from Amazon, nor can they even demonstrate that they're getting clearly better terms from anyone else.
The problem isn't that a company has a monopoly per se, assuming that the monopoly was achieved by outperforming its competitors fairly and legally.
The problem arises when a company abuses its monopoly position or, far more commonly, when an oligopoly engages in implicit collusion. As a general rule, such situations result in the suppression of competition, which leads to higher prices and a poorer product/service for the consumer.
Economies of scale are good but I think we're entering a world where the negatives are growing too rapidly. If the economy consisted of more small companies, there would be more competition, more employment, and more innovation. And, per Stallman, it can all be rigged with the tax code.
It seems as though the author has a problem with capitalism and free markets in general. Yes, let's abolish capitalism, allow some central bureau to fix prices and use its power of violence over actors who don't comply. Oh wait... it was attempted 90 years ago and it didn't work out.
Not picking on you in particular you are just an example of an attitude which assumes that we either have complete freedom for businesses to do as they wish or (gasp!) "communism" with state control. The "law of the excluded middle" springs to mind.
There are plenty of examples of state regulation in the greater interest, pharmaceuticals being an obvious example, road safety another. It is not in the greater interest of society to allow businesses to trample over each other or to do as they wish.
Amazon is acting to the detriment of a large number of industries and ultimately to people in general by stifling competition and by being monopolistic and abusive.
Just because Marx failed to provide a solution doesn't mean he was wrong about the problem. The underpaid workers at Amazon are just a symptom of the extreme consolidation of wealth that is slowly but steadily undermining the entire basis of the type of prosperous rising-tide-lifts-all-boats capitalism that was the foundation of America's 20th century growth. We're facing real problems in the near future that neither Capitalism nor Communism has the answer to.
The workers are paid what the market is willing to pay them. If there is an inefficiency/mispricing and someone can get better compensation elsewhere (for the same skill set, presumably), then it makes sense for them to arbitrage that gap and change employers. If enough people leave Amazon, then Amazon will have to start paying people better, and ultimately, the gap will close.
This is a very "communist" answer, because it pretends as though wealth and value are static, inherent things, rather than dynamic products of human activity. A parody of communist thought would be to say that they believe that wealth comes out of a factory (the "means of production"), and it's just a matter of manning the stations and throwing the "on" switch to get wealth coming out, from there it's mostly a matter of who gets what. This is a fantasy, and a dangerous one at that. Because of this stilted viewpoint, "communists" tend to imagine that the only way for the wealth of a "worker" to increase is to take that wealth from elsewhere. The reality is that wealth creation is an incredibly complex and dynamic dance between many disparate individuals and systems, and it is not fixed.
There's tons more I could say on that subject but let me skip ahead to what I think the problem is in the US today in regards to worker wages. I don't think it's a problem of some inherent evil in the free market. Rather I think it's a symptom of excess regulation and taxation (and other costs) and a poor educational system, among other factors. The cost and complexity of living these days is much higher than it used to be. There are so many bills, so many taxes, and so on. The bar for a "reasonable" living is much higher these days, and much harder to obtain, with more pressures from every direction on savings and discretionary income. More so, the increasing costs combined with increasing necessity of higher education has put a lot of young workers in a financial pinch, as did the latest housing crisis. People aren't getting the skills they need to build strong careers and to have greater negotiating power. People are being discouraged away from trade schools and funneled into liberal arts colleges. People are being saddled with huge debts in exchange for skills that don't go far in the marketplace, they're discouraged or prevented from saving, they're discouraged from creating their own work (unless they're in software, which is the rare exception) by starting their own companies. All of those things were on the table for previous generations. Without them we've ended up with a generation of workers who are desperate to find and keep a job, who must rely on working for a big corporation because they need that surety of a paycheck to pay their high costs of living and their debts. We like to imagine that all these regulations and taxes have no negative consequences because they were created with the best of intentions, though that's not the case.
But every element there is amenable to improvement, without resorting to marxist wealth redistribtion. I would posit that the consolidation of wealth we have been seeing is not the cause of the problem but rather the symptom of a larger underlying problem.
If a monopoly spontaneously emerges out of a free market, whereby no violence or coercion was used against other participants, then that business was simply better and more efficient at giving the market what it wants. It also doubles as a price signal to others that something in their way of doing business is inefficient and wasteful (or just not as efficient as the most efficient participant).
I don't have a problem with such "monopolies", because they aren't real monopolies. As long as the market is still open to new participants, then it's not really an issue. For example, if a monopolist starts raising prices and hoarding supplies in order to artificially elevate prices, then new participants can enter the market and make money off the delta between the new prices and the old prices that made sense to the market.
You touch on something important. Beyond the fact that the term monopoly gets thrown at a company without any further qualification of such a statement, there's no real thought put into how the company is using said alleged monopoly power to raise prices on consumers or create barriers to entry in the market.
Amazon's prices trend downward, constantly. Amazon is also itself a market facilitator, agnostic to which products sell, so long as they sell. High quality and low prices race to the top of customer ratings. Third parties sell on Amazon as well, providing a global market for local brick and mortar shops. Further, Amazon is by far not the only website selling things on the internet. The internet is pretty great at lowering barriers to entry.
If a single player can move the market, then it's not a free market. You can throw out all the theories about economic efficiency when we reach that point.
Are we really facing "less variety of products and lower quality of the remaining ones"? I see more variety in Amazon's kindle store than I ever saw in a traditional publisher's range, and while the average quality may be lower the peaks are as high as ever.
If Amazon really did undercut Diapers.com by selling at a loss, that sounds like a perfectly good case for existing antitrust laws, not something that requires executive action. For the rest, I'm happy to reap the benefits of what Amazon gives us.
We have to remember that when we talking about giant companies we are talking about giant institutions, of a form and culture that has not existed in human history. The closest parallels common throughout human history are armies.
I think that our 20th century paradigms have failed to understand and shape these institutions, each with their own trappings. Labour unionism, which was deeply rooted in man labour cultures and many countries' political systems was amazingly corrupt. They became their own institutions layering their own dynamics and interests into the already impossible mesh. The results were far from unanimously positive.
Liberal-capitalism nurtured the concept of non natural person, corporate entities. The cultural relationship between individual, employers, consumers and investors and the institutions is grafted onto the idea that the institution is a legal person. At this point, companies are far more than risk sharing and limiting devices. They are institutions of the same gravity as churches, bureaucracies, aristocracies and such. They are entrenched. I don't mean that in a strictly accusatory sense. They are just part of the web of culture, laws, economies and everything else.
First of all, we all need to have the humility to understand how little we know about how these things work. We are designed to operate within social institutions, not to build and destroy them each generation. No one built feudalism or poleis. No one really designed the international system of nation states. No one created Danish national identity. These things just evolved. Those are the kinds of things we're dealing with.
I don't know what is the right way of dealing with Amazon, Google or Walmart as a (global) society. I think I would be more comfortable if the times brought around a period of miniaturization, where these mega institutions gave way to hundreds or thousands of smaller ones.
For Amazon, what's keeping them huge is (a) dispatch & postal delivery is surprisingly hard. (b) The chain between design, manufacture, marketing and delivery is surprisingly cumbersome. Amazon is a company that does what a market would do in a world fewer impediments.
Maybe the next few decades will make global delivery trivial. This would enable products to come directly from suppliers and simplify the chain. Software developers once had to sell software through software stores. The modern incarnations of software store is a relatively thinner layer. Producers are closer to consumers and the intermediaries are really just market makers.
PS: Price controls have a bad track record dating back to Roman times.
Evolution of human culture can either be recognized as a consciously directed emergent property or it can be consciously ignored and instead directed by the unification of unspoken (but existent) belief systems of the majority. Cultural evolution isn't magic. There are properties that can be recognized for what they are and what role they play in the development of culture.
I think it is disingenuous to point out the size of institution versus the capability of the mind to analyze and distill what goes on. The law is supposed to be blind. That means to me, the law should be sound on its own ground, without being dependent on rhetorical arguments that paint possibly sneaky incentives over as abstract 'biological cultural sociological imperatives'.
I think for the nature of this argument, understanding the broad picture is complicated and takes time, caution, and care, neither of which can be established through armchair analysis. Implementation is different than theory.
I disagree. I don't think "human culture can be (honestly) recognized as a consciously directed emergent property," any more than an individuals personality can be directed.
We know some things. We control some things. We can't engineer a human personality. Same goes for human culture. We can't decide to model Iraqi culture on Italian culture. We can copy some institutions, the copying is indirect. The cards will fall where they may, and the honest truth is that we don't know how it works.
Before the fact we have a bunch of angry amadons screaming that xyz will happen if we do xyz. After the fact we have the amadons arguing about what really happened. No knowledge is gained.
No, I am saying that the collective unconscious belief system of a system itself (here, I am calling a collection of humans, or a society - to be a system) is what can direct it.
This means all those side thoughts you think you ignore. When you choose to listen to analysis over intuition, but you might not consider the effect of ignoring intuition in favor of analysis, or you may even deny the existence of intuition because analysis exists. Intuition can be uniform across a population and can direct the population. I am not trying to be Freudian here, unconscious is just a word for 'thoughts you keep to yourself'.
It's all the thoughts and actions that we take that we don't tell one another about, things we may not even be aware that we are doing (like independent thinking, thinking about what other people are thinking), that can create direction within a social system.
I am not saying "engineer a human personality". I am saying "engineer yourself", and consider what that means across a collection of people when they are all engineering themselves, and happen to mutually, mentally agree on some things, but do not express this directly to one another.
I think it's important to make a distinction between clever emergent processes that people are involved in but aren't in control of and those that people made and are in control in. The distinction is vague, and arguable.
I'm generally pretty down on systems (politics and economics are really burdened by these) which overreach by overstating our understanding of things. Just because a theory is the best we've got, doesn't mean it's good enough to be made operational. When people start getting grandiose with their social and political theories I think of 18th century surgery.
Kinda wish this was the top voted answer because you do a much better job putting things in perspective in terms of all the interactions that are involved. Maybe HN should implement a vote transfer feature.
Amen. Most of Amazon's nearly 100k large workforce are warehouse workers, running around all day like rats in a maze with no real break, no opportunity to connect to other humans, no autonomy and no final product to be proud of. If that isn't a recipe for misery, I don't know what is.
"We have much studied and much perfected the great civilised invention of the division of labour; only we give it a false name. Truly speaking it is not the labour that is divided; but the men: – Divided into mere segments of men – broken into small fragments and crumbs of life; so that the little piece of intelligence that is left in a man is not enough to make a pin.
"Only in right understanding on the part of all classes of what kinds of labor are good for men, raising them & making them happy, and by a determined sacrifice of such convenience, or beauty, or cheapness as is to be got only by the degradation of the workman; and by equally determined demand for the products and results of healthy and ennobling labour can this evil be met." -John Ruskin
Funny you mention "running around all day like rats in a maze" as I have a good friend that just did an Amazon warehouse tour this week. He's the CTO for a company that runs several warehouses and he commented on the fact that the pickers were actually quite slow compared to what his pickers and others he's seen do. I was surprised because I too had read many times about how the warehouse pickers have to basically run everywhere all day.
But in truth doesn't Amazon act more as a economic lubricant? Connecting consumers with all sorts of industries and businesses all across the world? For every industry or business that's "trampled" aren't an equal or greater number of businesses benefiting? It's like a shit hot postal service with a great website that's hugely profitable and ploughs most of its profits into making the service even better. It renews my faith in the human race to get big stuff done, and done well. I'd say we need to keep an eye on it, especially its tax affairs, but for now its probably best just to wait and see what happens ...
I disagree completely. Amazon is successful through legal means. What do you want to do? Government punishing them for being too successful? As long as there isn't regulation that prohibits market entrants --a big reason for monopolies in the late 19th and early 20th century -- I don't see exactly what someone would suggest to do. The free market is a cumulation of mutually beneficial exchanges-- its a volunteer economy. Amazon's not forcing anyone to do anything. Publisher's do business with Amazon because it benefits them. They could easily stick with Barnes and Noble. Capitalism is by no means perfect but it's the best way to distribute capital. It's the only economic system that's brought masses of people out of poverty. For someone to say government should step in and set pricings!? Force Amazon to breakup?! Government knows better than anyone else? They know the market better than the participants? Who are these people in this all-knowing government? I'd like to meet them.
What industry does Amazon have monopolized anyway? 41% on new books? cool. their cheaper prices on books benefit all of americans more than it hurts the handful of publishers. Fact is monopolies are defined by if they set higher prices than would-be in a perfect competition industry. As long as prices are low -- it signals they have competition-- so don't come at me talking about how big of a monopoly they are.
Modern society always progresses at the cost of old, inefficient jobs, while redistributing the wealth from those destroyed markets. The only concern is whether the redistribution of wealth is towards equality or inequality. As long as wealth is transferred to more people, the overall gain of buying power will eventually create a better economy.
The problem is really not about monopoly, but whether the beneficiaries of these business contain a larger population.
I'm not American, and had not heard of New Republic. But reading this article, I think New Proletariat sounds like a more honest name for their magazine.
I shop at both Wal-Mart and Amazon, oddly both also benefit some smaller companies I purchase from. Wal-Mart shopping centers, at least near me, have all sorts of restaurants and specialty stores I like/use/need. Amazon's market place has let me source some products that were previously difficult to find elsewhere (Skyflakes crackers for one, many other items from that side of the world could be found but not consistently or for good pricing)
The book industry needs to change, I haven't come up against the dark side of Amazon's influence. I did watch for years when Apple and the publishers clearly broke the law and cheered when they got caught as I had seen prices for books I bought just sky rocket.
As for how their employees are treated or their "perceived" treatment, local employment laws cover those. Avoiding unionization is not a crime and should not be held against anyone. Much of retail outside of grocery is not unionized. When the same unions hire no benefit, no union, temps to protest tell me again how they are the good guys?
> ".. more attention will fall on a strange inefficiency at the heart of the business: the advances that publishing houses pay their writers. This upfront money is the economic pillar on which quality books rest, the great bulwark against dilettantism."
It can't be that inefficient, since publishers are still in business and Amazon wants more of their money.
The author appears to suffer from nostalgia bias, longing for turn of the century progressivism to reign in his old corporate foe. This same well of centralized thinking gave a brave new world eugenics, prohibition, and industrial nationalism. Antitrust is indeed an important emergency power of the government, but its utility is most often the self-corrction of errors caused by the state itself.
If you want to target monopolies in this modern age, go after companies like Comcast that arise out of state induced monoploy as a matter of necessity but go unregulated beyond that. The only thing Amazon is guilty of is decreasing costs of living for millions. It is no more at fault for liss of jobs in bygone industries as Ford was for layoffs in the horse and buggy industry.
The authors's argument essentially amounts to the Corporations Being All Corporationy.
Can someone provide practical examples of how Amazon would possibly abuse their monopoly without breaching existing law, influencing the government, or opening up the market for a smaller, more agile competitor?
It is strange picking on Amazon, as the barrier for entry into the online shopping industry is relatively low, and their monopoly is far less stable and enduring than what Microsoft and Google achieved.
> barrier for entry into the online shopping industry is relatively low
I was under the impression that online retail is extremely capital-intensive. Especially in the initial years, where companies use capital to undercut competitors.
I disagree. They literally give me everything I want, at a reasonable price. If you have some alternatives that fit that bill, I would be willing to consider them.
In some areas maybe. Seems newegg and Tiger Direct have similar prices still though for electronics. I wonder what the difference in sales volume is. What are newegg's logistics like, anyone know?
At least for ebooks it recently occurred to me that it will probably be difficult for any ebook vendor to establish a monopoly. After all, everybody can just offer ebooks on their web site.
It comes down to a question of definition. Is it a monopoly if there is literally zero cost to entering a market, but the market conditions make it almost certain that you'll fail?
Hatchette and any other publisher could stop selling their books to Amazon tomorrow. You could still buy them in paper from loads of physical stores, and you could still buy their ebooks from dozens of places, including little-known and difficult-to-find resellers like Apple and Google. But if they lost, say, 40% of sales, would we call Amazon a monopoly?
I don't know. My inclination is to be pretty conservative in applying heavy-handed regulatory remedies. That's a big hammer, and it's one I'd rather not use on a whim, and right now, I think it's still far too easy to compete with Amazon on its core business for this to be an option I'm ready for. But I'm not sure how hard it would be to convince me otherwise in the future.
Maybe the kindle is just a desperate attempt to save some of the book business for Amazon. You are thinking too short term. Sure, maybe it will be a quasi monopoly for a while. But in the long run, why should people stick with the kindle? Other convenient devices and services will crop up making it seem very inconvenient to be tied to one vendor.
In all seriousness though why don't any of these articles ever address the underlying issue of why this stuff happens. If you have a certain kind of economic system then some things are inevitable. It is the exact analog of traffic on highways. It is just an emergent property of the system.