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Don Pesci: Amazon strikes back at Willy Loman

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"Sometimes...it's better for a man just to walk away. But if you can't walk away? I guess that's when it's tough.”

—- The Willy Loman character in Death of a Salesman

The old saying is “You can’t fight City Hall.” That is partly true. City Hall is huge and more powerful than you. The gods of government have resources denied to the little people, but then government is supposed to be on the side of the little people, as is the media, a presumed joint support that tends to even the perpetual battle between the lions of the market place and … let’s call him Willy, after Willy Loman, the chief character in Arthur Miller’s play Death of a Salesman.

The Willy of this piece is a Connecticut salesman – there are many of them – who do business with Amazon. And Willy has a problem that will not be settled by the usual white-hatted Attorney General of Connecticut or legislators who weep over the little guy or the media, afflicters of the comfortable and comforters of the afflicted. You can bet your house on that.

In the world of commerce, Amazon is bigger than God. It seems only hours ago that the equivalent of City Hall in Connecticut, state government – not only in Connecticut and its environs, but everywhere in the nation – was breathing heavy in strenuous attempts to lure Amazon into their beds, the better to ravish the e-commerce giant with taxes.


New York Gov. Andrew Cuomo was dashed when Amazon, searching for a place in the Northeast to locate part of its headquarters, kissed the state goodbye. Pummeled by progressives in New York -- among them Mayor of New York City Bill de Blasio (birth name Warren Wilhelm Jr.) and U.S. Rep. Alexandria Ocasio-Cortez -- for having considered the governor's crony-capitalist $3 billion tax break, the company withdrew an offer to plop a new facility in New York that might have generated $27 billion in revenue.


“What happened is the greatest tragedy that I have seen since I have been in government,” moaned a grievously wounded Cuomo.


Crony capitalist blood began to beat like a tom-tom in former Connecticut Gov. Dannel Malloy’s veins, and it still swells in Gov. Ned Lamont’s heart. Both Malloy and Lamont are crony-capitalist governors -- is there any other kind in the high-taxed Northeast? Wouldn’t it be grand to net such a massive leviathan? Malloy moved on, Lamont is fishing still.


But salesman Willy is dangling at the end of an economic rope, and he writes, somewhat desperately:


“If I sell something on Amazon, they take 15% as a referral fee. This covers marketing, customer acquisition, and credit card fees. If I use Amazon to warehouse and ship the item, they then charge a pick and pack fee. That is also taxed. So if I do $1M a year in gross sales, Amazon ends up taking about 33%."


Adding the cost of doing business with Amazon, Willy notes “$330,000 in fees, with 6.35% sales tax is almost $21,000 a year. You should understand that Amazon is half of e-commerce. Third party sellers [like Willy] represent over half of their sales. Connecticut, through its tax additions, just made it impossible for 25% of e-commerce to do business here.”


Along with his note to Connecticut Commentary, Willy enclosed the “Dear Willy” letter he had received from god:


The "Dear Seller" letter Willy received read in part:


“Amazon is required to collect taxes on Selling on Amazon fees in Connecticut, the District of Columbia, Hawaii, South Dakota or West Virginia, based on each state’s tax rates. Selling on Amazon Fees include the Referral Fee, Subscription Fee, Variable Closing Fee, Per-item Fee, Promotion & Merchandising Fee, Refund Commission Fee, Checkout by Amazon, and Sales Tax Collection Fee... If your business is located outside Connecticut, the District of Columbia, Hawaii, South Dakota or West Virginia, we will not collect sales tax on the Selling on Amazon fee you pay.


“Amazon is required to collect taxes on FBA Prep Services in Arizona, Connecticut, Illinois or West Virginia, based on each state’s tax rates. FBA inventory prep fees include the Labelling Fee, Polybagging Fee, Bubblewrap Fee, Taping Fee, and Opaque Bagging Fee...


“You will be able to view the sales tax collected on your fees in the transaction details page of your Payments reports.”


Willy is a Connecticut native with deep roots in the state. He’s married with young childern. And the blade of crony capitalism has fallen bloodily on Willy’s neck, because he is, in fact, an independent businessman who is expected to shut up and pay. Crony capitalism is a complex arrangement in which tax heavy states such as Connecticut and New York supply seed tax money to super-leviathans like Amazon as inducements to locate in the states; the companies then pass along to its customers and third party salesmen like Willy the costs they incur from their location in a high tax state like Connecticut. But the tax axe invariably falls on Willy’s neck. Large companies are tax collectors, not tax payers. The real taxpayers are those who consume the products and services of companies such as Amazon – and small businesses like Willy’s from whom Amazon recovers the additional costs incurred by tax increases.


It will not take long for Willy to realize “Sometimes...it's better for a man just to walk away.” No one profits when Willy walks. It would be well for legislators to remember the line in Willy’s letter. Connecticut, along with a handful of other states singled out in Amazon’s “Dear Seller” letter, has “through its tax additions,” Willy writes, “just made it impossible for 25% of e-commerce to do business here.”

Don Pesci is a Vernon, Conn.-based columnist.




Posted by Don Pesci at 2:04 PM

Labels: Cuomo, Lamont, Malloy, Willy Loman


Mass. takes careful approach to luring sexy companies

“The Amazon Spheres’’ at the company’s headquarters, in Seattle.

“The Amazon Spheres’’ at the company’s headquarters, in Seattle.

Adapted from Robert Whitcomb’s “Digital Diary,’’ in GoLocal24.com

Amazon already has thousands of employees in tech center Greater Boston and will probably add several thousands more, perhaps mostly along the South Boston waterfront, in the wake of the apparent demise of an Amazon “second headquarters’’ in New York City. But this won’t be due to the sort of massive incentives the “populist’’ reaction to which blew up the Amazon-New York deal.

As seen in the deal crafted by Massachusetts Gov. Charlie Baker (a highly successful former businessman and top-notch numbers cruncher) and the generally economically reality-based Boston Mayor Marty Walsh to lure General Electric headquarters, Massachusetts has been quite conservative in crafting incentive packages. Shirley Leung had an interesting column on the GE deal. To read it, please hit this link.

Rhode Island might also get some Amazon jobs — probably design-related — because of the New York news.

The ambiguities of the Amazon mercantile jungle


From Robert Whitcomb’s “Digital Diary,’’ in GoLocal24.com

Boston did well in failing to snare an Amazon “Second (or is it third?) Headquarters’’. The hysterically hyped project would have overwhelmed city services; stolen a lot of tech talent from the startups that are the foundation of the region’s economic future; worsened the city’s traffic woes, and driven up already sky-high housing costs.

And it’s unlikely that Boston and the Commonwealth of Massachusetts would have come up with a bribe to Amazon’s Jeff Bezos that would have been big enough to offset Boston’s drawbacks, especially that it’s probably too small for the likes of Amazon. Despite the company’s show of looking all over America as a place for a “Second Headquarters (which of course turned out to be two “Second Headquarters’’ – New York and metro Washington, D.C.), it probably always planned to set up in cities too big to be overwhelmed by it, and with many, many techies already in residence. The apparently bogus national auction seems to have raised the bribe money that New York and Virginia, whose Washington inner suburb of Arlington, Va., won the prize, were willing to pay. Amazon says it will put 25,000 employees in each place.

Massachusetts Gov. Charlie Baker and Boston Mayor Marty Walsh were unwilling to get into a bidding war with the rest of the country for the projects.

New York State is giving the company a package that includes $1.525 billion in incentives, including $1.2 billion over the next 10 years as part of the state’ s Excelsior tax credit. The state also will help Amazon with infrastructure upgrades, job-training programs and even assistance “securing access to a helipad”. There’s still some confusion about the total package, but by one measurement, it works out to $48,000 per job.

Virginia, for its part, is giving the company an incentive package worth $573 million, including $550 million in cash grants – and a helipad (for Bezos’s convenience to commute to his Washington Post?) in Arlington, right across the river from Washington, D.C. The Old Dominion also pledged $250 million to help Virginia Tech build a campus in Alexandria, near the Amazon site, with a focus on computer science and software engineering degrees. Folks are still trying to figure out the precise total cost.

By one estimate in this rather confusing bag of bribes, the basic package works out to $22,000 per job. We’ll see.

(As sop to the Heartland, Amazon will also put a 5,000-person facility in Nashville, at an estimated $13,000 a job.)

So the individuals and companies already in New York and Virginia will subsidize through their taxes an enterprise that had $178 billion in 2017 revenues and is run by the world’s richest person. And of course it’s impossible to know how well Amazon will be doing in a decade. Might it become the online version of Sears? Nothing lasts.

Think of how much stronger their economic development would be if New York and Virginia had put the bribe money into improving transportation infrastructure, education and other stuff that would make their markets better for everyone!

And will Amazon keep its promise to create all those jobs? Don’t bet on it! Big companies are notorious for breaking employment promises. An irritating recent example:

Wisconsin, with an outrageous $4 billion subsidy, lured Foxconn, the Taiwanese manufacturer infamous for not keeping employment promises, to the state with the promise of 13,000 jobs. But the company now plans to employ only a quarter of that; much of the work will be done by robots. You can bet that Foxconn would like all of the work done by robots! One estimate is that the project works out to $500,000 per Foxconn job.

No wonder that Scott Walker, the Republican governor who pushed for this deal, just lost his re-election bid. But then, Democratic and Republican governors and mayors do these deals with enthusiasm.

The politicians know that such extravaganzas sound great, for a while, and that few citizens look into the fine print or scrutinize these sweetheart deals for their long-term macro-economic effects. And by the time that the full bill comes due, the politicians who initially got credit have moved on to something else.

Anyway, such places as tech-rich Greater Boston (and less tech-rich Providence) would do better to make their communities better places in which to start and nurture companies than to break their banks by trying to get big ones from far away whose loyalty is apt to be remarkably evanescent. That isn’t to say that Boston (which already has a couple of thousand Amazonians) and Providence (with its graphic and other designers) won’t benefit from spillover Amazon jobs from the New York operation. They probably will.

A March 2018 report by the Brookings Institution says that state and local governments give up to $90 billion worth of subsidies to individual businesses each year. How much of this is worth it? To read the report, please hit this link.


Columbus, Ohio, offers an example of how an economic-development policy delighting in diversification, encouraging local startups, and improving local amenities and infrastructure, as opposed to focusing on luring a big, fat famous company, as well as strong civic engagement by a city’s established business community, can pay off.

From 2000 to 2009, Columbus added 12,500 jobs. From 2010 to the present, it has added 158,000!

To read more, please hit this link.





Llewellyn King: Will Bezos's kiss be lethal?

On the waterfront of the Long Island City part of New York City. It’s the flood-prone area where Amazon will put one of its “Second Headquarters.’’

On the waterfront of the Long Island City part of New York City. It’s the flood-prone area where Amazon will put one of its “Second Headquarters.’’

Having run around the country as a modern Prince Charming in search of Cinderella, Jeff Bezos, Amazon's boss, has decided that two hopefuls fit the slipper: Crystal City, Va., part of Arlington, and the Long Island City part of the New York city borough of Queens.

But these Cinderellas aren’t to be carried off to live happily ever after in Amazon Castle. No, there are dowries to be paid -- about $2 billion each in tax abatement and other goodies. These beauties are no bargain.

In fact, New York City and Washington, D.C. -- Queens is a borough of New York and Crystal City is a Virginia suburb, south of Washington -- may be prostrating themselves to gain possibly 25,000 jobs in an unhappy, taxpayer-funded alliance.

The theories as to why Bezos chose these locations abound. The dominant one is that high-tech companies must follow high-tech workers. That explains why Boston and San Francisco are overheated along with, yes, New York and Washington.

This overheating might be described as more people trying to get into a city than its housing base and infrastructure can absorb. Result: skyscraper-high living costs, hideous commutes and wretched lives for those on the economic bottom rung. High rents and homelessness go together.

I'm more persuaded that the decision has been made more to suit Bezos and his executives than to snare talent. Washington is the site of one of the Bezos's mansions and he owns The Washington Post. New York has always had special appeal to the ultra-rich: Wall Street and the gilded social set.

Palo Alto, in California’s Silicon Valley, is white-hot in terms of desirability for high-tech jobs. But it was underdeveloped 45 years ago when a visionary scientist, Chauncey Starr, established the Electric Power Research Institute (EPRI) there. Starr told me he chose the location not because of the talent pool, but because he wanted the independence he feared he wouldn’t get in a big city, close to the electric companies which funded EPRI. The high-tech talent was yet to move in.

The point here is that it’s not necessary to go to the labor, the labor will come to you. Had Amazon chosen, say Upstate New York or somewhere in Kansas, and hung out a shingle for help, it would’ve poured in: Build and they’ll come.

The great Washington hostess and diplomat Perle Mesta said, “All you have to do to draw a crowd to a Washington party is to hang a lamb chop in the window.” The same goes for labor.

The downside to Washington these days is that its roads and bridges, to say nothing of its troubled subway, are inadequate for the stunning growth it has seen since the late 1960s. It has some of the worst traffic jams anywhere and is said to have overtaken Los Angeles for traffic congestion. As the greater Washington area is split between the District of Columbia, Maryland and Virginia, regional problems are hard to solve and often go unsolved as a result.

New York needs infrastructure spending in the worst way, from the tunnels into Penn Station to the estimated $48 billion the subway needs to modernize. But an increasing amount of the city's capital budget is going to have to be devoted to building barriers against sea rise, particularly in lower Manhattan and to a lesser extent in Brooklyn and Staten Island. Is it a good investment to sink money into any location which is going to have to throw its treasure at Neptune, not improving the rest of the infrastructure?

As someone who lived most of his adult life in Washington, I don’t celebrate its helter-skelter growth, gridlocked roads, potential water shortages or the just-upgraded sewage treatment plant, Blue Plains, which has been known to flood, sending the raw stuff into the Potomac River in big rainstorms.

Virginia and New York, have you bought into a cyber-dream from Amazon which denies reality? You’re paying for a tenant who should pay you for the stress of his buildout.

Prince Bezos, there were so many other pretty feet.

Llewellyn King is executive producer and host of White House Chronicle, on PBS. His email is llewellynking1@gmail.com and he’s based in Rhode Island and Washington, D.C.


For Amazon HQ2 pitch, cities needed to promote their REGION

Worcester    -- Photo by Viking 1943

Worcester

-- Photo by Viking 1943


"For small cities like Worcester, bids like this are a missed opportunity not because small cities are not eligible, but because many misunderstand how to sell themselves to large employers.  The video that Worcester produced to entice Amazon HQ2 shows off some of the city’s shining stars, such as its medical school, its hockey team and Union Station, but fails to showcase the regional workforce—let alone any other regional assets. When an organization chooses a site, the city name in its address is of less importance than the complete network of resources accessible to the organization from that location. Worcester’s application represented a missed opportunity to leverage the full potential of its regional situation.  The failure to act regionally for economic development goes well beyond the Amazon proposal, however.''

From Chris Steele, COO and president (North America) of Investment Consulting Associates, Worcester. One of 238 first round proposals  to try to lure Amazon's "Second Headquarters'' that was eliminated.

From "Righting the Wrongs of Amazon,'' in City Lab.  To read it, please hit this link.

 

Katie Parker: Amazon shuts out local businesses

 

Via OtherWords.org

The billions in tax breaks cities, including Boston, are offering Amazon to host its “HQ2,” Amazon’s bare-knuckled push to squash a business tax in Seattle, and recent strikes for better working conditions in Amazon facilities have all fueled a growing conversation about the retail behemoth’s toll on communities.

But one element of Amazon’s business strategy has fallen under the radar, and this one could really bite where you live: its bid to dominate local government purchasing.

In January 2017, Amazon won a contract with U.S. Communities, a purchasing cooperative made up of government agencies, school districts and other public or nonprofit agencies. The cooperative wields the heft of its more than 55,000 members to negotiate better prices. With this contract, they can now opt to buy their goods through Amazon Business, which advertises greater product selection, free shipping, and pricing discounts.

While the contract is a big boon for Amazon — a potential for $5.5 billion in sales over 11 years — recent analysis from the Institute for Local Self Reliance (ILSR) seriously questions how good a deal the public is getting out of this.

For one thing, the Amazon contract lacks the pricing protections that are usually standard in public procurement. Rather than relying on a catalog of fixed prices, governments are at the whim of Amazon’s dynamic pricing model, much like the “surge pricing” of ride-sharing services.

The Amazon contract also makes it harder for agencies to buy from local vendors. ILSR notes that while local businesses can join Amazon’s Marketplace to compete for U.S. Communities contracting opportunities, Amazon takes a 15 percent cut. That’s enough, given the already thin margins of public procurement, to push many local businesses out of the running.

For the 1,500 members that have signed onto this contract so far, that means a significant missed opportunity to help their local economies thrive. The good news is that a growing number of governments and nonprofits are realizing that getting the lowest bid isn’t the same as getting the best deal.

Local governments spend money every day. They can use that spending to build up local businesses, create jobs for residents, and grow their tax base, something impossible to do with Amazon’s virtual footprint. This purchasing strategy is more efficient, too: Dollars spent at independent local businesses recirculate at a greater rate than money spent at national chains, creating a multiplier effect.

By shifting their everyday spending, city governments from Phoenix to New Orleans are joining hospitals, universities, and other anchor institutions to spark inclusive economic growth.

Cleveland is a great example. There, local anchor institutions like the Cleveland Clinic and University Hospitals helped launch Evergreen Cooperatives, a network of worker-owned businesses established to provide some of the goods and services these institutions routinely need, such as laundry services and food.

The businesses have an explicit goal of hiring local residents facing barriers to employment, and the cooperative structure gives these workers opportunities to participate in decision-making and build wealth through profit-sharing. Evergreen Cooperatives employs more 220 residents and is growing.

Local governments weighing whether to sign on to Amazon’s marketplace should consider this growing movement around inclusive, local procurement. Instead of being lured by Amazon’s come-on of lowest-price promises, stewards of local tax dollars should ask what would bring the best value for their communities.

Instead of going into Amazon CEO Jeff Bezos’s deepening pockets, the money they spend on goods and services should help everyday residents build wealth.

Katie Parker is a research associate at the Democracy Collaborative with a specialty in how health care institutions can support inclusive economic development. 

Executive challenge

Atul Gawande, M.D.

Atul Gawande, M.D.

From Robert Whitcomb's "Digital Diary,'' in GoLocal24.com

Atul Gawande, M.D., is a fine surgeon, writer, charming public speaker and teacher who became famous writing about the extreme inequities of health-care provision and cost in America. His main statistical tools were developed by the Dartmouth (College) Institute for Health Policy and Clinical Practice.

Now he has been tapped to be CEO of a still somewhat mysterious health-care venture formed by the far-too-big Amazon, giant conglomerate Berkshire Hathaway and JPMorgan, the behemoth bank.  The companies haven’t yet presented a specific plan for the new nonprofit enterprise, which hasn’t even been named yet.  But the main mission is to cut health-care costs for employers.

 
The good economic news for New England is that this outfit, which I suppose could become very big itself, will be based in Boston.

"I have devoted my public health career to building scalable solutions for better healthcare delivery that are saving lives, reducing suffering, and eliminating wasteful spending both in the U.S. and across the world. Now I have the backing of these remarkable organizations to pursue this mission with even greater impact for more than a million people {who work for the three companies}, and in doing so incubate better models of care for all. This work will take time but must be done. The system is broken, and better is possible," Gawande said.

The system is indeed broken, but can this rock star  run a very large organization?

Good news for brick and mortar

Vacant mall in Arizona, emptied by Amazon.

Vacant mall in Arizona, emptied by Amazon.

From Robert Whitcomb's "Digital Diary,'' in GoLocal24.com

The U.S. Supreme Court’s ruling (South Dakota v. Wayfair) that Internet retailers be made to collect sales taxes in states where they have no physical presence is good news for what’s left of physical stores and downtowns in many places. Because of earlier legal actions, Rhode Island and Massachusetts are unlikely to be affected much by the ruling.

The Government Accountability Office says that states were already collecting about 75 percent of the potential taxes from online purchases.  Still, the part not being taxed could be as much as $13 billion a year nationally.

It has been unfair that a god-awful 1992 ruling let online retailers based far away from most of their consumers avoid paying the local and state sales taxes needed to help pay for public services while stores that directly served local customers and employed local people have had to levy these taxes,  of course making their prices less competitive.

Kudos to the 40 states and the Trump administration for suing to overturn a ruling that both violated states’ rights and made for a very unlevel playing field for retailers.

Jim Hightower: Trump's bid to use Postal Service to hit Amazon may backfire big time

Photo by Chensiyuan    Close up of the James A. Farley Post Office,  in Manhattan. Read the inscription over the columns:  " Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds''

Photo by Chensiyuan

Close up of the James A. Farley Post Office,  in Manhattan. Read the inscription over the columns: "Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds''

Via OtherWords.org

The U.S. Postal Service has 30,000 outlets serving every part of America. It employs 630,000 people in good middle-class jobs. And it proudly delivers letters and packages clear across the country for a pittance.

It’s a jewel of public-service excellence. Therefore, it must be destroyed.

Such is the fevered logic of laissez-faire-headed corporate supremists like the billionaire Koch brothers and the right-wing politicians who serve them.

This malevolent gang of wrecking-ball privatizers includes such prominent Trumpsters as Treasury Secretary Steve Mnuchin (a former Wall Street huckster from Goldman Sachs), and Budget Director Mick Mulvaney (a former corporate-hugging Congress critter from South Carolina).

Both were involved in setting up Trump’s shiny new task force to remake our U.S. Postal Service. It’s like asking two foxes to remodel the hen house.

Trump himself merely wanted to take a slap at his political enemy, Amazon chief Jeff Bezos, by jacking up the prices the Postal Service charges to deliver Amazon’s packages. The cabal of far-right corporatizers, however, saw Trump’s temper tantrum as a golden opportunity to go after the Postal Service itself.

Trump complained about the Postal Service not charging Amazon enough for mailing packages. But instead of simply addressing the matter, the task force was trumped-up with an open-ended mandate to evaluate, dissect, and “restructure” the people’s mail service — including carving it up and selling off the parts.

Who’d buy the pieces? For-profit shippers like FedEx, of course. But here’s some serious irony for you: The one outfit with the cash and clout to buy our nation’s whole postal infrastructure and turn it into a monstrous corporate monopoly is none other than… Amazon itself.

I’d prefer my neighborhood post office, thanks. To help stop this sellout, become part of the Grand Alliance to Save Our Public Postal Service: www.AGrandAlliance.org.

Jim Hightower, an OtherWords columnist, is a radio commentator, writer and public speaker. He’s also editor of the populist newsletter, The Hightower Lowdown

 

Would Amazon help improve the MBTA?

In Boston's Seaport District, a candidate for Amazon's  "Second Headquarters.''

In Boston's Seaport District, a candidate for Amazon's  "Second Headquarters.''

From Robert Whitcomb's "Digital Diary,'' in GoLocal24.com

With the announcement that Amazon will hire at least 2,000 more people for its Boston operations – and maybe 50,000 more there if it chooses the city for its “Second Headquarters’’ – it’s nice to know that the online mega-retailer has been talking with people in candidate cities about affordable housing and traffic/transit issues that would be raised by so many new people.

In the case of Boston, have the city and company discussed, for example, Amazon helping to pay for the additional MBTA service needed if the company builds the Second Headquarters there, and  helping to finance a lot of new housing to limit the rise in living costs in what is one of America’s most expensive places? Considering the huge tax incentives offered in order to lure the company, those questions are fair.

Whole Foods centralizes away the local

480px-Supermarkt.jpg

From Robert Whitcomb's "Digital Diary,'' in GoLocal24.com

GoLocal’s March 28 story headlined “Amazon Is Slashing Jobs at Whole Foods in New England Region’’ is an unsettling sign of the times. The story was instigated by a Business Insider article that said: “Whole Foods is slashing regional and in-store marketing and graphic-design jobs in its latest push to centralize operations, say people with knowledge of the matter….It’s not clear exactly how many jobs will be affected….”

GoLocal reports that “the impact locally is that the hand-drawn blackboard signage will disappear and local advertising promotions with {nonprofit} community organizations may go away.’’’ On the East Side of Providence there are two Whole Foods stores and a somewhat similar high-end supermarket called Eastside Marketplace, formerly locally owned but now owned by Ahold, a Dutch company but which heavily promotes local ties. Will Amazon/Whole Foods’ centralizing drive push customers there?

(Trump is correct to say that Amazon has too much power, although he may be mostly driven by his fear and hatred of The Washington Post, which is owned by Amazon CEO Jeff Bezos.)

For Greenfield storeowners, Amazon much tougher foe than Walmart

Greenfield in 1917, around its commercial heyday.

Greenfield in 1917, around its commercial heyday.

From Robert Whitcomb's "Digital Diary,'' in GoLocal24.com

'The Atlantic had a good article (“A Small Town Kept Walmart Out. Now It Faces Amazon,’’ March 2) about Greenfield, a town in western Massachusetts.

Greenfield has managed to keep big-box retailers out of town in order to preserve locally owned stores. But now local store owners and consumers who want to keep them are fighting a bigger enemy – Amazon. The behemoth online retailer offers a convenience that’s very difficult to compete against. Alana Semuels writes:

“Greenfield and other towns across New England are learning that while they might have been able to keep out big-box stores through zoning changes and old-fashioned advocacy, there’s not much they can do about consumers’ shift to e-commerce. They can’t physically keep out e-commerce stores—which don’t have a physical presence in towns that residents could push back against—and they certainly can’t restrict residents’ Internet access. ‘It’s one thing for me to try and fight over land use in the town I live in, or in somebody else's town,’  {local leading} big-box foe {Al} Norman told me, ‘But e-shopping creates a real problem for activists, because on some level, shopping online is a choice people make, and it’s hard to intrude yourself in that.”’

Beyond the demise of local business that keep much of their revenues in their area,  there’s a hollowing out of local civil society as people have fewer opportunities to meet in local  stores; there are fewer of them as more and more folks order more and more products from home or office. As the Internet society heads toward its fourth decade, we’ll need to find different ways to encourage locals to meet and to participate in their community other than, say, joining AA.

To read The Atlantic’s article, please hit this link:



 

Now it's Apple's turn to ask localities for a huge handout

Apple headquarters in Cupertino, Calif., in Silicon Valley.

Apple headquarters in Cupertino, Calif., in Silicon Valley.

Adapted From Robert Whitcomb's "Digital Diary,'' in GoLocal24.com

Apple says it plans to build another corporate campus. It also says it will hire another 20,000 workers, in  part because of the new U.S. tax law, which cuts corporate income taxes. (Not all of the windfall will go to investors in the form of stock buybacks and dividend increases!)_

Of course, Apple’s announcement means that various cities and states around America are already looking into how they can bribe the Cupertino, Calif., company to build its new campus in their jurisdiction. Presumably vast tax breaks, to be subsidized by the individuals and businesses already there,  will be offered, along with very expensive physical-infrastructure improvements. As with Amazon, Greater Boston (which you might say now sort of includes northern Rhode Island) would be in the running because of the huge technology complex there. But would such legal bribery be worth it for the macro-economy of Greater Boston?

Local politicians’ and some business leaders’ obsession with luring huge, rich, sexy tech companies may be popular in the short term but the diversion of so many public resources to a few extremely profitable big companies could have a very big long-term cost. The problems of General Electric that were revealed after it was lured to set up its headquarters in Boston  provide a useful caution sign.

 

Jim Hightower: Bribing big firms to lure them to your area is a fool's game

"Eve Tempted by the Serpent,.''   by  William Blake .

"Eve Tempted by the Serpent,.'' by William Blake.

Via OtherWords.org

Governors and mayors insist that giving our tax dollars to corporations to lure them to move to our cities is good public policy. The corporations create jobs, those workers pay taxes, and — voila! — the giveaway pays for itself!

Does it really work that way? Unfortunately, no.

Good Jobs First tracked the 386 incentive deals since 1976 that gave at least $50 million to a corporation, then tallied the number of jobs created. The average cost per job was $658,427 — each! That’s far more than cities and states can recover through any kinds of taxes those jobholders would pay in their lifetimes.

The rosy job-creation claims by incentive dealmakers also tend to be bogus, because they don’t subtract the number of jobs lost as a result of these deals.

Amazon, for example, has leaned on officials in every major metro area to subsidize its creation of a nationwide network of warehouses, data centers and other facilities.

In a 2016 report titled “Amazon’s Stranglehold,” the Institute for Local Self-Reliance found that more than half of Amazon’s facilities had been built with government subsidies. And Good Jobs First found that since 2005, Amazon has received more than $1 billion from taxpayers to build their private business.

Each handout was made in the name of local workers — and, yes, Amazon does employ thousands. But the subsidies enable the retail giant to undercut local, unsubsidized competitors, driving them out of business and causing devastating job losses that greatly outnumber jobs gained.

The Institute reports that at the end of 2015, Amazon employed 146,000 people in its US operations. But the taxpayer-supported giant had meanwhile killed some 295,000 U.S. retail jobs.

Check out the report for yourself at ilsr.org/amazon-stranglehold.

Jim Hightower is a radio commentator, writer, and public speaker. He’s also the editor of the populist newsletter, The Hightower Lowdown. 

Jim Hightower: Jeff Bezos wants the key to your house

Amazon is watching you.

Amazon is watching you.

Via OtherWords.org

Would you give your house key to a complete stranger, letting that person (whose name you don’t even know) walk right into your home when you’re not there?

One stranger who’s brazenly asking you and millions of other people to do just that is Jeff Bezos.

He’s the head honcho of Amazon, the e-commerce behemoth whose vast supercomputer network routinely compiles and stores dossiers on every one of his customers. He’s obsessed with having the most data on the most people — it’s a little creepy.

Now, adding to the creep factor, Bezos literally wants Amazon to get inside your home. And, ironically, he’s using “security” as his rationale.

Rather than simply delivering the products you order from Amazon to your doorstep, the corporation wants a key to unlock your door, allowing its delivery crews to go inside and do you the favor of placing the packages securely in your abode.

What could possibly go wrong with that?

Other than you being robbed, of course, either by rogue Amazon employees or by hackers who will certainly gain access to the corporation’s computerized key codes. Or maybe “Crusher,” your pitbull, mauls the Amazon intruder and you get sued.

Need I mention that Bezos expects you to pay for the privilege of having his employees enter your home? First, his dicey, open-sesame program, which he calls “Amazon Key,” is available only to customers who shell out $99 a year to be “Amazon Prime” members.

Second, you must buy a special Internet-unlocking gizmo and a particular camera to join his corporate key club. And guess where you must go to buy this entry technology? Yes, Amazon — where prices for the gizmo and camera setup start at $250.

This is Jim Hightower saying… What a deal! For Amazon, that is.

Bezos’s  real goal — indeed, his only goal, always — isn’t so much to get inside your home. It’s to get inside your wallet.

Jim Hightower is a radio commentator, writer, and public speaker. He’s also the editor of the populist newsletter, The Hightower Lowdown.

 

A behemoth company and democracy

"Amazon preparing for a battle,'' by Pierre-Eugène-Emile Hébert, at the  National Gallery of Art ,  in  Washington, D.C.

"Amazon preparing for a battle,'' by Pierre-Eugène-Emile Hébert, at the National Gallery of Art,  in Washington, D.C.

Adapted from "Robert Whitcomb's "Digital Diary,'' in GoLocal24com:

Rhode Island Gov. Gina Raimondo promised in her well-intentioned pitch to Amazon to build its “second headquarters’’ in the state that  “You’d {Amazon} have the access, influence and impact that comes from being a dominant employer in our state.’’

This (along with a bizarre rendering showing Amazon buildings taking over much of the area around the State House) is a tad chilling. Does a tiny state want to take orders from some huge company?

Of course it would be very nice to get some Amazon jobs. With Boston a leading (and perhaps the leading) candidate to get the company’s second headquarters, perhaps Greater Providence could get some spillover employees from  the behemoth online retailer, especially in  such specialties as design, in which Rhode Island has particular strengths. But it’s dangerous for democracy and long-term, steady economic growth to be at the beck and call of one huge company. Better 50 small and medium size companies than one huge quasi-monopoly.  Big company means big hiring but also eventually big layoffs.

Some Amazon executives are reportedly pushing hard for Boston to be the second headquarters. To learn more, please hit this link:

https://www.cnbc.com/2017/09/12/amazon-execs-want-second-hq-in-boston-says-report.html

 

Jim Hightower: Push back against arrogant Amazon

"Battle of the Amazons,'' by Peter Paul Rubens.

"Battle of the Amazons,'' by Peter Paul Rubens.

Via OtherWords.org

Isn’t it funny that right-wing politicians across America piously rant against giving a few bucks worth of jobless benefits to the needy — then turn around and shove billions of our tax dollars into corporate welfare for the greedy?

You’re right. It’s not funny. But here we go again.

We’re witnessing the most disgusting spectacle yet of the politico-corporate cabal extracting money from the people’s wallets to  further enrich themselves.

Amazon.com, the $136-billion-a-year Internet colossus, has initiated a sleazy, self-serving public bidding war over where it will locate its new corporate headquarters. The city and state that offer the most bribe money to this private enterprise will be “the winner.” {Boston and Providence are among the bidders.}

Uber-rich Amazon doesn’t need — and certainly doesn’t deserve — any public handout. But officials in 238 cities have prostrated themselves in front of this Amazonian welfare queen in embarrassing bids to win her nod.

Amazon’s arrogant executives even sent out a list of basic benefits they expect every applicant to deliver, including a “business-friendly environment and tax structure,” free land, a subsidy to reduce its operational costs, tax breaks, relocation grants for executives and workforce, reduced utility bills, and — oh yeah, also give us first-rate schools and an educated labor pool.

As one analyst of Amazon’s bribery scheme noted, “These incentives aren’t free. There’s no fairy godmother paying for them.”

The typical result of corporate giveaways is that they cost the public more than we get back. By demanding such corporate spoils, Amazon brands itself a common thief, not only taking our money, but also stealing our trust in the fairness of the system and widening inequality in our society.

To help stop this corruption, go to GoodJobsFirst.org.

Jim Hightower is a radio commentator,  writer and public speaker. He’s also the editor of the populist newsletter, The Hightower Lowdown. 

 

Chris Powell: Amidst current sexual-abuse scandals, prurience is a growth industry; 'fake media' love Trump's pro-monopoly FCC

peep.jpg

MANCHESTER, Conn.

Suddenly it seems as if everyone has been sexually abused or worse by someone else. But it only seems to be sudden. In fact it has been going on since sex was discovered by people who had power over other people. It has become fashionable to declaim about it only recently, thanks to mass media that increasingly profit less from useful information than from mere prurience, which seems to be what most people want most these days, after sex itself.

What has this phenomenon really proved? Not much -- maybe two things.

First, that power still corrupts, most of all in regard to sex, and that its victims ordinarily keep silent about it to avoid embarrassment except when going public long afterward can unhorse a perpetrator who has achieved some high position. Then the victim's enjoyment of revenge outweighs embarrassment and may signify a sort of corruption itself.

And second, that a contemporaneous complaint to the police or at least the perpetrator's acquaintances is worth any number of belated and merely vengeful complaints. For a contemporaneous complaint can stop an abuser before he makes a career out of it.

The movie industry was infamous for this corruption long before Harvey Weinstein began taking advantage of the casting couch. Back in 1955, having spent two years as a screenwriter in Hollywood, Norman Mailer novelized about it well in The Deer Park, concluding that the world was a place "where orphans burn orphans and nothing is more difficult to discover than a simple fact." 

Having married six times, Mailer himself turned out not to be such a nice guy either. Maybe it took one to know one.


RACKETEERING ISN'T INNOVATION: To lure Amazon's second headquarters, Connecticut has joined nearly every other state and dozens of cities in offering the company billions of dollars. Amazon is to be exempted from state and municipal taxes for many years while the company strives to put other retailers out of business even though they  do  pay state and municipal taxes. 
 
It's as if the retail business isn't hard enough already. Indeed, the site that the town of Enfield, Conn., is pitching to Amazon is the Enfield Square shopping mall, which used to house the major department stores Amazon has undermined. Now Enfield Square is struggling.

Other retailers and businesses generally should respond to the Amazon frenzy by demanding similar payoffs just to stay put. 

Amazon justly profits from its innovation in internet retailing but its original innovation was only to enlarge sales-tax evasion. Now the company wants direct subsidy from government. That's a racket.



‘FAKE MEDIA' LOVE TRUMP'S FCC: While President Trump rants about "fake news" from the "fake media," his Federal Communications Commission is planning to repeal regulations so that media companies can become even bigger and concentrate ownership of television and radio stations and newspapers.

The FCC, which now has a Republican majority, aims to let companies combine ownership of television and radio stations and newspapers in the same market and to let TV stations absorb each other even if doing so would leave a market with fewer than eight stations.

The commission already has repealed a rule requiring TV and radio stations to have offices in the communities they are licensed to serve.

Government policy should diversify and democratize ownership of the news media and the whole economy, not concentrate it. Concentrating ownership of the news media just makes "fake news" and propaganda easier to spread. Trump's "fake media" love his FCC. 


Chris Powell is managing editor of the Journal Inquirer, in Manchester, Conn.

 

Desperately chasing business

From Robert Whitcomb's "Digital Diary,'' in GoLocal24.com:

Worcester is putting in its own bid to get Amazon’s “second headquarters’’ in addition to being part of the  Massachusetts  application to the Seattle-based monster. Not a bad idea – two lottery tickets instead of just one.  But it is hard to see Worcester having the infrastructure, techno personnel and tax-break resources to lure Amazon and what the company asserts will be 50,000 new employees. Maybe, like Providence, they could get a couple of small slices of the pie if Amazon picks Boston. (I still bet on Austin.)

xxx

I ask again: Why does Massachusetts, a rich state, refuse to help pay to build sports stadiums for private companies while much poorer Rhode Island is looking to cough up such money for the Pawtucket Red Sox?

Will Amazon spawn old-fashioned Main Street retailing?

"View of Manchester, Vermont,  ''  by DeWitt Clinton Boutelle (1870)

"View of Manchester, Vermont, '' by DeWitt Clinton Boutelle (1870)

From Robert Whitcomb's "Digital Diary,'' in GoLocal24.com:

What will become of cities as more and more work is done on the Internet and more and more stuffis delivered by mail (and drones?). At first glance you might think that these changes will hollow out the cities.

But people seek respite from screens and, for that matter, much paid work will continue to be done off screen.  Consider that big growth areas for future jobs include such trades as electricians, plumbers, roofers, linemen, etc.

Seeing people in the flesh, not just virtually, will become more attractive as we become sated with screen life. Indeed, it’s essential for good health. And important decisions will continue to be best completed, and new ideas most cogently expressed, in real encounters. That’s one reason  that Manhattan still thrives, in spite of its high costs.  You can’t do a merger deal online. You have to meet in person.

Young adults, especially those with children, will continue to move to, or stay in, the suburbs, but future suburbs will look different from ‘50s- and ‘60s-style subdivisions.  For one thing,  they will have dense, very walkable centers for shopping, distribution and entertainment, and, especially, meeting people, with many smaller specialty stores in place of the vast malls and even vaster windswept parking lots around them. There will be fewer ugly big-box stores because so much of their brand-name stuff will be shipped directly to customers via Amazon, etc.

Highly specialized stores, many with unique items – some of them locally made ---can do well in these suburbs-becoming-mini-cities within broader metro areas. They’ll be staffed by salespeoplevery knowledgeable about their products and services and with long-term relationships with customers.  

The Boston Globe reports: “Credit Suisse has predicted that upwards of a quarter of the 1,200 malls in America will close in the next five years.’’

“Today, if you know what you need, you go to Amazon and buy it,’’ Pam Danziger, president of the Pennsylvania-based Unity Marketing, told The Globe. “Where you’re going to find interest is on Main Street and not in these homogeneous same-old, same-old outlet stores. Main Street — where people really know you — that’s where the future of retail is.’’

Read the highly instructive case of  toney Manchester, Vt., suffering from the decline in shopping at its many national chain outlets and so now looking to go more local. Please hit this link:

https://www.bostonglobe.com/metro/2017/09/15/there-app-for-this-retail-town-suffers-age-commerce/uArZDDp6UX5lzQlB0nsciP/story.html

Meanwhile, the car culture, even in the suburbs, will probably continue to fade with further proliferation of such ride-sharing services as Lyft and Uber and the expansion and diversification of mass transit associated with our aging population and environmental concerns.

Some suburbs are starting to look like center cities. Consider Tysons Corner, in suburban Fairfax County, Va., outside of Washington.  Tysons looms like a mini-Manhattan, with office and residential towers. And then there are the small old cities within broader metro areas, of which there are many in New England – think Concord, N.H. and Portland, Maine. I think that they’ll grow as people seek the conveniences of more than traditional suburban density but without the costs of living in such big cities as Boston and New York, whose centers are increasingly for the rich.

Relatively new  suburban places such as Tysons are called“edge cities’’ . But we’ve got what are small  old “edge cities’’ around here, such as Pawtucket, R.I., which might have the urban bones to become more lively and prosperous.

Then there are the mid-size cities, such as Providence, Worcester and New Haven. They’ll draw people with their commercial and cultural attractions but won’t have the critical mass to become big cities. Rather, they’ll be ancillaries that will perform some of the services provided in nearby big cities -- e.g., Boston and New York. They’ll continue to lure folks who want to live in real cities but want/need somewhat less density and considerably lower costs than in Boston and New York.

Even Hartford, now an urban disaster area, ought to be able to eventually turn itself around and market its assets (especially its riverfront) as well as, say, Providence has done with its advantages.

Then there will be new mini-metro areas far away from big cities. One is the Lebanon, N.H.-Hanover, N.H.-White River Junction in the Upper Connecticut River Valley. There, the intersection of two major Interstate highways – Routes 89 and 91 -- along with the presence of a well-known university (Dartmouth College) and associated large medical center has for several decades been creating a kind of city – still sprawling but gradually being pulled together by, among other things, public transportation (encouraged by the proliferation of facilities, many of them high-end, for the elderly in areas with major colleges and medical centers).

New England, with its many still well functioning towns and small cities with an almost European settlement pattern, would seem well placed to benefit from the technological and behavioral changes roiling the country,  the sprawling , utterly car-dependent  metro areas of much of the Sunbelt and Middle West less so.  People will continue to seek community. At leastin New England that will be easier to find and/or rebuild than in most of the country.