{"id":179050,"date":"2018-06-01T18:24:00","date_gmt":"2018-06-01T23:24:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2018\/06\/01\/did-someone-pay-to-suppress-this-essay\/"},"modified":"2018-06-01T18:24:00","modified_gmt":"2018-06-01T23:24:00","slug":"did-someone-pay-to-suppress-this-essay","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2018\/06\/01\/did-someone-pay-to-suppress-this-essay\/","title":{"rendered":"Did Someone Pay to Suppress This Essay?"},"content":{"rendered":"

American Conservative just published, and then apparently unpublished, an essay on how Amazon is one of the most egregious mooches on the government teat<\/a>.<\/p>\n

Luckily, you can still find it at The Internet Archive<\/a>.<\/p>\n

It could be just a computer glitch, but my money is on Amazon CEO Jeff Bezos, or someone close to him, noting that AmCon<\/i> was risking donor money:<\/p>\n

\u2026\u2026\u2026<\/p>\n

Indeed, contra the libertarian ethos that Amazon and its leader purport to embody, the company has not emerged as one of history\u2019s preeminent corporate juggernauts through thrift and elbow grease alone. Although the company\u2019s harshest critics must concede that Amazon is the world\u2019s most consistently competent corporation\u2014replete with innovation and ingenuity\u2014the company\u2019s unprecedented growth would not be possible without two key ingredients: corporate welfare and tax avoidance.<\/span>

<\/span> Amazon has long benefitted from the procurement of taxpayer-funded subsidies, emerging in recent years as the leading recipient of corporate welfare. According to Good Jobs First, a Washington, D.C., organization dedicated to corporate and government accountability, Amazon has, since 2000, received more than $1.39 billion in state and local tax breaks  and subsidies for construction of its vast network of warehouses and data centers. <\/span>

<\/span> \u2026\u2026\u2026<\/span>
<\/span> Amazon\u2019s pursuit of public tithes and offerings is matched by its relentless obsession with avoiding taxes. Employing a legion of accountants and lawyers, the company has become a master at navigating the tax code and exploiting every loophole. Illegality is not the issue here but rather a tax system that allows mammoth corporations to operate with huge tax advantages not available to mom-and-pop shops on Main Street. <\/span>

<\/span> Of course Amazon isn\u2019t unique in its desire to avoid the taxman. It is, however, unrivaled in its ability to do so. Last fall\u2019s debate concerning the merits of lowering the corporate tax rate from 35 percent to 20 percent was, for Amazon, a moot point. In the five years from 2012 to 2016, Amazon paid an effective federal income tax rate of only 11.4 percent. <\/span>

<\/span> The company fared even better in 2017. Despite posting a $5.6 billion profit, Amazon didn\u2019t pay a single cent in federal taxes, according to a recent report from the Institute on Taxation and Economic Policy. What\u2019s more, Amazon projects it will receive an additional $789 million in kickbacks from last year\u2019s tax reform bill. <\/span>

<\/span> Even by the standards of mammoth corporations, this is impressive. By way of comparison, Walmart\u2014no stranger to corporate welfare and tax avoidance\u2014has paid $64 billion in corporate income tax since 2008. Amazon? Just $1.4 billion. <\/span>

<\/span> Amazon\u2019s tax-avoidance success can be attributed to two things: avoiding the collection of sales taxes and stashing profits in overseas tax havens. The IRS estimates that Amazon has dodged more than $1.5 billion in taxes by funneling the patents of its intellectual property behind the walls of its European headquarters city, Luxembourg\u2014a widely used corporate tax haven. Again, nothing illegal here, but there\u2019s something wrong with a tax system that allows it. <\/span>

<\/span> From day one, Amazon\u2019s business model involved legally avoiding any obligation to collect sales taxes,  and then using the subsequent pricing advantage to gain market share. It did this by first locating its warehouses in very few states, most of which did not have a sales tax. It then shipped its goods to customers that resided in other states that did have sales tax. This game plan allowed Amazon to avoid what is known as \u201cnexus\u201d in sales-tax states, meaning that those states could not compel it to collect the tax\u2014a two to 10 percent competitive advantage over its brick-and-mortar counterparts.<\/span>

<\/span> \u2026\u2026\u2026<\/span>
<\/span> It is difficult to overstate how instrumental tax breaks and tax avoidance have been in Amazon\u2019s unprecedented growth. As Bezos made clear in his first letter to shareholders in 1997, Amazon\u2019s business plan is predicated on amassing long-term market share in lieu of short-term profits. As a result, the company operates on razor-thin margins in some retail categories, while actually taking losses in others. <\/span>

<\/span> \u2026\u2026\u2026<\/span>

<\/span> In fact, Amazon\u2019s ascent and tactics have led an increasing number of public policy experts to call for a renewed enforcement of America\u2019s antitrust laws. The concern is that Amazon has used its market power to crush smaller competitors with a swath of anti-competitive practices, including predatory pricing and market power advantages stemming from Amazon Marketplace\u2014Amazon\u2019s vast sales platform for third-party retailers. <\/span><\/p><\/blockquote>\n

Given the amount of pathetic whining we see from the uber*<\/sup>-rich when anyone fact checks what they say (see Musk, Elon), it would be not at all unusual for someone in Bezos’ orbit to take offense and threaten the publishers at what is a fairly obscure (circulation in the mid 4 figures) hetrodox conservative publication.<\/p>\n

It’s also petty and stupid, but that is what these guys are. (See Musk, Elon)<\/p>\n

*<\/sup>Pun not intended.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

American Conservative just published, and then apparently unpublished, an essay on how Amazon is one of the most egregious mooches on the government teat. Luckily, you can still find it at The Internet Archive. It could be just a computer glitch, but my money is on Amazon CEO Jeff Bezos, or someone close to him, …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[365,611,504,374],"class_list":["post-179050","post","type-post","status-publish","format-standard","hentry","tag-business","tag-censorship","tag-philosophy","tag-politics"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/179050"}],"collection":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/comments?post=179050"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/179050\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=179050"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=179050"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=179050"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}