Amazon Is On The President's Hit List, But What Will Become Of It?
President Donald Trump has made it clear in recent days, through his usual medium of Twitter, that he believes Amazon is harming the U.S. economy.
He expressed particular concern regarding physical retailers inability to keep pace with Jeff Bezos' behemoth, in addition to criticizing its use of the U.S. Postal Service.
Many of these complaints are not new, such as Trump's claims that Amazon has an unfair competitive advantage because e-commerce operations have not been required to collect state or local sales taxes. That has long been a bone of contention between physical and Internet retailers, and though Congress has raised similar concerns, nothing has been addressed yet.
Because Amazon's network of warehouses is so extensive, it does collect sales taxes in states that have a sales tax. If the law changes, presumably other Internet retailers would feel the pinch.
The president also has floated the idea that the ailing U.S. Postal Service is a "delivery boy" for Amazon, and is losing money on the many packages that it delivers for the online retailer.
Reacting to criticism that asserts that the USPS is actually making money from Amazon, and really needs Amazon as a customer, the president stuck to his guns.
I am right about Amazon costing the United States Post Office massive amounts of money for being their Delivery Boy. Amazon should pay these costs (plus) and not have them bourne by the American Taxpayer. Many billions of dollars. P.O. leaders don’t have a clue (or do they?)!
— Donald J. Trump (@realDonaldTrump) April 3, 2018
What will be the fallout from the fight that Donald Trump has picked with Amazon? Forbes detailed a number of possibilities.
Sales Tax. A change in sales tax for online retailers is possible if Congress takes action, but as mentioned above, that is not likely to harm Amazon.
The Post Office. It is not clear what the president wants to do to help the USPS be less of a "delivery boy," though that would possibly mean charging more for deliveries. That kind of charge tends to be passed on to consumers.
Retail Apocalypse. Retailers have cut jobs and closed stores in recent years, and while arguably Amazon is responsible for some or even much of that, retail remains the nation's largest private sector employer, with about 29 million jobs, according to the National Retail Federation. Also, in a near full-employment economy, it is hard to argue that retail employees who lose their jobs have nowhere else to go.
The Washington Post. The president has complained a lot recently about the Post, which Jeff Bezos acquired not so long ago. So it is possible that his criticism of Amazon stems more from his animosity toward the newspaper than anything the retailer is doing.
...does not include the Fake Washington Post, which is used as a “lobbyist” and should so REGISTER. If the P.O. “increased its parcel rates, Amazon’s shipping costs would rise by $2.6 Billion.” This Post Office scam must stop. Amazon must pay real costs (and taxes) now!
— Donald J. Trump (@realDonaldTrump) March 31, 2018
In any case, Axios reports, the president has "wondered aloud if there may be any way to go after Amazon with antitrust or competition law," adding that "he doesn’t have a plan to make that happen."
