10 ms·

I am a European Amazon customer and I have had enough. Amazon is a heavily subsidized corporation. It operates from a tax shelter (Luxembourg). It underpays it

by flexie 13y ago

I am a European Amazon customer and I have had enough. Amazon is a heavily subsidized corporation. It operates from a tax shelter (Luxembourg). It underpays it's American staff (who are then receiving US welfare as supplement in order to survive). Giving away delivery for free is a form of predatory pricing. In general, large market players have been banned from predatory pricing under European competition law for decades. Competition is great but let's not pretend that Amazon is outcompeting other (online) bookstores fair and square.

jbooth 13y ago
If we're being completely fair, Amazon's willingness to run in the red for almost 20 years and continually sacrifice profits for market share probably has a lot to do with their prices, too. But your points are worth noting, and Americans might feel a little differently if it was a foreign corporation.
jzwinck 13y ago
Which American Amazon.com employees are receiving US welfare checks? I tried to locate a source for this claim, but came up short.
- throwaway9101 13y ago
  Possibly an exaggeration, but OP is probably referring to the workers who run Amazon's fulfilment centers.
  - seanmcdirmid 13y ago
    Those fulfillment centers serve Europe?
- jbooth 13y ago
  It's not Amazon employees, actually, their warehouses are staffed by those terrible day-labor contract places where people show up and wait for hours unpaid to find out if they get to work for minimum wage later in the day. I've seen a lot of sources for Wal-Mart employees under similar pay levels. It was SNAP, TANF and Medicaid primarily, not so much 'welfare'. Still a sizable subsidy, and a decent % of those people's ultimate pay/benefit package.
  - jzwinck 13y ago
    Do you have a source regarding the day laborers who wait for hours seeking work for minimum wage? Because an article your sibling posted, which is critical of Amazon, says warehouse workers get $11 per hour (about 50% more than minimum wage). Outside of major cities, that seems like an OK wage for a fairly straightforward job. If it's not, why don't you raise the minimum wage?
    - jbooth 13y ago
      You're right, it seems they pay $11. I had gotten that info about the day-contracting centers from other places that they staff, at some point. And I personally agree with raising the minimum wage, although not any higher than $11, probably, so that's immaterial. That's still hard to make a living on at 40 hours and no benefits, though. And it is unfair to competitors who pay a more livable wage without forcing their employees to get on medicaid.
      - deleted 13y ago
        [deleted]
  - mc32 13y ago
    I have heard about day laborers lingering around HomeDepot, etc., hoping to land a stint with contractors (builders) who happen to make materials purchases at HomeDepot, etc. but never heard of Wal*Mart, HomeDepot, etc. hiring these people to work in their businesses.
  - walshemj 13y ago
    They are talking about things like the working tax credit https://www.gov.uk/working-tax-credit/overview https://www.gov.uk/working-tax-credit/overview As a Tax payer in the UK I am not happy about subsiding a profitable companies work force
- janesvilleseo 13y ago
  I believe this is in reference to those who work in the warehouses. Amazon uses a large number of tempory workers, which limits the number of hours available and the ability to become ft. This article may provide a better overview: http://www.businessinsider.com/brutal-conditions-in-amazons-warehouses-2013-8 http://www.businessinsider.com/brutal-conditions-in-amazons-...
spongle 13y ago
That's basically the point of globalisation though isn't it?
dionidium 13y ago
Your definition of fair and square is weird to me. If other companies pay their employees more than Amazon, then it must mean that they think they gain some competitive advantage from that. If that turns out not to be true, then, assuming they're a US company, they operate in the same legal climate as Amazon and can pay their employees Amazon-scale rates rather than shutdown. If they do that and still lose, then your argument seems to fall apart. Look, Prime is genius, their prices are ridiculously low, their return policy is more than generous, and as long as their shareholders are happy to subsidize me, the consumer, I'll probably never get enough.
- jbooth 13y ago
  As a happy Amazon customer: That line is bullshit. Employment law exists for a reason, we don't just accept "oh, that's what the market will bear" for things like unsafe working conditions or workplace sexual harrassment. Europeans feel that underpaying your employees to the point where they rely on welfare programs to subsidize their paycheck is not only wrong (that's fine, life's not fair) but distorted and not-free-market. I have to agree with them on the distortion part.
  - GeorgeOrr 13y ago
    Just to bring things back to the article in question ... this law being passed has nothing to do with fair labour pay or practice. It just makes sure that customers aren't allowed to get 5 percent discounts and free shipping.
  - dionidium 13y ago
    I was careful to say, "assuming they're a US company," because I was trying to point out that, yes, employment law exists for a reason, but Amazon's competitors operate under the same employment laws as Amazon. In fact, I said this explicitly. Edit: Maybe you're trying to say that Amazon's competitors pay their employees more than Amazon because they have bigger hearts and are willing to crash their businesses before paying (legal, but unfair) low wages. That's a pretty big claim that requires some evidence. I think it's more likely that they are losing for other reasons.
wuliwong 13y ago
I am absolutely opposed to governments subsidizing corporations but I am equally opposed by attempts to offset it with more bureaucracy and market manipulations. I understand that this is a US vs. France thing but it doesn't change this for me. I would be in total opposition to special legislation for products produced in China by government subsidized companies; a very similar situation.
liber8 13y ago
>>Giving away delivery for free is a form of predatory pricing<< This line of reasoning always amused me. Free = predatory? Can someone explain how one arrives at this logic? If the thinking is that "free" leads to "monopoly" which then leads to dramatically increased pricing once all competition is eliminated, this has absolutely, empirically and historically, been shown to be false. It simply never happens. Or more accurately, if/when it has been attempted, this practice has swiftly been defeated by competition. Edit: An afterthought: If free = predatory pricing, why do we allow charities to distribute free shelter, goods, and food? Surely these institutions are displacing some sales that would otherwise take place, thus negatively impacting those businesses that would otherwise have profited from those sales?
- rtpg 13y ago
  >If the thinking is that "free" leads to "monopoly" which then leads to dramatically increased pricing once all competition is eliminated, this has absolutely, empirically and historically, been shown to be false. It simply never happens. Or more accurately, if/when it has been attempted, this practice has swiftly been defeated by competition. Unlimited data plans in the US (or almost everywhere else) is where this has happened
  - liber8 13y ago
    I don't follow. In the US, we went from ridiculously expensive per minute plans 10 years ago to unlimited, nationwide calling for a pretty low flat-fee per month. This seems to be the opposite of predatory pricing... US Telecom in general is an interesting example because it's one of the few industries that typically do soak consumers, because of what essentially amount to government enforced monopolies.
    - r00fus 13y ago
      Yes, because we broke up AT&T. Before that, AT&T was pushing that you had to not only buy lines, but the phones from them as well. Perhaps this was before your time, but there's a reason that Cap'n Crunch and blue box pirates like Jobs/Wozniak had appeal - the alternative was monopoly pricing.
alyandon 13y ago
What exactly is your evidence that Amazon Fulfillment (I'm assuming) underpays people here in the US? My ex-wife here in Texas (a state that is not known for "worker friendly" laws) works in one of Amazon's distribution centers and makes slightly under $12/hr starting pay with medical benefits, stock, 401k matching, 1.5x + 8 hours holiday pay compensation, etc. All of that paid to someone that has only a high-school equivalence certificate. While she won't get rich working there, she doesn't have to resort to food stamps or other forms of welfare in order to make ends meet.

by flexie 13y ago

jbooth 13y ago

If we're being completely fair, Amazon's willingness to run in the red for almost 20 years and continually sacrifice profits for market share probably has a lot to do with their prices, too. But your points are worth noting, and Americans might feel a little differently if it was a foreign corporation.

jzwinck 13y ago

Which American Amazon.com employees are receiving US welfare checks? I tried to locate a source for this claim, but came up short.

throwaway9101 13y ago
Possibly an exaggeration, but OP is probably referring to the workers who run Amazon's fulfilment centers.
- seanmcdirmid 13y ago
  Those fulfillment centers serve Europe?
jbooth 13y ago
It's not Amazon employees, actually, their warehouses are staffed by those terrible day-labor contract places where people show up and wait for hours unpaid to find out if they get to work for minimum wage later in the day. I've seen a lot of sources for Wal-Mart employees under similar pay levels. It was SNAP, TANF and Medicaid primarily, not so much 'welfare'. Still a sizable subsidy, and a decent % of those people's ultimate pay/benefit package.
- jzwinck 13y ago
  Do you have a source regarding the day laborers who wait for hours seeking work for minimum wage? Because an article your sibling posted, which is critical of Amazon, says warehouse workers get $11 per hour (about 50% more than minimum wage). Outside of major cities, that seems like an OK wage for a fairly straightforward job. If it's not, why don't you raise the minimum wage?
  - jbooth 13y ago
    You're right, it seems they pay $11. I had gotten that info about the day-contracting centers from other places that they staff, at some point. And I personally agree with raising the minimum wage, although not any higher than $11, probably, so that's immaterial. That's still hard to make a living on at 40 hours and no benefits, though. And it is unfair to competitors who pay a more livable wage without forcing their employees to get on medicaid.
    - deleted 13y ago
      [deleted]
- mc32 13y ago
  I have heard about day laborers lingering around HomeDepot, etc., hoping to land a stint with contractors (builders) who happen to make materials purchases at HomeDepot, etc. but never heard of Wal*Mart, HomeDepot, etc. hiring these people to work in their businesses.
- walshemj 13y ago
  They are talking about things like the working tax credit https://www.gov.uk/working-tax-credit/overview https://www.gov.uk/working-tax-credit/overview As a Tax payer in the UK I am not happy about subsiding a profitable companies work force
janesvilleseo 13y ago
I believe this is in reference to those who work in the warehouses. Amazon uses a large number of tempory workers, which limits the number of hours available and the ability to become ft. This article may provide a better overview: http://www.businessinsider.com/brutal-conditions-in-amazons-warehouses-2013-8 http://www.businessinsider.com/brutal-conditions-in-amazons-...

spongle 13y ago

That's basically the point of globalisation though isn't it?

dionidium 13y ago

Your definition of fair and square is weird to me. If other companies pay their employees more than Amazon, then it must mean that they think they gain some competitive advantage from that. If that turns out not to be true, then, assuming they're a US company, they operate in the same legal climate as Amazon and can pay their employees Amazon-scale rates rather than shutdown. If they do that and still lose, then your argument seems to fall apart. Look, Prime is genius, their prices are ridiculously low, their return policy is more than generous, and as long as their shareholders are happy to subsidize me, the consumer, I'll probably never get enough.

jbooth 13y ago
As a happy Amazon customer: That line is bullshit. Employment law exists for a reason, we don't just accept "oh, that's what the market will bear" for things like unsafe working conditions or workplace sexual harrassment. Europeans feel that underpaying your employees to the point where they rely on welfare programs to subsidize their paycheck is not only wrong (that's fine, life's not fair) but distorted and not-free-market. I have to agree with them on the distortion part.
- GeorgeOrr 13y ago
  Just to bring things back to the article in question ... this law being passed has nothing to do with fair labour pay or practice. It just makes sure that customers aren't allowed to get 5 percent discounts and free shipping.
- dionidium 13y ago
  I was careful to say, "assuming they're a US company," because I was trying to point out that, yes, employment law exists for a reason, but Amazon's competitors operate under the same employment laws as Amazon. In fact, I said this explicitly. Edit: Maybe you're trying to say that Amazon's competitors pay their employees more than Amazon because they have bigger hearts and are willing to crash their businesses before paying (legal, but unfair) low wages. That's a pretty big claim that requires some evidence. I think it's more likely that they are losing for other reasons.

wuliwong 13y ago

I am absolutely opposed to governments subsidizing corporations but I am equally opposed by attempts to offset it with more bureaucracy and market manipulations. I understand that this is a US vs. France thing but it doesn't change this for me. I would be in total opposition to special legislation for products produced in China by government subsidized companies; a very similar situation.

liber8 13y ago

>>Giving away delivery for free is a form of predatory pricing<< This line of reasoning always amused me. Free = predatory? Can someone explain how one arrives at this logic? If the thinking is that "free" leads to "monopoly" which then leads to dramatically increased pricing once all competition is eliminated, this has absolutely, empirically and historically, been shown to be false. It simply never happens. Or more accurately, if/when it has been attempted, this practice has swiftly been defeated by competition. Edit: An afterthought: If free = predatory pricing, why do we allow charities to distribute free shelter, goods, and food? Surely these institutions are displacing some sales that would otherwise take place, thus negatively impacting those businesses that would otherwise have profited from those sales?

rtpg 13y ago
>If the thinking is that "free" leads to "monopoly" which then leads to dramatically increased pricing once all competition is eliminated, this has absolutely, empirically and historically, been shown to be false. It simply never happens. Or more accurately, if/when it has been attempted, this practice has swiftly been defeated by competition. Unlimited data plans in the US (or almost everywhere else) is where this has happened
- liber8 13y ago
  I don't follow. In the US, we went from ridiculously expensive per minute plans 10 years ago to unlimited, nationwide calling for a pretty low flat-fee per month. This seems to be the opposite of predatory pricing... US Telecom in general is an interesting example because it's one of the few industries that typically do soak consumers, because of what essentially amount to government enforced monopolies.
  - r00fus 13y ago
    Yes, because we broke up AT&T. Before that, AT&T was pushing that you had to not only buy lines, but the phones from them as well. Perhaps this was before your time, but there's a reason that Cap'n Crunch and blue box pirates like Jobs/Wozniak had appeal - the alternative was monopoly pricing.

alyandon 13y ago

What exactly is your evidence that Amazon Fulfillment (I'm assuming) underpays people here in the US? My ex-wife here in Texas (a state that is not known for "worker friendly" laws) works in one of Amazon's distribution centers and makes slightly under $12/hr starting pay with medical benefits, stock, 401k matching, 1.5x + 8 hours holiday pay compensation, etc. All of that paid to someone that has only a high-school equivalence certificate. While she won't get rich working there, she doesn't have to resort to food stamps or other forms of welfare in order to make ends meet.