Blind Because We Have Eyes

Five Things You Need to Read Today

1. No Good Deed Goes Unpunished

With a lot of ordinary commerce limited by the coronavirus threat, at least we have companies like Amazon to fall back on, demonstrating how the flexibility and innovation of a capitalist economy can help get us through a crisis.

So naturally, a US senator has chosen this time to launch an attack on Amazon. And of course, since this is 2020, it’s a Republican senator.

Sen. Josh Hawley, R-Mo., is asking the Department of Justice to open a criminal investigation into Amazon, citing reports that he says suggest the company has used “predatory and exclusionary data practices to build and maintain a monopoly.”

Hawley’s request follows Friday’s Wall Street Journal report that said Amazon employees had used data from third-party sellers to rival them with private label products under Amazon’s own brands….

Hawley is asking the Justice Department to investigate Amazon on the basis of Section 2 of the Sherman Antitrust Act. The statute, which was used to prosecute Microsoft in a landmark antitrust case at the turn of the century, prohibits unlawful monopolies, which are firms that rise to dominance or maintain it by suppressing competition. The European Commission has already opened an investigation into the ways Amazon uses data from its sellers….

Amazon’s practices are especially concerning in light of the ongoing pandemic, according to Hawley, who has experience investigating another tech giant. Hawley opened an antitrust probe into Google while attorney general of Missouri.

“Thousands of small businesses have been forced to suspend in-store retail and instead rely on Amazon because of shutdowns related to the coronavirus pandemic,” he wrote. “Amazon’s reported data practices are an existential threat that may prevent these businesses from ever recovering.”

First, let’s note that Amazon’s production of high-volume commodity products under its house brand (Amazon Basics) is not a particular threat to the average mom-and-pop retailer. Their problem is the very existence of a large, efficient, smoothly functioning online retailer. (Fifteen to twenty years ago, for example, I occasionally experimented with selling books—but I gave up when I realized that Amazon had set people’s expectations for speedy delivery far ahead of what I could possibly manage.)

The larger story here is the perversity of the overall argument: the very fact that Amazon has proved indispensable in a crisis is the thing that makes it dangerous. It’s exactly the attitude toward, say, Hank Rearden in Atlas Shrugged: The more he does to keep his steel mills running and keep the country moving, the more it is regarded as “unfair.”

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