President Trump Goes After Amazon

President Trump has again made Amazon the target of criticism, citing the company’s failure to collect sales taxes and its strain on the United States Postal Service (USPS). A series of tweets on the issue began Thursday, March 29: “I have stated my concerns with Amazon long before the Election. Unlike others, they pay little or no taxes to state & local governments, use our Postal System as their Delivery Boy (causing tremendous loss to the U.S.), and are putting many thousands of retailers out of business!”

In late 2013, Amazon.com announced that it had struck a deal with USPS that would enable the online retailer to offer Amazon Prime customers Sunday delivery. At the time, USPS noted that under the program it would for the first time deliver packages at regular rates on a Sunday, whereas previously, consumers had to pay an extra fee for delivery on that day.

In tweets published Saturday, April 1, the President referred to the “Post Office scam,” by which “the U.S. Post Office will lose $1.50 on average for each package it delivers for Amazon.” He additionally highlighted the New York Times’ assertion that the “the size of the company’s lobbying staff has ballooned,” concluding that “Amazon must pay real costs (and taxes) now!”

In a tweet on Monday, April 2, President Trump stated that, “Only fools, or worse, are saying that our money losing Post Office makes money with Amazon. THEY LOSE A FORTUNE, and this will be changed. Also, our fully tax paying retailers are closing stores all over the country…not a level playing field!” He followed up on this claim Tuesday, April 3, tweeting, “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?)!”

The USPS has been losing money for the past 11 years, but it is not directly related to package delivery, according to the Daily Mail. The USPS has seen double-digit increases in revenue on the package delivery side, the article noted, though this has not been enough to offset the costs of pensions and health care in conjunction with declines in first-class letters and marketing mail. The Mail speculated that the President was referencing a Wall Street Journal analysis arguing that USPS’ formula for cost calculation is outdated.

The tweets were published following an Axios report on Wednesday, March 28, stating that President Trump “hates Amazon,” with unnamed sources reporting the President’s expressed desire to “go after Amazon with antitrust or competition law.” Amazon’s stock values dropped after the publication of the Axios article and fell further after the tweet on Thursday, demonstrating the influence of the President’s attacks on the company even while it is unclear what action the White House could take to limit Amazon’s abuses.

While President Trump’s ongoing personal conflict with Amazon CEO Jeff Bezos is well-documented, critics of Amazon’s practices have underscored the legitimacy of critiques of Amazon as a monopoly. On Thursday, March 29, Minnesota Representative Keith Ellison said in a statement: “The Trump administration should rein in giants like Amazon because they have an unfair stranglehold on the competition, not because the president has a personal feud with a company’s CEO.”