Wednesday 18 December 2013

Cutting Down The Amazon (.com)

The BBC recently aired a Panorama documentary where they sent an undercover worker into an Amazon distribution centre in Wales.  They discovered that all the things we've been hearing about Amazon recently are true; they treat their staff appallingly, their working conditions are likely to lead to both physical and mental stress and staff can be sacked for not meeting impossibly high targets or just so Amazon can avoid paying benefits full time workers are entitled to.

But here's something I didn't know about Amazon, in addition to not paying taxes they receive millions of pounds of handouts from the British taxpayer.  The Scottish Government gave Amazon a handout of 6.8million pounds on the promise they would create 1700 jobs.   Not to be outdone, the Welsh Government gave them 8.8million and built them their own road ('Ffordd Amazon' – 'Amazon Way') for another 4.9million for 1200 jobs in Swansea.   I'm not sure if they've considered that Amazon are almost certainly destroying more jobs in bookshops and other retail outlets overall than they're creating, I'd be very surprised if this drive to greater efficiency created jobs overall.

The Libertarian philosopher Roderick T. Long argues that in addition to the well know concept of 'economics of scale', there are also 'dis-economics of scale', problems that arise when corporations get too big.  He argues that allot of the super large corporations that we see today are not a product of the free market but rather they come about due to the way the State interferes with the market.   Amazon would seem to be an example of this.   I wouldn't mind the loss of the local bookshops if it really was more efficient just to purchase books online, but it actually might not be as Amazon's low prices must in some part come from their tax advantage and the social welfare cheques they receive.

Here's the Panorama documentary in full -  

And here's a link to a talk by Roderick Long on how market forces act to limit the size businesses can grow to and how State intervention is usually needed to overcome this -

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