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Amazon shares fall after report Trump wants to curb its power

As Trump Attacks Amazon-Postal Service Ties, He Fails To Fill Postal Governing Board

Postby smix » Tue Apr 03, 2018 5:32 pm

As Trump Attacks Amazon-Postal Service Ties, He Fails To Fill Postal Governing Board
NPR

URL: https://www.npr.org/2018/04/03/59885405 ... verning-bo
Category: Business
Published: April 3, 2018

Description: President Trump has argued in recent days that U.S. Postal Service has lost a fortune delivering Amazon packages at a discount. However, some of the agency's problems might lie with the president. The top planning and oversight board at the Postal Service has been unable to meet and consider matters such as the agency's long-term relationship with Amazon, because the president has failed to appoint any of the nine governors to the 11-member Board of Governors of the U.S. Postal Service. In October, Trump nominated three candidates, who still await Senate confirmation. The board needs at least four new members to have a quorum for meetings, which prompted concerns from a bipartisan group of senators late last year. "Without a quorum, the Postal Service cannot make key operational decisions or provide accountability for operational deficiencies, such as intentional mail delays, drug trafficking through the Postal Service's network, and dramatically falling mail volumes and revenue," according to a November letter to President Trump from the Senate Committee on Homeland Security and Governmental Affairs. The White House has not responded to NPR's request for comment. The USPS Board of Governors operates similarly to a corporate board of directors. They act as a critical body charged with the big thinking and strategic planning, which includes setting long-term goals, controlling expenses, writing policies and deciding how to invest in the Postal Service of the future. With no governors, the board is operating in a "temporary emergency" status, with its powers delegated to the postmaster general and her deputy. Just as the USPS has found itself at the heart of Americans' massive shift to online shopping and high expectations of fast delivery, the Post Office's board lost its quorum at the end of 2014 — and lost its final appointed governor in December 2016. The Senate had previously blocked several candidates nominated by President Obama. The Washington Post has reported that Sen. Bernie Sanders has blocked several nominees in the past, "because he believes they would slash jobs and outsource one of America's oldest institutions to private companies." Over the past several days, Trump has gone after Amazon's deal with the U.S. Postal Service largely over the rates the retail giant pays for delivery. Amazon relies on the Postal Service for about 40 percent of its package deliveries. United Parcel Service and FedEx also use USPS for some deliveries. Amazon is known to process its own packages and rely on the USPS only for the so-called last mile delivery, to the shoppers' doors. Trump has tweeted that the USPS "will lose $1.50 on average for each package it delivers for Amazon." The number is a reference to a Citigroup research note, which suggested the USPS could raise its average package delivery rate by that amount to fully cover all its costs, including pensions. "That's not a number specific to any individual customer, it's a broad number general to their business," said Chris Wetherbee, a senior transportation analyst who wrote the research note. Amazon relies on the Postal Service for about 40 percent of its package deliveries. United Parcel Service and FedEx also use USPS for some deliveries. Amazon is known to process its own packages and rely on the USPS only for the so-called last mile delivery, to the shoppers' doors. Trump has tweeted that the USPS "will lose $1.50 on average for each package it delivers for Amazon." The number is a reference to a Citigroup research note, which suggested the USPS could raise its average package delivery rate by that amount to fully cover all its costs, including pensions. "That's not a number specific to any individual customer, it's a broad number general to their business," said Chris Wetherbee, a senior transportation analyst who wrote the research note. Amazon and the USPS haven't disclosed the rates involved in their deal, but by law, the Postal Service's package-delivery contracts must be profitable, making enough money to cover all the associated costs. The contract with Amazon is reviewed by the Postal Regulatory Commission every year. Wetherbee says the parcel delivery is the fastest-growing part of the Postal Service's business. And while package deliveries offset a lot of the costs, he says the rates generally aren't enough to cover all of the expenses across the entire Postal Service. "They do make money, there's revenue associated with their business — what they're not taking care of is the retiree benefits," he says. "When they don't make the pension payments ... that's when you get the big splashy losses." The USPS is mandated by law to pre-fund future retirement benefits for thousands of current employees, which costs about $5.5 billion a year. For years, the Postal Service has been unable to cover its expenses. Amazon's shares have been slammed by Trump's tweets. He has criticized Amazon as not paying enough taxes and also accused The Washington Post — an independent news organization owned by Amazon CEO Jeff Bezos— of being "used as a 'lobbyist.' "Amazon and the USPS haven't disclosed the rates involved in their deal, but by law, the Postal Service's package-delivery contracts must be profitable, making enough money to cover all the associated costs. The contract with Amazon is reviewed by the Postal Regulatory Commission every year. Wetherbee says the parcel delivery is the fastest-growing part of the Postal Service's business. And while package deliveries offset a lot of the costs, he says the rates generally aren't enough to cover all of the expenses across the entire Postal Service. "They do make money, there's revenue associated with their business — what they're not taking care of is the retiree benefits," he says. "When they don't make the pension payments ... that's when you get the big splashy losses." The USPS is mandated by law to pre-fund future retirement benefits for thousands of current employees, which costs about $5.5 billion a year. For years, the Postal Service has been unable to cover its expenses. Amazon's shares have been slammed by Trump's tweets. He has criticized Amazon as not paying enough taxes and also accused The Washington Post — an independent news organization owned by Amazon CEO Jeff Bezos— of being "used as a 'lobbyist.' "



Amazon vs Trump Goes Postal
NPR

URL: https://www.npr.org/sections/money/2018 ... oes-postal
Category: Business
Published: April 19, 2018

Description: President Trump doesn't like Amazon's deal with the USPS. He recently repeated an estimate that the US mail loses $1.47 every time Amazon uses it to send a package. The Postal Service is losing money. But Josh Barro of Business Insider discovered Trump's assertion that Amazon isn't paying enough to use the USPS is based on faulty data. And a lack of understanding of how the Postal Service works.
--
Transcript
CARDIFF GARCIA, BYLINE: President Donald Trump is not the biggest fan of Amazon the company or of its founder, Jeff Bezos. And a couple of weeks ago at a press conference, the president said this about Amazon's relationship with the U.S. Postal Service.
(SOUNDBITE OF PRESS CONFERENCE)
PRESIDENT DONALD TRUMP: You take a look at the post office, and the post office is losing billions of dollars - and the taxpayers are paying for that money - because it delivers packages for Amazon at a very below cost. And that's not fair to the United States. It's not fair to our taxpayers.
STACEY VANEK SMITH, BYLINE: Amazon is a customer of the Postal Service, which delivers a lot of Amazon's packages. And what President Trump argued was that the Postal Service should be charging Amazon more money to deliver those packages. And Trump even had a specific - a very specific - amount in mind.
(SOUNDBITE OF PRESS CONFERENCE)
TRUMP: And a report just came out. They said $1.47, I believe, or about that. For every time they deliver a package, the United States government, meaning the post office, loses $1.47.
GARCIA: $1.47. That is...
VANEK SMITH: Not $1.46.
GARCIA: No.
VANEK SMITH: Not $1.48 - $1.47.
GARCIA: $1.47 - that is today's Planet Money indicator. It's how much the president says the post office is losing every time it delivers a package for Amazon. Just one problem - it's totally wrong.
VANEK SMITH: Totally wrong. Terrible.
GARCIA: Shocking.
VANEK SMITH: Just a wrong indicator.
GARCIA: So where did the number come from? And what is the truth about Amazon's deal with the Postal Service? I'm Cardiff Garcia.
VANEK SMITH: And I'm Stacey Vanek Smith. This is THE INDICATOR, where every day we tell you a short story about the economy.
(SOUNDBITE OF DROP ELECTRIC SONG, "WAKING UP TO THE FIRE")
JOSH BARRO: I'm Josh Barro. I'm a senior editor at Business Insider. I'm also the host of KCRW's Left, Right & Center podcast.
GARCIA: Josh is the journalist who identified the exact problem with President Trump's assertion that the post office loses $1.47 each time it delivers a package for Amazon. And then Josh brought the problem to our attention. So to get one simple thing out of the way, where did President Trump get that number?
BARRO: It's clear that what he's referencing is an equity research note that came from Citigroup last April called the free shipping tax. And their note was echoing an argument that's been coming from UPS, which obviously is a major competitor to the Postal Service in package delivery, which has been saying that package prices from the Postal Service are too low, and that they should have to use a new formula to set those prices. And Citi in its estimate said that if those recommendations were followed, that would cause package prices at the post office to go up by an average of about $1.50.
GARCIA: But the $1.47 figure does not actually refer to how much the Postal Service is undercharging Amazon. The note refers to the average amount that the Postal Service charges all of the customers that use the Postal Service for delivering packages. Amazon is only one of those customers.
VANEK SMITH: We don't actually know what the Postal Service charges Amazon. Only the Postal Service and Amazon know for sure. It is not public information.
GARCIA: So President Trump misread the note. But the much bigger problem, Josh says, is that the Citigroup note includes a huge factual mistake. And to understand that mistake, though, first we need to understand how the U.S. Postal Service actually works. And by the way, this is surprisingly fascinating, at least to us.
VANEK SMITH: It's - it actually, no, I think it's objectively fascinating.
GARCIA: To everybody.
VANEK SMITH: To everybody.
GARCIA: Yes (laughter).
VANEK SMITH: All people will think this is fascinating.
GARCIA: So stick around.
VANEK SMITH: Hold onto your hat.
GARCIA: (Laughter).
VANEK SMITH: So you can think of the Postal Service as having two different businesses. The first business is what most of us probably think of when we think of the Postal Service.
GARCIA: Yeah. And this business is called the market-dominant business. And that is just a horrible name...
VANEK SMITH: Terrible. Terrible.
GARCIA: ...So forget it. We are just going to here call it the normal mail business. So it's...
VANEK SMITH: Much better name.
GARCIA: Yeah. And it's what you might use to send letters, first-class mail, holiday cards or wedding invitations, or to get junk mail from companies - everybody's favorite.
VANEK SMITH: Yes.
GARCIA: And generally this is just the kind of mail that requires stamps. Josh says this business comes with quite a few strings attached.
BARRO: These are things where the post office has a legal monopoly - nobody else is allowed to open a competing business that delivers first-class mail - and where the post office also has various legal obligations about who it has to deliver to. It has to deliver in most cases six days a week. It has to do that whether or not it's profitable. It also has to charge the same price for first-class mail no matter how far you're sending a letter in the country.
VANEK SMITH: The Postal Service still earns the majority of its revenues delivering this kind of mail. But the business has been in decline for years because of competition from things like email and social media.
GARCIA: The Postal Service's second business is called competitive products. And this is the business that deals with Amazon. We also don't need to change the name because it's easy to remember because competitive products, that business, is the part of the Postal Service that competes with other carriers of bigger packages like UPS and FedEx. This part of the Postal Service - the competitive products business - is supposed to act like a private company. It's supposed to try to at least - at least break even and hopefully make money. And it can negotiate with its biggest customers.
VANEK SMITH: And the relationship with Amazon is one of the reasons that the competitive products business has been growing in recent years, with revenues climbing almost 12 percent last year.
GARCIA: And now we get to the controversy. The Postal Service overall loses money each year. And like any organization, it has sources of revenue, and it also costs money to run. And to understand whether the competitive products business loses money, we have to know how the Postal Service allocates its costs between the packages business and the normal mail business.
VANEK SMITH: And this is complicated because so many parts of the Postal Service are used for both of the businesses - the drivers, the buildings, the trucks.
GARCIA: If you've got a truck that's already coming to your house to deliver like junk mail and letters from your family and things like that, it doesn't seem like it would cost too much more to throw in something you also ordered from Amazon, right? Maybe you need a little bit more space in a truck, so you need a bigger truck. But for the most part, it seems like it's just along for the ride.
BARRO: Or maybe you don't need a bigger truck because first-class mail volumes have fallen immensely over the last 15 years. So this is a thing with the post office. It has more real estate than it needs - in a lot of cases, more employees than it needs. And so if it were a private company, you'd say, well, you'd sell off the real estate, lay off employees, shrink the business if you weren't going to have them start delivering packages. But politically, that's not necessarily an option for the post office. It still has to send that truck to your house six days a week. And if the truck's only half full, it can't decide I'm only going to deliver three days a week with twice as much stuff in the truck. If it tries to close post offices, you get a lot of outcry in Congress over that sort of thing.
GARCIA: What Josh is saying here is that the added costs of delivering packages are not that high given that so many of those packages will be delivered to places that the Postal Service was already legally obligated to visit for its normal mail business.
VANEK SMITH: The packages business charges its customers, like Amazon, more than enough to cover those added costs.
GARCIA: But the packages business also has to charge its customers enough to cover some of the costs that it shares with the normal mail business - things like those driver's salaries or use of the trucks or the buildings that they run out of. In fact, the packages business has to follow a rule that it will cover a minimum amount of these bigger institutional costs.
VANEK SMITH: And here's where we get back to the Citigroup note. Remember that the note argued that the packages business should charge its customers a $1.47 more per package. Here is how it arrived at that number. The note first estimated how much of these bigger institutional costs the packages business should have to cover based on how big the packages business was.
GARCIA: And then the note assumed that the packages business was only charging the minimum required amount.
VANEK SMITH: And this was just wrong.
GARCIA: So wrong.
VANEK SMITH: So wrong - when the actual numbers came out, it turned out that the Postal Service was charging way more than the minimum. In fact, it was charging almost enough to cover the share of the institutional cost that Citigroup thought it should cover.
GARCIA: So the note just had this massive factual error in how it calculated the number that Donald Trump then publicly used. And by the way, one of the authors of the note did admit the error to Josh.
VANEK SMITH: And there's a reason that this error is important. Josh says that the Postal Service's overall losses would have been bigger if not for the growth of the competitive products business.
BARRO: I mean, the reason that it was generating more revenue that could go toward the institutional cost of the post office was that package volumes had been growing at about 15 percent a year. So not only were they maintaining the margin that they were making on each thing that they were delivering, they were just delivering more packages. And so they were able to generate more revenue toward their overall institutional costs by acting like a business and growing.
GARCIA: In other words, the Postal Service's overall losses almost certainly would have been bigger if not for the success of the competitive products business - the business that deals with Amazon. And that number that President Trump has been throwing around is based on a mistake.
(SOUNDBITE OF DROP ELECTRIC SONG, "WAKING UP TO THE FIRE")
GARCIA: If you want to know more, we are linking to Josh's piece at npr.org/money, along with a couple of other reports on the Postal Service's financial situation. We did reach out to Citigroup, and they sent us their recent updates to the research note. And we will link to those updates as well if they are made publicly available.
(SOUNDBITE OF DROP ELECTRIC SONG, "WAKING UP TO THE FIRE")
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If Trump runs against Amazon, he will lose

Postby smix » Tue Apr 03, 2018 7:28 pm

If Trump runs against Amazon, he will lose
Business Insider

URL: http://www.businessinsider.com/trump-am ... ons-2018-4
Category: Business
Published: April 3, 2018

Description: In November 2016, Donald Trump got 63 million votes for president. So let's do a little comparative measuring. Amazon doesn't release statistics on Prime membership, but the investment-research firm Consumer Intelligence Research Partners uses a consumer survey to estimate that 90 million American adults have access to an Amazon Prime membership. The investment bank Cowen uses another survey to estimate that there are 60 million Amazon Prime member households in the US. That's up from 50 million households a year earlier. And of course, 60 million households entails a lot more than 60 million adults. So, the "Amazon Prime user" demographic is already substantially larger than the "Trump voter" demographic — and while Trump's support base appears stagnant at best, Cowen believes Amazon continues to add new Prime members at a double-digit annual percentage rate. So, Trump will likely be seeking reelection in 2020 at a time when nearly half the 240 million adults in the US are users of Amazon Prime. Does he really want to have a fight over whether Amazon should have to pay higher prices for shipping — which, in turn, would likely mean a higher Prime membership fee, or maybe even an end to free two-day shipping?
The NFL is weak; Amazon is strong
I understand why Trump feels emboldened to take on Amazon. He has sometimes found ways to pick fights with private businesses and win. His fights with the National Football League over cultural issues have arguably been politically beneficial to him, and they have been clearly detrimental to the NFL. But Amazon is not the NFL. The NFL was weak prey, highly vulnerable to Trump's attack. NFL stakeholders are divided: Team owners have to appeal simultaneously to a fan base, much of which supports Trump, and a majority-black player community, which stands against him on a major cultural issue. The league faces an enormous brain-damage scandal that is scaring families away from youth football and eroding the current and future fan base. And a lot of people think the games have gotten boring. And the NFL faces strong competitors: If people get turned off from professional football, there are a lot of other things they can watch. One of the competitor products, college football, is extremely similar and arguably more fun. For all those reasons, Trump has been able to put the NFL in a no-win situation, at a time when the league's image was already suffering and fans' attachments to the league had already been weakening. Amazon is not like this at all. Amazon offers products and services that people like a great deal, and, according to the Harris Poll, it has the most positive public image of any of the 100 major companies whose reputation they track.
You will have to take free shipping from the electorate's cold, dead hands
Amazon's stakeholders are aligned regarding the key issue Trump on which has attacked them: Neither sellers nor buyers on the platform have any desire for higher postal rates. The US Postal Service, for its part, also insists its Amazon-related operations are financially beneficial. If Trump were to take action that caused Amazon's shipping costs to go up, the relevant stakeholders — including nearly 100 million American customers — would be broadly united on Amazon's side of their business dispute with Trump. It would be a political nightmare for the president. Whatever Democrat runs against him in 2020 would be able to run as the candidate who would bring back free shipping. No issue unites Red America and Blue America like free shipping. Amazon does have some political exposure on the state and local tax issue that Trump has highlighted. Many state and local officials in both parties would like to close some of the loopholes and collect more sales taxes. So on that issue, Trump has key allies. But Amazon has already begun collecting sales tax on its own sales in every state that levies a sales tax. If Amazon is required to start collecting sales tax on sales by marketplace sellers (something that is likely to happen in due time, Trump feud or no) the company will adjust, just as it has adjusted to collecting the tax on its own sales.
Trump is unlikely to motivate his supporters to stop shopping Amazon
Of course, there are matters other than direct public-policy risk. Amazon might worry that a president with tens of millions of supporters is publicly criticizing them. What if his supporters are motivated to take their business elsewhere? But there are also reasons Amazon is well positioned not to worry too much about this. First, unlike the NFL, Amazon does not have competitors that can easily swoop in and take its place. For most customers, abandoning Amazon wouldn't be an easy form of virtue signaling. They'd be forced to do something more expensive and less convenient; it would be way harder than changing the channel. Sure, there are other retailers, but Amazon reached its dominant position by offering the broadest selection and, crucially, free two-day Prime shipping, which is made possible in part by its unmatched logistics operation. And maybe most important, Trump supporters don't automatically follow his instructions about what businesses to hate. They do it when Trump's grievances align with their own. It is useful here to look, again, at the NFL example. Do you remember, vaguely, that during Trump's efforts to gin up anti-NFL sentiment, he took a detour to attack Golden State Warriors point guard Stephen Curry? Do you remember why this never really became A Thing in the way the NFL-national anthem controversy did? Partly, it's that the NBA fan base is more African-American and more left-leaning than the NFL fan base. But it's also because "was Steph Curry nice to the president" is not a hot-button cultural issue. Lots of Americans have strong feelings about race relations and policing and the national anthem and all sorts of issues that were bound up in the NFL controversy. An NBA controversy? Not so much. Now let's think back to Amazon. What is the hot-button cultural issue that Trump is supposed to be exploiting to Amazon's detriment? Is it postal rates? Sales-tax-collection practices? Financial difficulties facing mall owners? The fact that Jeff Bezos owns The Washington Post? None of this is the national anthem. These topics are boring to most people.
Even Uber has won most of its public-policy fights
In city after city, Uber has faced entrenched business interests that didn't want its business to grow. Incumbent transportation firms and taxi-medallion owners wanted to stave off competition. They donated generously to local officials, and, initially, they seemed to have a lot of political support. And in most places, the taxi owners ultimately lost, and Uber won, winning access to markets on more or less its own terms. Why did Uber win? Because people liked its convenient service. Ultimately, the public's desire to not have to deal with taxis has overpowered special-interest lobbying by incumbents. Uber has achieved those victories despite a terrible public image. Now consider Amazon, which has an excellent public image, a much larger American user base than Uber, and a business model that is not doomed to unprofitability. Trump is about to learn something Bill de Blasio learned the hard way: When you fight convenience, you lose.
Amazon will be here longer than Trump
Amazon is famous for taking the long view in its business operations — often to the great consternation of its competitors, who complain Amazon drives unsustainably low prices because it does not care about posting profits. The company has achieved great latitude from its shareholders, who have been willing to accept "growth now, profits later" for two decades. And the company shows no sign of stopping that approach. As such, the company is better positioned than most to withstand a temporary political controversy. Amazon can go on doing what it's doing, gathering an even more dominant market position, and realizing this Trump nonsense will be over in a few years. This too shall pass.



Trump blames Amazon for killing the USPS — and it reveals a bleak future for the postal service as we know it
Business Insider

URL: http://www.businessinsider.com/trump-am ... daq-2018-4
Category: Business
Published: April 3, 2018

Description: This week, President Trump reiterated his disdain for Amazon, arguing that the tech giant has led to the downfall of the United States Postal Service. Amazon is "costing the United States Post Office massive amounts of money for being their Delivery Boy," he tweeted on Tuesday, continuing, "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?)!" It's unclear whether Amazon is directly to blame for USPS' struggling finances. As Business Insider's Kate Taylor notes, the USPS' business model is likely unsustainable in its current form, largely because it relies on stamp sales for much of its revenue. The postal service, however, was doomed financially from the start. And that has a lot to do with the democratic purpose it sought to serve in cities across the US. In 1792, the Post Office Department (USPOD) was established with a far-reaching civic goal to spread information freely across all states. That year, the national Postal Act mandated lower prices for newspapers, forbade postal workers to open private mail, and encouraged Congress to create postal routes. The Postal Policy Act of 1958 further cemented the USPS' mission to promote the "social, cultural, intellectual, and commercial intercourse" in every American town and city (and that the general treasury should assist the USPS as necessary). The service flourished throughout the 19th and most of the 20th century (before the internet). While there was no one catalyst for the USPS' plummet, the nation's shift from physical mail to email was a big contributor. The service's letter-delivery revenue had long subsidized its package deliveries, but following the internet boom people started sending fewer letters. The USPS has taken a huge hit. Many economic and political analysts said we should prepare the USPS' grave long before Trump began slamming Amazon. The service's revenue has declined by $5.1 billion in the past decade. And in February, the USPS posted a net loss of $540 million in the first quarter of 2018. Even if the Trump administration set new regulations on Amazon, the USPS will probably still struggle, because the quasi-government run agency was never meant to operate as a profits-focused retailer. Unlike its competitors UPS and FedEx, the USPS has built so many locations that it's able to offer "last-mile" delivery, an expensive service that traditional retailers would lose money on if they did it themselves. The USPS now has a monopoly on letter delivery and more domestic locations than McDonald's, Starbucks, and Walmart combined. Similar to public plazas and mass transit, the USPS' first priority is to serve civilians. It's also notoriously hard for cities and states to not lose money from maintaining subways and publicly owned parks, which is why those services are heavily subsidized by tax dollars and user fares. The USPS does not receive federal money, but Congress still controls the service's budget and operations. In a 2015 paper from the Brookings Institution, senior researcher Elaine Karmarck writes that the USPS "exists in never-never land," since it's neither a fully public nor private organization. "It is supposed to compete and innovate but it is stifled by law and saddled with a governance structure that impedes innovation," she writes, arguing that the USPS should break up into two separate entities. One would be private — "defined in a way that meets the reality of the information age" — and the other would be public. While USPOD could've never anticipated email, Amazon Prime, and Cyber Monday, it's unclear if the modern-day USPS will be able to preserve its original, civic mission in the 21st century.



Ex-postmaster general defies Trump by 'unequivocally' stating that Amazon's contract is profitable for the US Postal Service
Business Insider

URL: http://www.businessinsider.com/trump-is ... ral-2018-4
Category: Business
Published: April 5, 2018

Description: The former head of the US Postal Service is taking on President Donald Trump's campaign against the USPS' Amazon deal. "Only fools, or worse, are saying that our money losing Post Office makes money with Amazon," Trump tweeted Monday. "THEY LOSE A FORTUNE, and this will be changed." Trump doubled down with another tweet on Tuesday, saying Amazon is "costing the United States Post Office massive amounts of money for being their Delivery Boy." However, according to Patrick Donahoe, who served as the postmaster general from 2010 to 2015, that's simply not true. Donahoe "unequivocally stated that the Amazon contract is profitable for the USPS" while in conversation with UBS analysts, according to a note released by the bank on Thursday. The former postmaster general broke down the fact that the USPS' business is split between mail — like letters and magazines — that only the government service could deliver, and "competitive products," or packages that rivals like FedEx or UPS could deliver. Package delivery legally needs to cover operating costs and 5.5% of USPS' fixed costs. According to Donahoe, package products are covering "meaningfully more" than the 5.5% allocation. Last year, shipping-and-package revenue jumped by $2.1 billion, an increase of 11.8% over the previous year. According to the USPS, much of that growth was thanks to e-commerce. Last year, the USPS reported a net loss of $2.7 billion on $69.6 billion in revenue. Critics, such as President Trump, argue that Amazon should increase the prices of package delivery to cover these loses. A report by Citi last year found that if the USPS were to cover its costs by increasing package-shipping prices, each package would cost an average of $1.46 more to ship. Amazon would be one of the companies hit hardest if the USPS were to increase prices — Citi analyst Christian Wetherbee estimated that a price hike would cost Amazon $2.6 billion. However, if the USPS were to increase prices, it could lose out on business to competitors such as UPS and FedEx — something that Donahoe acknowledged when speaking with UBS. The business-to-consumer "package market is dynamic and the USPS is likely very cognizant of potential risk to package volumes if they significantly raise rates," Donahoe said, according to analyst Eric J. Sheridan. The USPS' low fixed costs and mandate to deliver mail to Americans makes it an ideal option for Amazon's "last-mile" delivery, or a package's journey from a fulfillment depot to its final destination. While FedEx or UPS avoid last-mile deliveries in many cases as they tend to be unprofitable, the USPS can complete deliveries at a lower cost. Amazon's contract with the USPS reportedly expires this October. However, despite Trump's battle against the company, Donahoe indicated it was unlikely that the USPS would substantially raise prices in an updated contract. "USPS is cognizant of the importance of private shippers like Amazon and the role they have played in improving the organization's financial performance," according to the UBS note.



One of the central arguments in Trump's attacks on Amazon is all wrong — and it's Citigroup's fault
Business Insider

URL: http://www.businessinsider.com/trump-am ... ote-2018-4
Category: Business
Published: April 7, 2018

Description: On Monday, President Donald Trump tweeted that the post office loses $1.50 for every package it delivers for Amazon. On Tuesday, he said it was $1.47. Where did he get these figures? He didn't make them up. He's relying on an equity research report from Citigroup, which doesn't quite say what the president says, but it says something pretty close. The Citi note, from last April, proposes that the post office may need to raise the average price per piece for its "competitive products" by $1.46 — that is, not just deliveries for Amazon, and not just parcels, but also priority and express mail. But Trump's garbling of the precise figure isn't the important thing. The important thing is that the Citi note itself is wrong. The bank made a key math error in coming up with the figure the president has seized on. Essentially, Citi assumed competitive products were less lucrative for the post office than they really are, and so the firm greatly overestimated how much prices would have to rise to meet a specific revenue benchmark. The right numbers would have called for an 11-cent increase in price-per-piece for competitive products, which is a lot less than $1.46. Plus, Citi's underlying analysis of how the post office ought to price package delivery makes little sense, even if you correct the math. It leads to a useful talking point for a president with a vendetta against Amazon, but it's not good business analysis.
In what industry would you let your competitors tell you how to price your products?
The Citi note was released shortly after a Postal Regulatory Commission rulemaking process on postal prices began, and it closely echoes arguments UPS made in those proceedings. UPS called for allocating more of the post office's institutional costs away from first-class mail and toward competitive services like package delivery, which would have had the effect of forcing the post office to raise prices on packages. Obviously, UPS has an interest in getting the post office to raise prices, so it can raise its own prices. Citi's note estimates UPS' earnings per share would rise nearly 50% if the post office followed Citi's guidance on parcel pricing. But contrary to Citi's argument that current package pricing is "uneconomic," the commission rejected the pricing approach advocated by UPS this February, saying the UPS proposal is "inherently arbitrary" and "fails to maximize economic efficiency because it is not based on marginal cost and does not yield prices reflecting market demand." The flaw here — for both UPS and Citi's related analysis — comes from the fact that the post office is in a lot of businesses at once. Yes, it competes with FedEx and UPS on packages and express letters. It also has a legislative mandate to deliver first-class mail all over the US, six days a week, and for a fixed price, which is often a money-losing endeavor. And it has enormous legacy costs from a time when it used to employ a lot more people and its real-estate needs were quite different than they are today. The UPS proposal, as endorsed in the Citi note, would have obligated the post office to cover more and more of those legacy costs by raising prices on packages and other products where it competes with UPS. Such a move would have been good for UPS, but it would have been bad for consumers, bad for shippers, and quite possibly bad for the post office and taxpayers, if the higher prices caused package volumes to decline. Instead of going this direction, the PRC has proposed a rule that gives the post office flexibility and does not require any increase in prices for competitive products — the post office could even cut prices and remain in compliance. UPS, for its part, still objects to the direction PRC has taken. "UPS believes that the Postal Service's explosive package delivery growth is driving additional costs that are not being accounted for in the Postal Regulatory Commission's existing and proposed formulas," said Kara Ross, a spokeswoman for UPS, in an email to Business Insider.
How Citi got the math wrong
You can break most of the lines of business at the US Postal Service into two categories. There are "market-dominant products," like first-class mail, where the post office has a legal monopoly and a legal obligation to provide universal service. And there are the competitive products, like parcel delivery and priority mail, where the post office competes with private companies. The Postal Accountability and Enhancement Act of 2006 requires that competitive products be, well, competitive. The post office is required to price them so they bring in at least enough revenue to cover the costs directly associated with providing them, plus an "appropriate share" of costs that can't be readily allocated, such as certain real-estate expenses or the salary of the postmaster general. For the past 10 years, this minimum "appropriate share" was set at 5.5%. But package delivery has been growing as a share of USPS business, and UPS has been urging the PRC to raise this share. The Citi note proposed increasing the appropriate share to 24.6%, relying on prior proposals from UPS. By Citi's estimate, this change would have required the post office to cover an additional $7 billion of operating expenses through higher prices on competitive products, which would have required charging an extra $1.46 per piece delivered. The big problem in Citi's analysis is associated with the phrase I italicized a few paragraphs above: "at least." The 5.5% regulation is a floor. And lately, the post office has been far above the floor. You can see it here in this table — Citi assumed revenue from competitive products was only covering the regulatory minimum of 5.5% of nonallocated costs ($2 billion) as of 2017. But PRC figures show they actually covered 23.2% of those costs ($8.5 billion). As such, raising the floor by imposing what Citi calls a "corrected" cost methodology would have required the post office to come up with only an additional $500 million a year in profits from competitive products, not $7 billion. USPS could have met that goal by raising competitive product prices by 11 cents per piece, not $1.46. In fairness to Citi, 2017 financial data from the postal service wasn't available when the firm made projections for 2017 in this research note, because 2017 wasn't over. But figures from 2015 and 2016 were available, showing the postal service had achieved ratios of 13.3% and 16.5% in those two years. Using an average of those figures would have cut Citi's proposed price increase roughly in half. I asked Citi's lead analyst on the note, Christian Wetherbee, whether it was simply a mistake that figures on the post office's actual performance weren't used to calculate how much it would have to raise prices to meet the proposed revenue benchmarks. "I'd love to say it wasn't a mistake," he said. "It's something that should have been in there."
Citi and UPS want to use package pricing to fix unrelated financial problems at the postal service
Even after fixing the math error, the Citi note doesn't make a good substantive argument that the post office's pricing model for competitive products is "unsustainable," or that prices need to go up. In recent years, the post office has been losing several billion dollars a year, if you account for legally mandated payments to shore up a fund for retiree health benefits (which the service has shirked making). Citi sought to address those financial troubles through the other pricing scenario it considered in its note: Raise competitive products prices by $1.74 per piece and the postal service's annual multibillion-dollar losses get wiped out, making it possible to make the retiree benefits fund payment. "Inherently in our analysis there was an assumption that you should be able to generate enough revenue from the competitive products for the whole enterprise to break even," Wetherbee told me. There are a few big problems with that idea. First, it assumes raising prices by more than 50% would not lead to any reduction in package and express-mail volume, which doesn't seem reasonable. Second, it treats the legally mandated retiree healthcare payment as a current-period business expense, when in truth only part of it is. The retirement benefits situation at the post office is very complicated, but essentially the service spent decades failing to prefund benefits it was promising workers, and then Congress passed the PAEA, which mandated the service close the funding gap within 10 years. This seemed reasonable in 2006, when the economy was strong and first-class mail volumes were not yet cratering. Payments to close the retiree benefit funding gap have to come from somewhere, but they're not properly counted as business expenses for the current period. It's illogical to say a payment to cover a retirement benefit that a worker earned in 2004 is part of the cost to deliver a package for Amazon today, because the retiree will be owed the benefit regardless of whether any more packages are delivered. But the biggest problem with Citi's break-even analysis has to do with first-class mail and standard mail, which is the technical term for junk mail. Why would the assumption inherent in Citi's analysis be that the post office should rise prices on competitive products to a level so that its entire operation runs at a breakeven? Why not raise the price of stamps, or increase the rates that are charged to junk-mail senders?
Calls for higher USPS prices are special pleading from private shippers
In July 2017, The Wall Street Journal ran an op-ed article based on Citi's note, called "Why the post office gives Amazon special delivery." "An April analysis from Citigroup estimates that if costs were fairly allocated, on average parcels would cost $1.46 more to deliver," Joshua Sandbulte wrote. "It is as if every Amazon box comes with a dollar or two stapled to the packing slip — a gift card from Uncle Sam." Who is Sandbulte? Per The Journal, he is "co-president of Greenhaven Associates, a money-management firm that owns FedEx common stock." The truth about the postal service is that it has enormous fixed costs, some associated with those retiree benefit obligations, and some associated with real estate and other facilities it acquired decades ago when its business model looked very different, and which it faces political and practical barriers to shedding today. As the volume of first-class mail has declined, growing its package-delivery business has given the USPS a way to reuse some of its fixed assets, service some of those fixed costs, and limit the losses it would otherwise impose on taxpayers. That's why the post office has fought efforts to restrict the way it prices; if it couldn't grow this business, it would lose more money. As the PRC correctly noted, the correct question to ask when seeking to determine whether competitive-product pricing is competitive and fair is whether the post office makes money at the margin when it sells those products, and the agency concludes it does. It's hard to see how forcing USPS parcel-price increases could benefit consumers by fostering competition — after all, there is an existing, robust competitive market in package delivery, as demonstrated by the fact that UPS and FedEx already exist and make profits. A free hand on package pricing at the post office has been good for consumers, good for the post office, and good for online sellers like Amazon. It's not great for shippers that compete with the post office, and it's not great for presidents who hate Jeff Bezos because he owns The Washington Post. But they'll live.



Amazon has responded to Trump's threats over the US Postal Service and formed a lobbying group
Business Insider

URL: https://www.businessinsider.com/r-amazo ... ues-2018-8
Category: Business
Published: August 1, 2018

Description: Amazon.com Inc and other retail and logistics companies said on Wednesday they had started a new group to lobby to keep the U.S. Postal Service's package delivery services "reliable and affordable." The announcement follows a string of attacks on Amazon by President Donald Trump, complaining that the world's largest e-commerce company does not pay the U.S. Postal Service a fair rate for package delivery. Trump has said, without citing evidence, that this costs U.S. taxpayers billions of dollars, and he has threatened to raise its postal rates. The Package Coalition made no reference to Trump in a statement announcing its formation, but said it wanted to work with policymakers and the public to highlight the importance of the postal service to homes and businesses. "Reliable and affordable postal package delivery is a key engine of the American economy," said John McHugh, the coalition chairman. McHugh, a former member of Congress, served as chairman of the government's Postal Service subcommittee. Members of the new group include Columbia Sportswear , pharmacy benefits manager Express Scripts , the National Retail Federation, package shipping firm OSM Worldwide, postal service company Pitney Bowes , Publishers Clearing House and the retailer QVC. Members of the group pay the Postal Service to deliver goods the last mile to more than 150 million U.S. homes and businesses, the coalition said. "Without (the Postal Service), consumers would have fewer shipping options, reduced service in rural areas, and prices would drastically increase," said Blair Anderson, director of transportation policy at Amazon. The company did not answer a request for further comment beyond the Postal Coalition statement.
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President Trump Attacked Amazon Again. But He Got This Basic Fact Wrong

Postby smix » Tue Apr 03, 2018 9:33 pm

President Trump Attacked Amazon Again. But He Got This Basic Fact Wrong
Time

URL: http://time.com/5226036/donald-trump-am ... l-service/
Category: Politics
Published: April 3, 2018

Description: President Donald Trump blasted Amazon again, but his latest tweet inaccurately described the U.S. Postal Service as taxpayer-funded.

trump-fake-time-cover.jpg

In a tweet sent Tuesday morning, Trump argued that the Post Office was giving the online retail giant a sweetheart deal — a claim he has made before that is also wrong — before adding that these supposed costs are “bourne [sic] by the American Taxpayer.” “Amazon should pay these costs (plus) and not have them bourne by the American Taxpayer,” he wrote.
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

But the U.S. Postal Service is not run like a typical government agency. In fact, it “receives NO tax dollars for operating expenses” as it notes on its own website, instead relying on the sale of “postage, products and services to fund its operations.” The Postal Service is making money off package delivery for shippers like Amazon, while much of the money it is losing is due to a 2006 law which requires that it pre-fund future retirees’ health benefits, among other things. Trump has repeatedly attacked Amazon and its owner, Jeff Bezos, who also owns the Washington Post, often conflating the two. (The Post’s editor says Bezos plays no role in its news coverage, and the two companies are separate.) Some conservatives have argued that the Postal Service benefits from tax dollars in other ways. For example, it does not pay local property tax, unlike a private shipper like UPS, and it can borrow money from the U.S. Treasury at lower-than-typical rates. But any losses from doing business with Amazon would not be taxpayer-covered, and the Postal Service is not currently losing money on package delivery anyway.
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Prime demagoguery: Donald Trump vs. Jeff Bezos and Amazon

Postby smix » Tue Apr 03, 2018 11:50 pm

Prime demagoguery: Donald Trump vs. Jeff Bezos and Amazon
New York Daily News

URL: http://www.nydailynews.com/opinion/prim ... -1.3906279
Category: Politics
Published: April 2, 2018

Description: No one who looks at the corporate leviathan that is Amazon with clear eyes can cheer its every move. Like any dominant business, it is, almost by definition, a force for both good and ill. A great American success story, it swiftly delivers just about anything under the sun to consumers at low prices. Its backbone of cloud servers power a large swath of the internet. Alexa, in how many other ways is its technological wizardry transforming the economy? Plenty. Meantime, it’s no friend of unions in its distribution centers. Brick-and-mortar stores are getting crushed under the pressure of its prices, which sometimes have the unfair advantage of being effectively tax-free. All fair game in assessing a company with more than half a million employees and a market capitalization around $700 billion. But leave it to the Great Oversimplifier in the White House — the head of the federal government — to engender sympathy for the behemoth. Trump, who as a candidate carped bitterly about Amazon and its CEO Jeff Bezos, last week unleashed the full force of his presidential fury at the company. On Twitter (of course), he blasted the company for paying “little or no taxes to state & local governments,” for using “our Postal System as their Delivery Boy” and for “putting many thousands of retailers out of business!” Point one is mostly wrong; Amazon pays its fair share on most direct sales. It is true, though, that so-called Marketplace sales, in which third-party retailers use Amazon’s platform, don’t pay. (Many of those third-party retailers, mind you, are the very brick-and-mortar stores that Trump says are suffering because of Amazon.) Point two is also wrong. Though the Postal Service is bleeding money — and though it does give Amazon discounted service, because of its volume — the e-commerce giant’s packages are one of the U.S.P.S.’s few money-generators. Point three is true, though it’s mainly the result of millions upon millions of individual decisions by informed, price-conscious consumers. In other words, capitalism at work. One would think that Trump, who offered himself to the American people as the consummate CEO, would have a healthy respect for a company that’s mainly succeeding by outcompeting. But Trump is less a mature businessman than he is an emotionally wounded adolescent, who will never cease to suffer daily conniptions from the Bezos-owned Washington Post. It is a President’s right to be personally peeved about any company and its CEO. The second he begins marshaling the awesome power of the federal government to damage that business — that one tweet alone arguably cost Amazon shareholders billions — he will step over a bright red line. For, in Donald Trump’s case, the twentieth or thirtieth time in his presidency.
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Fox's Shep Smith fact-checks Trump's Amazon claims: 'None of that was true'

Postby smix » Wed Apr 04, 2018 7:34 am

Fox's Shep Smith fact-checks Trump's Amazon claims: 'None of that was true'
The Hill

URL: http://thehill.com/homenews/media/38154 ... t-was-true
Category: Politics
Published: April 3, 2018

Description: Fox News host Shephard Smith on Tuesday fact-checked President Trump's claim that the U.S. Postal Service was losing large amounts of money because Amazon was delivering packages at low cost. "The Post Office is losing billions of dollars, and the taxpayers are paying for that money because it delivers packages for Amazon at a very below cost," Trump told reporters at the White House on Tuesday. "That's not fair to the United States, and it's not fair to out taxpayers, and Amazon has the money to pay the fair rate at the Post Office," he continued. Trump went on to say the Post Office "loses $1.47 on every package" it delivers on behalf of Amazon.



Smith responded to each of Trump's claims on Tuesday. "The Postal Service's own numbers show it makes money by delivering packages for Amazon and other companies. As for taxpayers, the post office's own website points out, and I quote, 'the Postal Service receives no tax dollars for operating expenses.' None," Smith said. "And a reference to that $1.47 the president came up with there? A Citigroup study last year showed on average that the Postal Service was charging a $1.46 below market rates for package delivery, but our researchers point out if that discount exists, it's not just for Amazon, it's a bulk rate discount," he continued. "There is a great deal of confusion or something here regarding Amazon and the Post Office because none of that, none of that was true," Smith told Fox News White House correspondent John Roberts. Trump has taken aim at the retail giant on Twitter this week, resulting in the company's stock dropping this week.
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




Amazon hits $1 trillion valuation amid Trump attacks
The Hill

URL: http://thehill.com/policy/finance/40496 ... from-trump
Category: Business
Published: September 4, 2018

Description: Amazon briefly exceeded $1 trillion in value Tuesday amid growing criticism from President Trump, becoming the second U.S. corporation to reach that threshold. The online retail giant eclipsed the $1 trillion mark Tuesday morning when the price of one of its 487,741,189 shares rose to $2,050.27, according to CNBC. The stock value later slipped but has gained 1.17 percent as of 12:30 p.m. Apple was the first U.S. corporation to exceed $1 trillion in value when it crossed the threshold on Aug. 2. The combined value of both companies is equal to roughly 10 percent of U.S. gross domestic product. Amazon has dominated U.S. retail as more consumers shift away from brick-and-mortar stores toward online retailers. The company accounts for 49 cents of every e-commerce dollar spent in the U.S., contributing to its $178 billion in annual revenue, and it employs more than 550,000 workers, according to The New York Times. Amazon has expanded into web hosting services, advertising, consumer technology, entertainment and e-books since launching as an online bookstore in July 1995. While Amazon’s plans to build another headquarters have attracted offers of lucrative tax breaks and benefits from dozens of state and city leaders, the company has been fiercely attacked by Trump over its size and influence. The president told Fox News last week that Amazon and fellow tech giants Google and Facebook could be in a “very antitrust situation,” but declined to say whether they should be dismantled. Trump has been critical of several Silicon Valley titans over what he considers rampant anti-conservative bias, but has been particularly hostile toward Amazon. The president frequently attacks Amazon founder and CEO Jeff Bezos, who also owns The Washington Post, and links the online retailer to the newspaper’s White House coverage. The Post has said that Bezos plays no role in its editorial decisions. "The Amazon Washington Post has gone crazy against me ever since they lost the Internet Tax Case in the U.S. Supreme Court two months ago," Trump tweeted in July, seeming to refer to South Dakota v. Wayfair, Inc., which determined that states may tax purchases made from out-of-state sellers. "Next up is the U.S. Post Office which they use, at a fraction of real cost, as their 'delivery boy' for a BIG percentage of their packages." Trump has frequently criticized Amazon’s agreement with the U.S. Postal Service (USPS) to ship packages at reduced rates, blaming it for the fiscal woes at USPS. An upcoming Treasury Department report on revamping the debt-riddled USPS is expected to add further tension to that fight. Business groups have urged the Treasury Department to preserve Amazon’s agreement with the USPS, which they say helps the Postal Service’s finances and prevents the tech giant from striking a deal with private competitors. Liberal politicians and activists, including Sen. Bernie Sanders (I-Vt.), have also raised concerns about Amazon's impact on the larger economy and the ways it treats its workers.



Businesses urge Trump admin. against Postal Service rate hikes
The Hill

URL: https://thehill.com/business-a-lobbying ... rate-hikes
Category: Business
Published: September 12, 2018

Description: A group of major businesses is warning the Trump's administration's against making reforms to the U.S. Postal Service (USPS) that would inflame tensions with online retailers like Amazon. The Coalition for a 21st Century Postal Service wrote Wednesday in a letter to Treasury Secretary Steven Mnuchin that raising package rates and privatization should be off the table in an administration task-force review of the financially strapped USPS. "We respectfully urge you, Mr. Secretary, to keep these notes of caution in mind as the task force reaches its conclusions and makes its recommendations to the president and ultimately the Congress," wrote Art Sackler, the head of the coalition. The Treasury Department is in charge of the task force reviewing the USPS' operations. Sackler's letter said privatizing the Postal Service "would be a severe mistake" that could lead to severe cuts throughout parts of the country. Package shipments "the lone bright spot" for the USPS, Sackler said. The coalition, which represents major mailers such as Amazon and Bank of America, argued raising rates would be an "equally mistaken" move that would starve the Postal Service of money by driving business to use other delivery services. The business community is renewing pressure on the Trump administration after officials delayed the release of a long-awaited task-force report that could have criticized the rates Amazon and other companies pay for package delivery. President Trump ordered the review in April after he accused Amazon, without evidence, of treating the Postal Service as its "delivery boy" by paying less than it should for package delivery. Some business leaders fear that Trump is planning to use the task force to raise package rates as a way of retaliating against Amazon founder Jeff Bezos, who also owns The Washington Post. Trump has long complained about the Post's coverage of his presidency. The USPS is in deep financial trouble, reporting a net loss of $2.7 billion in fiscal 2017. But those losses have been largely driven by a steep decline in first-class and marketing mail and increased package deliveries have helped stem the losses. The coalition and other groups want the administration task force to endorse bipartisan legislation in the House and Senate that would overhaul the USPS's pension and healthcare payment system, which it says would better shore up its finances. Trump was briefed last month on preliminary findings from the task force but the report's public release was put on hold. "The task force will continue our work to identify solutions to strengthen the USPS business model driving toward a public report before the end of the year," a Treasury Department spokesperson said last month. "It is clear that the governance of USPS must be fixed and we encourage Congress to take actions towards that goal."



Bezos rips Trump for ‘dangerous’ attacks on the media
The Hill

URL: http://thehill.com/homenews/media/40666 ... -the-media
Category: Politics
Published: September 14, 2018

Description: Amazon founder and Washington Post owner Jeff Bezos sharply criticized President Trump on Thursday over his treatment of the news media, urging the president not to "demonize" members of the press. During remarks made at The Economic Club of Washington, the billionaire called on Trump to tone down his "dangerous" rhetoric aimed at reporters and news publications, AFP reports. "It's dangerous to demonize the media," Bezos said. "It's dangerous to call the media lowlifes. It's dangerous to say they are the 'enemy of the people.' " "We live in a society where it's not just the laws of the land that protect us," he added. "It's also the social norms that protect us. It works because we believe the words on that piece of paper." Bezos, who Forbes lists as the richest person in the world with a net worth of more than $100 billion, went on to say that the overall health of the media in the U.S. would be "fine" and would survive Trump's consistent criticism and cries of "fake news." "We are so robust in this country. The media is going to be fine," Bezos said, according to AFP, before paraphrasing Post editor Marty Baron: "The administration may be at war with us, but we are not at war with the administration." Trump has frequently made Bezos and The Washington Post top targets for his criticism of the press and has often attacked the newspaper and other media outlets for publishing accounts and quotes from anonymous sources inside his White House. "The Washington Post is constantly quoting 'anonymous sources' that do not exist," Trump wrote on Twitter last month. "They are a disgrace to journalism but then again, so are many others!" The president has also targeted Bezos's business, Amazon Inc., over the company's relationship with the U.S. Postal Service, which Trump claims to be an example of Amazon taking advantage of the federal government. “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 [sic] by the American Taxpayer. Many billions of dollars. P.O. leaders don’t have a clue (or do they?)!” Trump tweeted in April.



Trump administration recommends postal reforms that could raise rates, setting up fight with Amazon
The Hill

URL: https://thehill.com/homenews/administra ... aise-rates
Category: Politics
Published: December 4, 2018

Description: The Trump administration on Tuesday called on the U.S. Postal Service (USPS) to make sweeping reforms that could raise shipping rates for certain packages, a move that could inflame tensions with online retailers like Amazon, a frequent punching bag for President Trump. The administration's USPS task force said in a new report that the changes are needed to bring in more revenue for the cash-strapped Postal Service, which reported $3.9 billion in losses in fiscal 2018. “Although the USPS does have pricing flexibility within its package delivery segment, packages have not been priced with profitability in mind,” reads an executive summary of the report. The Treasury Department-led task force said the Postal Service should be able to charge higher rates for e-commerce goods and other packages deemed “nonessential,” which are a fast-growing part of the USPS's business. The proposed changes were the result of a process Trump initiated in April, after he accused Amazon of ripping off the Postal Service with what he called a sweetheart shipping deal that turned the USPS into its “Delivery Boy.” “I think Amazon has the bargain of the century with the U.S. Post Office, which is losing a fortune,” Trump said last month in an interview with the conservative Daily Caller. Trump's frustration with the agreement appears spurred on by his animosity toward Amazon founder Jeff Bezos, who also owns The Washington Post. The president has bashed the paper's coverage of him and accused Bezos of using it as a lobbying arm for Amazon, a claim both deny. “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!” Trump tweeted in March, days before assembling the task force. “That does not include the Fake Washington Post, which is used as a ‘lobbyist ’ and should so REGISTER.” Amazon on Tuesday did not respond to a request for comment. Trump administration officials pushed back on the notion the proposal was aimed at Amazon. "None of our findings or recommendations relate to any one customer or competitor of the Postal Service," said one senior administration official, who requested anonymity to discuss the report before its release. The official added that "all companies" dealing in e-commerce, "including Amazon," would "be impacted by those suggested reforms." The report recommends mail and package shipments be divided into essential and commercial service categories. Many online retail shipments would fall into the latter category, which would not be protected by existing price caps and thus be subject to rate increases. It also calls on the USPS to redefine what should be covered by the universal service obligation, which requires the Postal Service to deliver everywhere in the U.S. Under the administration's proposal, most commercial packages would not be covered by that obligation. The existing system, the report says, does not correctly assess the cost of delivering packages for retailers such as Amazon. "The USPS’s current cost allocation methodology is outdated, leading to distortions in investment and product pricing decisions," it reads, adding that the structure does not "capture the cost implications that the rapid decline in mail volume and the rapid rise of package volume have had on the USPS’s cost structure." Senior administration officials say the Postal Service and Postal Regulatory Commission (PRC) would be able to change package rates without an act of Congress. But such a move would likely require reworking negotiated service agreements with Amazon and other companies, which could be a contentious process. A coalition of major U.S. shippers, including Amazon, said the recommendations, if adopted, would drive up package prices and leave service gaps in remote areas. "By raising prices and depriving Americans of affordable delivery services, the Postal Task Force’s package delivery recommendations would harm consumers, large and small businesses, and especially rural communities," said former Rep. John McHugh (R-N.Y.), the coalition's chairman. Art Sackler, head of the Coalition for a 21st Century Postal Service, argued the changes could hurt the Postal Service's shipping business by driving online retailers to private competitors such as FedEx and UPS. "Driving up prices on packages will make USPS less competitive and incentivize competitors and customers to more rapidly divert USPS volume out of the system," he said in an email. The report was not limited to package policies and covered several other areas where the task force believes the USPS could shore up its finances. It called on the Postal Service to restructure massive prepayments of employee retirement and health benefits, which business groups say is the main driver of its fiscal woes. But it stopped short of endorsing bipartisan legislation that would dramatically scale back the prepayments, saying that doing so would place too much of a burden on taxpayers. The task force is also recommending that the USPS strengthen its internal management, giving more power to the board of governors to set fiscal targets and allowing the PRC to enforce stricter rules if the goals are not met. It declined to endorse privatizing the Postal Service, a proposal that was initially floated by the administration earlier this year as part of a broader plan to reorganize the federal government. The Postal Service has lost money for more than a decade, as the rise of email has significantly cut the volume of traditional, first-class mail. The task force said the USPS currently has a net deficit of $62 billion. The task force initially wrapped up the bulk of its work in August, submitting preliminary findings to the president. But the public release was delayed several months until Tuesday.



Trump mocks Amazon's Bezos as 'Jeff Bozo'
The Hill

URL: https://thehill.com/homenews/administra ... -jeff-bozo
Category: Politics
Published: January 13, 2019

Description: President Trump on Sunday night mocked Amazon CEO Jeff Bezos as "Jeff Bozo" in a tweet slamming The Washington Post, which Bezos owns. "So sorry to hear the news about Jeff Bozo being taken down by a competitor whose reporting, I understand, is far more accurate than the reporting in his lobbyist newspaper, the Amazon Washington Post," Trump tweeted. "Hopefully the paper will soon be placed in better & more responsible hands!" Trump's tweets came shortly after The National Enquirer came out with the latest in a series of articles about Bezos's divorce from his wife of 25 years. American Media Inc., the parent company of the National Enquirer, is controlled by Trump's longtime friend David Pecker. American Media, Inc. in December admitted that it paid $150,000 to a woman "in concert with" Trump's campaign "in order to ensure that the woman did not publicize damaging allegations about the candidate before the 2016 presidential election." The company agreed to cooperate with federal prosecutors. Trump last week wished Bezos "luck" on his divorce. "It’s going to be a beauty," Trump added. The president regularly antagonizes Bezos, criticizing both Amazon and the Post. He has multiple times suggested that the paper lobbies for Amazon.



Bezos's head-on challenge of National Enquirer is right call
The Hill

URL: https://thehill.com/opinion/campaign/42 ... right-call
Category: Politics
Published: February 8, 2019

Description: The ongoing war between President Trump and Jeff Bezos, CEO of Amazon and owner of Washington Post, is one not-so-ironically being fought in the media. The president isn't on the front lines on this one, of course; instead, American Media Inc, the parent of the famed (or infamous) National Enquirer is attempting to blow Bezos's personal integrity into oblivion.

enquirer-bezos-divorce.jpg

According to Bezos, AMI is trying to extort him. And since this is Washington, it is attempting to do so through nude photos of the richest man in the world. (He is valued at $135 billion, thanks mostly to Amazon.) Most of you have seen this movie up until this point: The president believes Bezos and the Washington Post are among his biggest adversaries. Just as big as special counsel Robert Mueller or House Speaker Nancy Pelosi or CNN, thanks to the Post's overwhelmingly negative coverage of him and his administration. The president has made his sentiment toward Bezos and Amazon abundantly clear. "Amazon is doing great damage to tax paying retailers," Trump tweeted in August 2017. "Towns, cities and states throughout the U.S. are being hurt - many jobs being lost!" But Bezos chose a much different, almost unheard-of approach in taking AMI and the Enquirer head on through an unfiltered blog post on Medium titled, "No thank you, Mr. Pecker." "Something unusual happened to me yesterday. Actually, for me it wasn’t just unusual — it was a first," Bezos wrote. "I was made an offer I couldn’t refuse. Or at least that’s what the top people at the National Enquirer thought. I’m glad they thought that, because it emboldened them to put it all in writing. Rather than capitulate to extortion and blackmail, I’ve decided to publish exactly what they sent me, despite the personal cost and embarrassment they threaten." Bezos then went so far as to share a letter written to him by Dylan Howard, the chief content officer of AMI. The letter lays out in specific detail what kinds of photos AMI said it possessed of Bezos and his alleged mistress. Bezos and his wife, MacKenzie Bezos, are getting divorced after 25 years of marriage. "A naked selfie in a bathroom — while wearing his wedding ring. Mr. Bezos is wearing nothing but a white towel — and the top of his pubic region can be seen" is one of several photo descriptions Howard provided. "A below the belt selfie" is another. "It would give no editor pleasure to send this email. I hope common sense can prevail — and quickly," Howard concludes, without specifically stating what "common sense" is supposed to lead to. So Bezos had essentially two options: Handle the matter privately, or burn the whole place down in a noble, selfless act that possibly exposed himself to being exposed. He chose the latter — and didn't just release a static statement written by a lawyer or communications expert but, instead, a from-the-heart explanation, complete with the letter he received from AMI that had to be humiliating to absorb initially. Writing a blog is the correct call. It is, ironically, a Trumpian move to avoid the so-called media filter and go directly to the people, in the most candid way possible. And in doing so, it exposes what kind of tactics AMI is choosing to deploy here that have almost nothing to do with journalism but, rather, represents the politics of personal destruction under the guise of journalism. The New York Post put it best on its front cover on Friday: "Bezos Exposes Pecker."

bezos-exposes-pecker.jpg

Yup. That about sums it up.



Reporter: Bezos investigator believes 'government entity' may have obtained texts
The Hill

URL: https://thehill.com/policy/technology/4 ... e-obtained
Category: Politics
Published: February 8, 2019

Description: A reporter at The Washington Post says that an investigator hired by Amazon CEO Jeff Bezos believes that text messages leaked to the National Enquirer between Bezos and his girlfriend may have been sent to the magazine by someone in government. In an appearance on MSNBC on Thursday, Post reporter Manuel Roig-Franzia said that Bezos's security consultant, Gavin de Becker, believes that the National Enquirer obtained text messages from Bezos through inappropriate means. Bezos on Thursday said in a blog post that the Enquirer was attempting to force him to call off his investigation of the tabloid under the threat of further texts being released. “They have begun to believe, the Bezos camp, that this publication by the National Enquirer might have been politically motivated,” Roig-Franzia said Thursday. “Gavin de Becker told us that he does not believe that Jeff Bezos’s phone was hacked, he thinks it’s possible that a government entity might have gotten hold of his text messages,” he added.

manuel-roig-franzia.jpg

De Becker's assertion that Bezos's phone was not hacked raises questions as to how staffers at the Enquirer obtained messages that were allegedly sent privately between Bezos and his rumored girlfriend, former TV anchor Lauren Sanchez. The Enquirer is owned by David Pecker, a top ally of President Trump. Pecker has been accused of helping the president kill unfavorable stories about his past affairs during the 2016 presidential race. Bezos and Trump have feuded publicly over Amazon and its relationship with the federal government, as well as over Bezos's ownership of The Washington Post, which the president says unfairly targets him with negative news coverage. In a Medium post Thursday night, the Amazon CEO vowed not to fall for "extortion" tactics from Pecker and American Media Inc., which owns the Enquirer. "Rather than capitulate to extortion and blackmail, I’ve decided to publish exactly what [American Media Inc.] sent me, despite the personal cost and embarrassment they threaten," Bezos wrote.
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Trump whacks CNN, 'Amazon' Washington Post, but they hit back

Postby smix » Wed Apr 04, 2018 3:29 pm

Trump whacks CNN, 'Amazon' Washington Post, but they hit back
Fox News

URL: http://www.foxnews.com/politics/2018/04 ... -back.html
Category: Politics
Published: April 4, 2018

Description: The president is once again on a tear against the press. He's been whacking CNN and the Washington Post, and so-called fake news in general, and getting plenty of pushback in return. While Donald Trump's disdain for the media is nothing new, I'm sensing a definite escalation in his tactics, and a growing willingness by some news organizations to accuse him of false statements. The president has used the press as a foil from the day he got into the race. As I detail in my new book "Media Madness," sometimes he does this as a political strategy; sometimes he's just venting, and at other times he's punching back at what he sees as unfair coverage. And there's no question the coverage has been overwhelmingly negative. But Trump also leaves his detractors an opening when he stretches the facts. The president's attacks on the "Amazon Washington Post" are a classic example. And I don't have to rely on unnamed sources to say that he has a bit of a fixation on Amazon and Jeff Bezos. He's brought it up with me a number of times, including in a 2015 interview on my show. (I posted the video in this "After the Buzz" segment.) Amazon stock has lost $60 billion since Trump began pounding the online giant on Twitter. He's made the argument that Amazon doesn't pay enough in taxes (the company paid nearly $1 billion in sales taxes last year) and is costing the Postal Service money (even if true, doesn't that mean the service isn't charging enough for all package deliveries?) Trump repeated the criticism in response to a reporter's question at a photo op yesterday. I'm troubled by the president singling out one company, and having a financial impact, because he doesn't like its CEO. His real beef is the Post, as he's told me and others. Trump tweeted about "the Fake Washington Post, which is used as a 'lobbyist' and should so REGISTER." Marty Baron, the Post's executive editor, said no one at the paper is paid by Amazon and that Bezos has told him to cover the company like any other business. "I can't say more emphatically he's never suggested a story to anybody here, he's never critiqued a story, he's never suppressed a story," Baron told the New York Times.

kurtz-trump-vs-media.jpg

As for CNN, it's personal between the president and network chief Jeff Zucker, who ran NBC when Trump hosted "The Apprentice." Trump tweeted yesterday: "Check out the fact that you can’t get a job at ratings challenged @CNN unless you state that you are totally anti-Trump? Little Jeff Zuker, whose job is in jeopardy, is not having much fun lately. They should clean up and strengthen CNN and get back to honest reporting!" CNN called the charge "false" on Twitter, saying: "The personal political beliefs of CNN's employees are of no interest to us. Their pursuit of the truth is our only concern. Also, Jeff's last name is spelled Z-U-C-K-E-R. Those are the facts." The Trump tweet didn't come out of the blue. It materialized after CNN White House correspondent Jim Acosta shouted two questions about DACA at the Easter egg roll, while the president sat with his son and other children. I have no problem with shouted questions—and Trump did answer the first one, before Acosta accused him of killing the program—but I think Acosta crossed a line by asking it in that setting. It's also no accident that the subject was DACA, an issue on which he often sounds more like an advocate than a journalist. Still, I thought Brad Pascale, Trump's 2020 campaign manager, went too far in tweeting: "Maybe it is time for Jim Acosta to get a suspension for breaking protocol." Such credentials are handled by the White House Correspondents Association, not the White House. Trump's attacks on the press invariably please his base, which doesn’t trust the news business either. But he’d have a better shot at expanding that base if he lowered the temperature a bit.
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As U.S. Postage Rates Continue To Rise, The USPS Gives The Chinese A 'Free Ride'

Postby smix » Wed Apr 04, 2018 4:46 pm

As U.S. Postage Rates Continue To Rise, The USPS Gives The Chinese A 'Free Ride'
Forbes

URL: https://www.forbes.com/sites/wadeshepar ... usa-cheap/
Category: Business
Published: November 5, 2017

Description: As the rates of the U.S. Postal Service continue on their precipitous ascent, how cheaply Chinese merchants are able to ship their products thousands of miles across the world to the United States has become emblematic of the stark trade imbalance between the countries as well as the disadvantages that American companies are up against as foreign competitors outmaneuver them in their own backyard. As you browse through the listings on sites like Amazon and eBay it is almost impossible not to be amazed at how cheaply China-based merchants are selling products for: xlr cables for $.99, a necklace for $.78, 10 watch batteries for $.78 -- all with postage included. Perhaps you may feel a little suspicious or even a touch indignant about these low prices, as you know that you can't possibly send packages for anywhere near this price internationally or, for that matter, even across the street. How cheaply the Chinese are able to ship products to the U.S. has become a mystery of sorts in online portals and message boards:
I've purchased several items on Ebay that came from China or Hong Kong. I bought a 4 pack of rechargeable batteries for 99 cents with free shipping. A 3 pack of ear bud extension cords with volume control for 89 cents with free shipping...The packages arrive withing [sp] 2 weeks with Chinese postage stamped all over them. How on earth can they sell these items so cheaply and then ship them all the way from Asia for under a buck?

However, it’s actually no secret as to how the Chinese are able to ship products abroad so cheaply. The reason is actually rather simple: They receive subsidized postage rates. But before you scoff and think this is just another example of Beijing disrupting fair trade and tilting the tables in support of their domestic producers, please realize that you’ve pegged the wrong government to be the recipient of your complaints. These super low shipping rates are being subsidized by the U.S. Postal Service. Yes, the United States and, in a roundabout way, the U.S. taxpayer is footing the bill so that Chinese merchants can ship their products to the USA for dirt cheap, essentially losing millions to support a dynamic where domestic American businesses are being undercut by foreign merchants who are immune to any and all intellectual property and consumer safety laws.
ePacket
In 2011, the U.S. Postal Service made special agreements with the national postal carriers of China and Hong Kong (and subsequently South Korea and Singapore) to allow tracking-enabled packages not exceeding 36” or weighing over 4.4 pounds to be sent to the U.S. for extremely low rates. They called this shipping option the ePacket, and the rates are so low that it's cheaper to ship small parcels from China to an American city than it is to send that same parcel domestically. As Amazon’s Vice President of Global Policy Paul Misener pointed out: “The cost to ship a one-pound package from South Carolina to New York City would run nearly $6; from Beijing to NYC: $3.66.” While sending that same one-pound package from New York City back to Beijing via USPS International Mail would cost in the ballpark of $50.
No returns
This state of affairs also makes Chinese merchants virtually immune to returns from U.S. customers, turning international e-commerce into a one-way street. As this unfortunate eBay shopper found out the hard way:
I bought an item from a seller in Hong Kong for $6 and $1.50 shipping. The item was broken so the seller told me to return for refund. The shipping weight is 5 ounces. To ship from the US to Hong Kong with the cheapest USPS service that has delivery confirmation (priority international) it will cost $34.87. To ship 1st class without tracking it will cost $11.48. How in the world did the China seller pay for the product, pay eBay and Paypal fees, pay for packing material, and ship to me WITH TRACKING for 1/4 of the cost it would cost me just in shipping costs alone to send the item back?

This drastic trade imbalance is severely exacerbated in the melee of global e-commerce, where merchants from around the world are put in direct competition with each other, often selling on the same platforms to the same customers, giving Chinese merchants a huge advantage over their domestic U.S. rivals, who are now being rendered obsolete on their own turf.
Counterfeiters
I’ve previously documented the struggles of Matthew Snow, who runs an innovative t-shirt design company called Boredwalk out of California, against Chinese counterfeiters who are stealing his designs and selling them on Amazon. Another side to that story is that Snow not only needs to compete directly against low-quality, low-price knock-offs of his own product but agencies of his own government are actually aiding and abetting the counterfeiters via these subsidized shipping rates. “Having to pay less for shipping decreases their overall cost to bring the product to the customer,” Snow explained. “It enables them to offer lower prices, an area where they already have an advantage due to incredibly cheap labor and immunity to all U.S. laws.” Becca Peter from Lopez Island in Washington state is in a similar situation. She sells something called Washi tape via a website called PrettyPackagesTape.com “at some of the lowest prices of any U.S.-based small business.” But these low prices are nothing compared to what Chinese competitors can sell at. While Peter must charge a flat $3.50 for shipping, Chinese merchants are selling versions of the product with all fees and and shipping charges included for a total price of $2. The situation for American merchants gets even more dire when they try to compete in the fray of international e-commerce. “It costs less than $4 to mail a 9-ounce parcel from China to Toronto or London. If I want to mail a 9-ounce parcel to Toronto it would cost me $14.73. If I wanted to send that same package to London it would cost me $21.38,” Snow exclaimed. Cross-border e-commerce is currently one of the fastest growing economic sectors on the planet, but it is one that U.S.-based entrepreneurs cannot hope to compete in due to the extreme disparity of shipping rates. While Jack Ma talks a big game about trying to get more U.S. merchants selling on his platform in China, it's pretty much a moot point considering that current international shipping rate conventions makes American merchants uncompetitive from the start. The impact of this international postal rate imbalance for the USPS is dire. As pointed out in an article on the Washington Post, the USPS loses around a dollar on each ePacket coming in from China. The USPS Inspector General admitted that his agency lost $75 million handling mail from foreign shippers in 2014 alone.
Free ride
Overall, the postal service of the U.S. is getting financially demolished on all fronts, recording losses of over $60 billion since 2007, with $5.6 billion of this coming in fiscal year 2016. As a stopgap, they continuously hike rates for U.S.-based shippers. In January 2017, the cost of first class mail was significantly raised. In September, a new price category was added for lightweight parcels, which essentially boosted the cost to ship them by 12%. This coming January, the rate of first class mail will go up again, crossing the psychological threshold of 50 cents to send a letter domestically, not to mention higher prices to send anything heavier. Essentially, U.S. shippers are partially paying higher shipping rates to make up for the hit the USPS takes giving subsidies to the Chinese. “It just adds insult to injury to watch our postal rates continue to climb while China is being given a free ride to siphon all this money out of our economy,” Snow exclaimed in exasperation. There are also broader economic repercussions to the onslaught of Chinese e-commerce entering the U.S. market. To put it simply, an end consumer buying products directly from China does just about nothing for the U.S. economy -- unless you figure in the cuts that platforms like Amazon and eBay take on these sales -- and millions and millions of dollars are flowing out of the country each year because of this. Meanwhile, China profits $40-$60 billion each month due to its import/export imbalance, something which will probably grow even larger as China continues development on an array of “cross-border e-commerce zones” -- new, Beijing-fueled urban developments specifically geared towards assisting Chinese merchants with selling and shipping their products abroad even more than they already are. Basically, Beijing appears to be using international e-commerce as a tool to suck billions and billions of dollars out of other countries. It is an understatement to say that the USPS ePacket product is not popular in the U.S. In fact, it is generally universally despised by U.S. retailers, private shipping firms like UPS and FedEx, e-commerce platforms like Amazon, and even the USPS alike. The reason why it exists isn’t because the USPS wants to give a helping hand to the hardworking merchants of China, but due to what the Washington Post dubbed a “quirk in an international treaty.” International postage rates for incoming packages are set by a U.N. agency called the United Postal Union (UPU). This is a body that was established in 1874 -- subsequently being absorbed into the U.N. -- that is currently made up of 192 countries which meets every four years to revise its policy and set new terminal fees, with each country getting one vote a piece. While the voting system of the UPU is egalitarian, the shipping rates that it sets are not. According to Nancy Sparks of FedEx Express (via eCommerceBytes.com), the rate structure of the UPU is a system where the “haves pay the have-nots.” Essentially, countries that it deems to be poorer or less developed pay less for shipping to countries that are categorized as being richer. So someone shipping from, say, China, will pay significantly less to ship to a country like the U.S. than an American shipper will pay to send that same package to China. As covered by Arthur Herman for the National Review:
Under current rules, those charges (called terminal dues) are set ludicrously low for certain countries, among them China. (Under UPU rules, for example, China, the world’s second-largest economy, gets the same break on terminal dues as do Gabon and Botswana.) This means that the USPS actually charges China Post less to deliver a package from China into the U.S. than it charges a U.S. business or customer to deliver a similar size package within the 48 states. The post office is losing money on every package it delivers from China — costs it has to pass on to its own American customers, not to mention U.S. taxpayers.

With the rapid rise in global e-commerce and the sudden economic success of countries who were once dubbed "third world" flipping the script on the glacial UPU, the USPS endeavored to come up with product that would improve their margins when dealing with the massive amount of small packages that suddenly began flowing in from China. They came up with the ePacket, which is actually meant to be an improvement over the rates set by the UPU. In exchange for providing tracking and faster delivery times, ePacket partner countries agree to pay slightly higher rates. However, the price difference works out to be relatively marginal and doesn’t do anything to level the playing field for domestic U.S. sellers, who still pay more so the Chinese can pay less.
Chinese sellers flooding market
While many have criticized the USPS for creating a product which ultimately hurts their own margins along with those of tens of thousands of U.S. businesses, they ultimately don’t have much leverage: if they whine and complain too loudly China can simply abolish the ePacket program and revert to the lower rates laid out by the UPU. This issue is now growing to epic proportions as Chinese sellers flood into marketplaces like Amazon and Ebay, displacing domestic U.S. merchants in droves. On Amazon USA alone, Chinese merchants are now reputed to have a 25% marketshare, as the once proud American e-commerce platform is beginning to resemble something akin to an Yiwu junk market. It has been well documented that the playing field of global e-commerce is drastically tilted in favor of Chinese merchants. They have direct access to a sprawling, diverse, and extremely versatile manufacturing ecosystem that enables them to make products cheaper and faster than pretty much any Western company. They don't need to comply with American IP laws -- they can counterfeit anything they want with full legal impunity -- labor standards, and even consumer safety regulations. To put it simply, they can compete directly against U.S. companies and sell directly to U.S. citizens without needing to follow any of the rules. If this wasn’t bad enough, comes the insult to injury that these foreign merchants are being subsidized by the U.S. Postal Service. “It makes me angry,” Matthew Snow exclaimed. “Why should we Americans be subsidizing costs for Chinese businesses? If anyone should be getting shipping discounts from our nation's postal service it should be Americans, not bad actors from foreign nations.”



Why Amazon And Rival Retailers Are Uniting To Defend The U.S. Postal Service
Forbes

URL: https://www.forbes.com/sites/andriachen ... 02a6f27bc8
Category: Business
Published: August 5, 2018

Description: Many U.S. retailers may hate and fear Amazon.com, but their shared interest in making sure the U.S. Postal Service continues to offer “reliable and affordable” package delivery — critical to all retailers in this age of growing e-commerce — tops all that regular business enmity. Amazon and the National Retail Federation, the top retail trade group representing retailers including Walmart and Target have joined with other individual retailers and businesses to create the Package Coalition, a lobbying group seeking to educate and give facts about the state of the USPS’s package business. (Amazon is also an NRF member.) The news of the advocacy group, announced Wednesday, came ahead of a report expected to be released later this week from a task force President Trump created in an April executive order to study the money-losing U.S. Postal Service for possible reform. Trump has also publicly attacked Amazon in many tweets, including calling the USPS Amazon’s “delivery boy” and suggesting without any evidence that the special rate break that Amazon and other package shippers got led to the USPS’s loss. Trump's comments have raised concerns about potential package rate hikes and reduced postal service at a time when so-called last-mile delivery is a high-stakes battleground for retailers meeting the demands of growing online shopping. Key to this is the USPS’s delivery service to all U.S. addresses, especially in rural markets, which even giants like Amazon rely on. “Here are the realities of the Postal Service’s packaged business: It is one of the very few bright spots of the U.S. Postal Service,” John McHugh, chairman of The Package Coalition, said in an interview, adding that while the USPS in aggregate has posted losses, the package segment contributed $7 billion to its bottom line last year. “All of our members provide solid financial footing to the Postal Service. The last thing you want to talk about is disrupting one of the few bright spots of the Postal Service.” McHugh should know. A former Republican congressman and a former secretary of the U.S. Army under President Obama, he said he’s been involved in Postal Service issues since 1995.
Just How Important Is The Postal Service In Rural Markets?
“The U.S. Postal Service has 157 million delivery points,” McHugh said. “No other organization in America has that kind of reach and penetration. Particularly in rural environments, it’s absolutely essential. In the era of e-commerce, it’s even more crucial. For rural community residents and small businesses, the only way they can afford to get that is through the Postal Service.” Some 24,000 zip codes, representing more than half of the 42,000 zip codes in the U.S., are assigned to the rural areas, he told me. When you total up the USPS's deliveries to both rural residential and rural business addresses, its rural penetration was about 28% of the 157 million delivery points, according to data in the USPS’s fiscal 2017 annual report. Even though Amazon and other large package shippers get a bulk rate from the USPS, how much they ship and pay still has to not only cover the USPS’s cost but also contribute to paying the rest of its overhead, McHugh said. MuHugh's points bear out in the USPS’s annual report, which said the prices it charges for package shipping “must cover costs attributable to each product” and “must contribute a reasonable share” of its “institutional costs.” “We enabled America’s continuing e-commerce growth by giving customers unprecedented visibility and competitive shipping solutions that reach every door in America every delivery day,” Megan Brennan, the postmaster general and the USPS’s CEO, said in the annual report, adding that the Postal Service is “self-funded” and “receives no tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations.” She has also pushed back against Trump's demands that the USPS double the rate it charges Amazon and others, arguing that the USPS's relationship with Amazon is "beneficial," as reported by The Washington Post, which is owned by Amazon CEO Jeff Bezos and is another routine target of Trump's attacks. To be clear, the Package Coalition is independent of the USPS and isn’t “coordinating with the Postal Service” in its lobby efforts, McHugh said.
The Package Segment: A Big Bright Spot For The USPS
Based on data in the USPS’s annual report, the shipping and package segment is indeed one big bright spot for the USPS: It’s the only segment that has seen increased revenue each year since at least fiscal 2014. By contrast, revenues from first-class mail, marketing mail and periodicals have declined over the same period, reflecting the less frequent sending of letters and cards in the age of emails and other electronic communication as well as a decline in the mailings of catalogues, print circulars and magazine subscriptions. As consumers continue to spend more online, the USPS forecasts shipping and package revenue this fiscal year will rise to $21.4 billion, an increase of 60% since fiscal 2014. On the other hand, first-class mail, while still the largest USPS segment, will see its revenue decline by about 10% over the same period to nearly $25 billion in fiscal 2018. By the number of pieces sent, the same sharp contrast between the package business and others also holds true. The report showed the USPS posted a loss not because of package shipping: In addition to lower revenue from first-class and other mail services, there was an increase in unfunded retirement benefits and in costs for employee compensation and benefits. The USPS has incurred $65 billion of cumulative losses since the 2007-09 recession, according to the executive order, which added that the Postal Service has been unable to make payments required by law for its retiree health benefit obligations.
USPS 'Hits Every Citizen Of The U.S.'
“Package delivery is making money for the Postal Service,” Jon Gold, NRF’s VP of Supply Chain and Customs Policy, said in a separate interview. “The Postal Service is an integral part of that last-mile delivery. USPS is a major part of the retail supply chain. Rural markets are a key differentiator for USPS: It hits every citizen of the U.S.” Gold confirmed that retailers are concerned that postal delivery rates may go up, along with a cut in delivery service. “We are speaking on behalf of the industry,” he said. “We’ve heard from several (NRF) members: If the rates go up, the rates will have to be passed along to consumers.” While Amazon may be drawing the biggest attention, McHugh said that each member of the coalition, which came together in the last two months, is an “equal member” with an “equal voice.” “There’s no leader,” he told me. Amazon didn't respond to a request for comment. The coalition is talking to “a broad range of similar companies,” including “a number of well-known retailers,” about joining individually. McHugh said he’s “reasonably optimistic” more will join. Other announced coalition members include shopping network QVC, Columbia Sportswear, pharmacy benefit manager Express Scripts, package shipping service OSM Worldwide, mailing service and equipment maker Pitney Bowes and Publishers Clearing House. As to what’s next for the coalition, McHugh said that between Wednesday and Friday, he had already sent emails to dozens of members of Congress, with more to go. The coalition has also sent a letter to the president’s task force to present some data and will make “targeted information effort in certain states.” “It’s not that we have any argument with the task force or executive order,” McHugh said. “Our involvement is to make sure all the facts are well known.”
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Trump wants 'level playing field' on Amazon

Postby admin » Wed Apr 04, 2018 7:43 pm

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Trump's feud with Amazon is really about the Washington Post's success

Postby smix » Thu Apr 05, 2018 3:46 pm

Trump's feud with Amazon is really about the Washington Post's success
The Guardian

URL: https://www.theguardian.com/commentisfr ... jeff-bezos
Category: Politics
Published: April 5, 2018

Description: The paper owned by Amazon’s CEO, Jeff Bezos, has relentlessly investigated the president and Trump is out for revenge
Donald Trump’s savage attacks on Jeff Bezos and Amazon mark a sharp escalation in the president’s attacks on the free press. Trump v Bezos is really a proxy war: the president’s ultimate target is the Washington Post, which Bezos purchased from the Graham family in 2013. The Post’s return to financial health since 2013 has been good for the media, which thrives on healthy competition. Since Trump became president, the Post and the New York Times have engaged in a thrilling, old-fashioned newspaper war, with each trading off, day after day, with deeply reported stories and scoops that hold the Trump administration to account. The Post has been relentless in investigating the Trump administration’s abuse of power and the Trump campaign’s possible collusion with Russia during the 2016 election. Bezos isn’t known for ideological fervor or partisanship. He gave donations to support gay marriage in his home state, the other Washington, but hasn’t had a high political profile. Since the 2016 campaign, when Trump began attacking him on Twitter, Bezos has displayed restraint. Despite the escalating bitterness of Trump’s tweets about him, Bezos has avoided being positioned as Trump’s nemesis. To maintain its newly recaptured global credibility, the Post can’t be seen as the opposition party. Of all of Trump’s attacks on Bezos, the most poisonous lie is that he uses the Post to lobby for Amazon. When Bezos bought the paper, he did so with personal funds, to keep the newspaper’s interests and mission completely separate from Amazon’s. The Grahams would not have found him a fit owner if they thought Bezos wanted to use the Post to wield influence. According to the many journalists who work there, Bezos has had a light touch as owner, focusing on areas in which he can make a difference, such as improving the paper’s technology. He has entrusted the running of the paper to Marty Baron, hired by the former publisher Katharine Weymouth, whose contributions to safeguarding her inheritance have been insufficiently credited and appreciated. If newspapers were originally foreign to Bezos, the Post’s special place in the history of American journalism has come to have great meaning for him, according to several close associates. In 2017, he purchased an antique clothes wringer, which is now displayed in a conference room at the Post’s downtown Washington DC headquarters that is dedicated to the Graham family. The significance of the wringer is known by any student of Watergate. Furious over the Post’s coverage of Richard Nixon’s criminal cover-up, the then attorney general, John Mitchell, threatened that “Katie Graham’s gonna get caught in a big fat wringer” if the Post continued publishing its Watergate stories. For years, Katharine Graham proudly wore a charm of a wringer on a necklace as the golden symbol of her defiance. Graham risked financial ruin by standing up to Nixon. Bezos, too, has much at risk. After a week of attacks from the president, Amazon saw its stock price drop sharply (though it later recovered somewhat). Bezos’s stratospheric net worth also took a hit. There is real reason to fear that Trump can win his war against the press. He has significant allies, including Rupert Murdoch’s Fox empire and Sinclair Broadcasting, which controls local television stations across the country and is seeking to acquire more through a planned purchase of the Tribune Company. Fox and Sinclair are conservative propaganda machines, eager to amplify Trump’s lies and support him at the barricades. The chorus of Sinclair newscasters spouting the same, Trump-inspired attacks on reputable news providers as “fake news” was nothing short of chilling. A recent poll showed that a majority of Americans agree with the president’s rants about “fake news”, More than three in four among 803 American respondents, or 77%, said they believed major traditional television and newspaper media outlets report “fake news”, according to a Monmouth University poll released Monday. It is the hour for Americans to stand up for the first amendment and to stand against the Foxes and Sinclairs. They should also stand with the Washington Post. The president has very real legal, regulatory and spending tools at his disposal to retaliate against Bezos and Amazon for the Post’s unflinching coverage. On the radical end of the spectrum, there are antitrust laws to unfurl to break up the tech retail giant, which Trump says is wiping out Mom-and-Pop stores across America. There are regulatory tools, including demanding stricter privacy rules. There are billions in government contracts for cloud computing that could disappear. Amazon is no angel, but Trump’s urge to punish it is for all the wrong reasons, triggered by his churlishness over the Post’s coverage of him and his administration. All of this could create a confrontation with the potential to be every bit as dramatic as Graham’s clashes with Nixon in the 70s. But as was true then, the president may end up being on the losing end of a White House war against the press.



Kimmel on Trump v Amazon: 'He's jealous because Jeff Bezos is actually a billionaire'
The Guardian

URL: https://www.theguardian.com/culture/201 ... illionaire
Category: Entertainment
Published: April 4, 2018

Description: Comics discussed Trump’s attacks on Amazon and his statement about the state of US-Russia relations
Late-night hosts on Tuesday discussed president Trump’s attacks on Amazon and its owner Jeff Bezos, as well as his comments regarding the administration’s relationship with the Kremlin. “The president has been lashing out at Amazon this week, repeatedly,” Jimmy Kimmel began. “He says Amazon has been taking advantage of the US Postal Service after he claimed the post office loses $1.50 for every Amazon delivery which, by all accounts, isn’t true.” “He tweeted this one-star review of Amazon defending that,” the host continued, reading Trump’s tweet aloud: “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?)!”

kimmel-trump-amazon.jpg

“Why insult the people at the post office by calling them Amazon’s delivery boy?” Kimmel replied. “They deliver things, that’s what they do!” The host went on to explain that Trump’s vendetta against Amazon, which has lost $60bn in valuation since Trump began attacking them, spawns from the company being owned by Jeff Bezos, who also owns the Washington Post. “And also Trump is jealous because Jeff Bezos is actually a billionaire,” Kimmel joked. Meanwhile, NBC’s Seth Meyers touched on a number of stories having to do with Trump, including his latest comments on US-Russia relations, the Stormy Daniels scandal and his criticisms leveled against Amazon. “President Trump said today that nobody’s been tougher to Russia than Donald Trump,” Meyers began. “And Vladimir Putin said: ‘It’s true, he’s been a terrible employee.’” “Never come to work, always golfing,” the host joked in a Russian accent. “I’m starting to think he doesn’t speak in the third person,” Meyers said. “He just has no idea who Donald Trump is.” Meyers then noted that on Tuesday Trump nicknamed former president Barack Obama for the first time, referring to him as “Cheatin’ Obama” in a tweet about approval ratings.



“That’s a pretty lame nickname,” the host said. “You know what’s a cool nickname? Stormy.” Referring to Stormy Daniels, who sued Trump to be released from a non-disclosure agreement he never signed, Meyers went on: “President Trump’s legal team has asked a federal judge to force arbitration over this alleged hush agreement with adult film star Stormy Daniels, which would cause the case to be conducted entirely behind closed doors and out of the public eye.” “Which means we may just have to rely on Trump’s own personal courtroom sketches,” Meyers joked, showing a drawing of two stick figures. Finally, the host brought up Trump’s tweets about Amazon, which began on Monday when Trump said of the postal service: “They lose a fortune.” “This is when I appreciate Twitter,” Meyers said. “It used to be if you wanted to hear a 71-year-old man whining about the post office, you had to go to the post office.”



What is the Donald Trump v Jeff Bezos feud really about?
The Guardian

URL: https://www.theguardian.com/us-news/201 ... taxes-usps
Category: Politics
Published: April 7, 2018

Description: Trump’s obsession with Bezos is cutting the value of US tech stocks – and the source of his irritation is more than just ‘an uneven playing field’
One is the world’s richest man, the other is the world’s most powerful. Together they are locked in a personal feud that is shaving billions off the value of US tech stocks. But is Donald Trump’s onslaught against Amazon chief Jeff Bezos really about the president’s concern that the United States Postal Service (USPS) is getting a raw deal for delivering Amazon parcels? Or is the source of his extreme irritation actually the Washington Post, the rejuvenated Bezos-owned title which has held the president and his administration to account under a portentous masthead line which reads “Democracy dies in darkness”? For much of last week, Trump has been raging against his new favorite target, Amazon – accusing the company of putting “fully tax paying retailers” out of business, and using the USPS as its “Delivery Boy” at the expense of American taxpayers.
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!
– Donald J. Trump (@realDonaldTrump) - March 29, 2018

He has also chided “The Fake News Washington Post”, Amazon’s “chief lobbyist”, railing against what he sees as its many “phony headlines” and bad reporting. His Twitter rants continued in person as he addressed reporters on Air Force One, telling them: “Amazon is just not on an even playing field. They have a tremendous lobbying effort, in addition to having the Washington Post … What they have is a very uneven playing field.” Amazon stock has dropped from a $1,600 high on 12 March to $1,443 now. That is a $73bn drop in market capitalization over the past month. Based on estimates of Bezos’s stock holdings, the Amazon founder may have lost $16bn from his personal fortune, the world’s largest, over the same period. For now, Bezos isn’t reacting. “I would not have bought the Washington Post if it had been a financially upside-down salty-snack-food company,” he told Fortune magazine in 2016. Trump says the title is “used as a ‘lobbyist’ and should so REGISTER”. But the Washington Post has consistently rejected suggestions that Bezos has a hand in the paper’s editorial decision making. Publisher Frederick Ryan Jr said in a Post analysis that its proprietor has “never proposed a story”. “Jeff has never intervened in a story. He’s never critiqued a story. He’s not directed or proposed editorials or endorsements,” Ryan said. Last week, Wells Fargo analyst Ken Sena estimated that for $250m the paper cost Bezos personally in 2013, the purchase could end up costing Amazon $75bn. But if Trump is hoping to pressure regulators to make a case against the company, it would ultimately fail. “We don’t see how the current presidential rhetoric helps a US case against Amazon,” Sena wrote. The online retailer has reportedly doubled its number of in-house lobbyists from 14 to 28 since Trump’s election, more than double that of Facebook or Apple. While Google spends more on lobbying ($18m in 2017 to Amazon’s $12m), Amazon’s lobbyists span its sprawling interests: drones, autonomous vehicles and air cargo, cybersecurity, data privacy and intellectual property and cloud computing. Big tech’s Washington lobby presence parallels its growing vulnerability as, one by one, the tech giants are drawn into political disputes, with Facebook next in the spotlight: CEO Mark Zuckerberg is due to appear before Senate and House committees next week to answer questions on its failures to protect users’ data. Dean Garfield, president and CEO of the Information Technology Industry Council, a global lobbying group for tech companies, said that big tech is preparing for battles ahead. “The question is no longer whether this is an intellectual exercise,” he said. “There is the Washington bubble/elite conversation about techlash, and there is real consumer concern around a host of issues, including how the tech sector uses and enables control over data.” How those two conversations now join together is dependent to some degree on the president and how his populist, anti-Amazon agenda plays with the political mainstream that is now looking at ways to limit the power of big tech companies. Larry Kudlow, Trump’s new economic adviser, appears to back the president’s assault on Amazon. “I just think he wants a level playing field with respect to taxing,” Kudlow told Fox Business on Thursday. Kudlow’s remark seemed to ignore Trump’s own assertion during the presidential campaign that his own record of paying zero tax “makes me smart”. Kudlow was referring to Amazon’s tax advantages. Since its beginnings as an online bookseller in 1994, Amazon has taken an independent approach to taxes, collecting no state sales tax for many purchases until recently, and still does not pay local tax in some cases. Moreover, Amazon is not always obligated to raise sales tax on sales through third party vendors, giving both vendors and Amazon advantages over brick-and-mortar retailers already suffering from changes in consumer habits. Then there is the issue of the post office. According to Trump last Sunday: “the U.S. Post Office will lose $1.50 on average for each package it delivers for Amazon. That amounts to Billions of Dollars.” He continued into the week. “I am right about Amazon costing the United States Post Office massive amounts of money for being their Delivery Boy,” Trump said on Twitter. “Amazon should pay these costs (plus) and not have them bourne [sic] by the American Taxpayer.” The reality is more complex. Over the past decade, the USPS has lost around $60bn despite a 60% increase in shipping and package revenue. Amazon’s contract with USPS isn’t public, but its use of the postal service to deliver packages for “last mile” delivery has helped the service make up for a steep drop in the volume of letter mail it delivers. In other words, the USPS needs more Amazons, not fewer. According to Vanity Fair, Trump is discussing new ways to escalate his attacks. “He’s off the hook on this. It’s war,” one source told the magazine. “He gets obsessed with something, and now he’s obsessed with Bezos,” said another. But how far can he take the fight? Trump conjoined the Washington Post and Amazon into a single enemy with a tweet in December 2015, immediately after the paper reported his campaign call for a ban of Muslim immigrants, and has continued the attacks on and off since. After the Post published a story critical of the attorney general, Jeff Sessions, in July last year Trump claimed the Post was a lobbying arm for Amazon and that Amazon costs the postal service to deliver its packages. Trump was apparently gleaning that information from a Wall Street Journal article published days earlier titled Why the Post Office Gives Amazon Special Delivery that argued that Amazon was using its size to take advantage of the postal service. According to Craig Holman, a government affairs lobbyist with Public Citizen, a consumer advocacy group, there’s no question Trump attacks Amazon as a surrogate for Bezos and the Washington Post. “He’s hoping Bezos will apply some pressure on the Washington Post to back down on its criticisms,” said Holman. “I seriously doubt that’s going to happen. The Washington Post is a seriously independent newspaper, and Jeff Bezos is much wealthier as a result of Trump’s tax cuts. This won’t have much of an impact.” Last week, Business Insider published a study comparing Trump voters (63 million) with Amazon Prime members (in the region of 60 million, according to some estimates). In a showdown that might threaten US consumers’ access to free shipping, the outcome is a no-brainer. “If Trump were to take action that caused Amazon’s shipping costs to go up, the relevant stakeholders – including nearly 100 million American customers – would be broadly united on Amazon’s side of their business dispute with Trump,” predicted the publication. Still, says Holman, there is concern that Trump’s continued attacks on Amazon and the Washington Post will feed into existing distrust of the media and, increasingly, of tech giants through which the news media is distributed and who are now gearing up for regulatory battles. “He’s using every avenue he can think of to undermine the credibility of the independent press,” Holman says. “But I have the feeling Trump is out in the wilderness and he’s not going to succeed in his efforts to undercut the Washington Post or the mainstream media.” Americans, he says, “have become for good reason much more skeptical of his intentions”.



Why does Trump hate Jeff Bezos: is it about power or money?
The Guardian

URL: https://www.theguardian.com/technology/ ... ower-money
Category: Politics
Published: June 17, 2018

Description: The owner of Amazon and the Washington Post keeps his counsel, spurring the president to ever-greater rage
Nestled between the embassy of Myanmar and the historic home of Woodrow Wilson, the biggest house in Washington DC is taking shape. A yellow digger is parked outside, construction workers throw sandbags over their backs, and thick black tubes stretch from high windows to the ground like the legs of a giant octopus. Inside, a foreman in a baseball cap sits behind a desk at a laptop. “Going good,” he says. This will be the luxury home of Jeff Bezos, founder of Amazon, owner of the Washington Post and would-be first man on Mars. A sign on the corner of S Street in the swish Kalorama neighbourhood still points to the textile museum that occupied the 27,000 sq ft property before Bezos bought it for $23m. Along the row there are flags and signs supporting immigrants and gay rights; there are diplomatic outposts including the Irish ambassador’s residence. On one doorstep, the inevitable: a package from Amazon. Renovation of the Bezos mega-mansion is due for completion in September 2019, granting the multibillionare ready access to the Post’s state-of-the-art headquarters on K Street and, potentially, Amazon’s second HQ, for which Washington and surrounding areas are pushing hard. In a city where Donald Trump occupies the White House and owns a huge five-star hotel, it appears the stage is set for an epic battle: the world’s richest man versus its most powerful. For two and a half years Trump has launched Twitter attacks against Bezos, spuriously claiming Amazon benefits from billions of dollars in subsidies from the US Postal Service while dodging the taxman. Few doubt the president’s animus is truly motivated by Bezos’s ownership of the Post – a bastion of what he calls the “fake news” media – along with, perhaps, envy of his wealth. In March, Bezos topped the Forbes rich list for the first time with $112bn, making him the first person to break $100bn since Forbes began the ranking in 1987. Trump’s fortune dropped by about $400m to $3.1bn during his first year in office, leaving him as the world’s 766th-richest person – a fall of more than 200 places. “Bezos is as rich as he claims, Trump never was,” said Michael D’Antonio, a political commentator and author of The Truth About Trump. “He’s ranked many hundreds of places higher than Trump on the scale of wealth and he did it without any inheritance of the sort that Trump had. He’s respected in a way that Trump never was as a businessperson. He is circumspect in the way that Trump is not. He’s everything that Trump hates.” The men are a study in contrasting styles. One is defiantly bald, the other has a combover; one has a famously raucous laugh, the other seems allergic to laughing at all; one has an iron discipline in messaging and insists on six-page memos, the other is a verbal scattergun of provocations and self-contradictions and allegedly refuses to read briefing documents. Bezos founded Amazon as an online bookseller in 1994 and has expanded it to a retailer of breathtaking scale and range, including even groceries in brick-and-mortar stores after its $13.7bn purchase of Whole Foods Markets last year. It also runs data centres and makes TV shows and, some analysts say, is becoming dangerously big. Bezos, 54, has poured part of his wealth into Blue Origin, a maker of rockets that aims to lead space tourism. Its owner, whose father is a Cuban immigrant, has also donated to progressive causes such as same-sex marriage and to mostly Democratic candidates in elections. He bought the Post from the celebrated Graham family for $250m, five years ago. In a letter to its employees, he urged two kinds of courage: “The first is the courage to say wait, be sure, slow down, get another source. Real people and their reputations, livelihoods and families are at stake. The second is the courage to say follow the story, no matter the cost. While I hope no one ever threatens to put one of my body parts through a wringer, if they do, thanks to Mrs Graham’s example, I’ll be ready.” This was a reference to former publisher Katharine Graham who, during the paper’s digging into Watergate scandal in the 1970s, was threatened by Richard Nixon’s attorney general, John Mitchell: “Katie Graham’s gonna get her tit caught in a big fat wringer if that’s published.” In an interview with Post editor Marty Baron in May 2016, Bezos elaborated: “I have a lot of very sensitive and vulnerable body parts but if need be they can all go through the wringer rather than do the wrong thing.”
#SendDonaldtoSpace
Bezos’s investment has reinvigorated the Post, enabling it to hire dozens of new reporters and take on the New York Times in an old fashioned newspaper war. Both have enjoyed increased readership in the Trump era. Both have attracted opprobrium as nodes of the anti-Trump resistance. Trump has attempted to conflate Amazon and the Post at least a dozen times, claiming that the paper is a lobbying tool to help the Seattle-based behemoth evade sales taxes. Back in December 2015, he tweeted: “If @amazon ever had to pay fair taxes, its stock would crash and it would crumble like a paper bag. The @washingtonpost scam is saving it!” Bezos, probably as sceptical of Trump’s electoral chances as anyone else, responded wryly: “Finally trashed by @realDonaldTrump. Will still reserve him a seat on the Blue Origin rocket. #sendDonaldtospace” By October 2016, the Trump threat had become real. Bezos told a conference in San Francisco: “He’s not just going after the media, but threatening retribution to people who scrutinse him. He’s also saying he may not give a graceful concession speech if he loses the election. That erodes our democracy around the edges. He’s also saying he might lock up his opponent. These aren’t appropriate behaviours.” Since the Republican insurgent’s shock victory, Bezos has followed the example of special counsel Robert Mueller by maintaining a sphinx-like silence and refusing to be baited. Nothing, it seems, infuriates the president more. D’Antonio said: “Trump doesn’t know what to do with someone who won’t play and it would be a grave mistake for Bezos to engage. He doesn’t have to. “Bezos is just ontologically the opposite of Donald Trump and that gets under Trump’s skin. What he really hates is someone who appears to be incorruptible. He reads that as being superior, haughty, holier than thou. It’s what he hates about Mueller: that Mueller is an emblem of rectitude. There’s no evidence that Bezos is anything but a tough business person.” Trump has upped the bombardment. Last year he pondered: “Is Fake News Washington Post being used as a lobbyist weapon against Congress to keep Politicians from looking into Amazon no-tax monopoly?” He has not yet bequeathed on Bezos one of his infamous nicknames but has come up with the formula: “Amazon Washington Post.” What is driving this? Sam Nunberg, a former senior adviser to Trump’s election campaign, said this week: “Amazon, Google and Facebook are essentially monopolies in different sectors; even Rupert Murdoch is trying to fight Facebook. Suddenly it looks like the whole country is going to be Amazon Valley. The president does not like monopolies – he likes competition.” As for Bezos, Nunberg said: “I think the president sure doesn’t like him but Bezos doesn’t like the president either.” The notion that Amazon is ripping off the US Postal Service (USPS) has been widely debunked. The Politifact website rated Trump’s claim false, noting that the Amazon deal must be at least a break-even venture because a 2006 law makes it illegal for the USPS to price parcel delivery below its cost. “Amazon isn’t causing the United States Postal Service to lose a fortune,” the website concluded. “In fact, it’s contributing to its biggest growth sector, package delivery. Deals like the one with Amazon brought in $7bn in fiscal year 2017.” Last month the Post reported that Trump has personally pushed postmaster general Megan Brennan to double the rate the USPS charges Amazon and other firms to ship packages. On Wednesday two Democrats, Elijah Cummings, ranking member of the House committee on oversight and government reform, and Gerald Connolly, ranking member of the subcommittee on government operations, rebuked the president and pointed out that Amazon is not receiving any preferential treatment. “It is highly inappropriate to use the authority of your office to attack a political rival and seek to impair his business financially,” they wrote. “It is even more inappropriate to launch such attacks using false claims that are not supported by the facts. The allegations you have made about Amazon and the Postal Service are inaccurate, and we ask that you correct the record.” Bezos and the Post also deny that he ever attempts to meddle in the paper’s editorial coverage. Baron told the New York Times in April: “I can’t say more emphatically he’s never suggested a story to anybody here, he’s never critiqued a story, he’s never suppressed a story. Frankly, in a newsroom of 800 journalists, if that had occurred, I guarantee you, you would have heard about it.” D’Antonio, the Trump biographer, said: “As far as I know, Bezos is hands-off with the Washington Post and that is something that Trump can’t understand. The fact that this person would have a commitment to a free press and, as a publisher, honour the separation of editorial and business interests is anathema to Trump. His very being is a rebuke to Trump, so it all makes sense to me. “If Trump owned a newspaper, it would be called The Daily Trump and he would have a front-page column. I have no doubt of that.”
Overlapping interests
Experts who have met Bezos and chronicled his career say he is unlikely to be fazed by Trump’s jabs. Brad Stone, author of The Everything Store: Jeff Bezos and the Age of Amazon, said: “He is extremely compelling, charismatic, incredibly intelligent, an incredibly disciplined communicator on behalf of the interests of his company. He doesn’t let emotions govern his responses. Everything is well articulated and thought out. It’s been honed at Amazon for decades.” Amazon will be aware that Trump is not forever, Stone added. “They do think over the long term, five or 10 years, and they probably have business ambitions with the government. This is not going to last for more than three or seven years. They probably view it as a squall and they’ll stay huddled under their umbrellas until it passes.” And even now, Trump v Bezos can be seen as a skirmish rather than all out war. The latter was among tech chief executives who met the president-elect at Trump Tower in New York in December 2016; with other tech chiefs, Bezos has also been to the White House. Amazon has continued to work with the White House on initiatives around cyber-bullying, artificial intelligence and first lady Melania Trump’s “Be Best” campaign. There are overlapping interests in space exploration. Tim Fernholz, author of Rocket Billionaires: Elon Musk, Jeff Bezos, and the New Space Race, said: “What is interesting about this feud is that Trump’s policies towards towards commercial space companies like Blue Origin have been very positive. Things are very rosy between Blue Origin and Nasa. This is flying below the radar of everything that’s happening.” Bezos has been obsessed with space since childhood, when he reenacted Star Trek scenes with friends. “With Blue Origin, Jeff Bezos is very personally invested and he goes to rocket launches,” Fernholz added. “I think the Washington Post is philanthropy, an experiment in digital media – he says Don Graham talked him into buying it – whereas he was talking about rockets since he was a kid. I think he is proud of the Post and excited about space.” Trump’s obsessive tweets are not likely to keep Bezos up at night, considering all the other complaints in Amazon’s in-tray, according to Fernholz. “People are worried about the way they treat their workers, worried about the taxes they pay and worried about what market they’re going into next. Jeff Bezos is the world’s richest man and he’s thinking five or 10 years ahead, so he’s got bigger problems than Donald Trump to think about.”



Bezos blackmail claims add new twist to tale of Trump, Russia and the media
The Guardian

URL: https://www.theguardian.com/technology/ ... aims-trump
Category: Politics
Published: February 7, 2019

Description: Trump’s vitriol toward Amazon CEO and long ties to National Enquirer collided last month, when tabloid ran story on Bezos’s affair
The remarkable blogpost from Jeff Bezos – Amazon CEO, world’s richest man and owner of the Washington Post – accusing the National Enquirer’s parent company of blackmail adds another bizarre strand to the tangled web tying together Donald Trump, the media and the investigation into Russian interference in the 2016 election. Bezos has long been a hate figure for Trump due to his ownership of the Washington Post. Although Bezos does not take an active role in the paper’s management, Trump has repeatedly tweeted about the “Amazon Washington Post”.Trump has a long relationship with the National Enquirer and its CEO, David Pecker. The company long engaged in “catch and kill” agreements on behalf of Trump, paying for negative stories in order not to run them. It admitted to criminal behavior in a plea deal with federal prosecutors where the company and its executives received immunity in exchange for giving evidence against Trump’s fixer Michael Cohen. These issues collided last month when the National Enquirer ran a story about Bezos’s extramarital affair that relied on intimate text messages between Bezos and Lauren Sanchez, a former TV anchor. At the time of the story, Trump tweeted: “So sorry to hear the news about Jeff Bozo being taken down by a competitor whose reporting, I understand, is far more accurate than the reporting in his lobbyist newspaper, the Amazon Washington Post. Hopefully the paper will soon be placed in better & more responsible hands!” In his blogpost on Thursday, Bezos suggests the Washington Post’s reporting on the murder of its columnist Jamal Khashoggi may have made him a target of Pecker, pointing out that the National Enquirer’s owner, American Media Inc (AMI), produced a glossy pro-Saudi tabloid. “It’s unavoidable that certain powerful people who experience Washington Post news coverage will wrongly conclude I am their enemy,” writes Bezos. “President Trump is one of those people, obvious by his many tweets. Also, The Post’s essential and unrelenting coverage of the murder of its columnist Jamal Khashoggi is undoubtedly unpopular in certain circles.” There is no way to predict what consequences may stem from the tabloid’s threat to publish a picture of Bezos’s genitalia. But the National Enquirer may be at additional legal risk. In its plea deal with federal prosecutors, AMI pledged not to “commit any crimes subsequent to the date of the signing of this agreement”. The penalty for violation would be to void the immunity agreement and open the company up for prosecution.



Trump, 'blackmail' and a Pecker: Bezos delivers scandal with something for everyone
The Guardian

URL: https://www.theguardian.com/technology/ ... vid-pecker
Category: Politics
Published: February 9, 2019

Description: This convoluted tale – with lurid pics, private investigators and, naturally, Trump – seems to have captured the spirit of the age
Another Hollywood awards ceremony passed with the usual red carpet fashion show, earnest acceptance speeches and mingling of the rich and famous. So few found it remarkable when billionaire Jeff Bezos, chief executive of Amazon, was photographed at an after-party with TV presenter and helicopter pilot Lauren Sanchez. But just a few days after the Golden Globes, it would become clear this picture was a crucial clue to the unravelling of Bezos’s 25-year marriage – and a tangled web of intrigue now spanning the worlds of Washington politics, New York tabloids and Los Angeles showbusiness. Add into the mix this week some lurid photographs, allegations of blackmail and a put-it-all-out-there blogpost by Bezos, and the man who gave the world “The Everything Store” had delivered “The Everything Scandal” – possibly all the way to the doorstep of the American president and his allies in Saudi Arabia. In an era when every controversy seems to have a connection to Donald Trump, there was of course a connection to him. Speculation was rife that the world’s most powerful man had weaponized a supermarket tabloid to go after the world’s richest. Trump, 72, and 55-year-old Bezos do, after all, have a keen rivalry, at least in the president’s mind. Bezos, who founded Amazon as an online bookseller in 1994 and bought the Washington Post in 2013, is now worth $136bn, a fortune that dwarfs Trump’s. For three years Trump has attacked him on Twitter, spuriously accusing Amazon of dodging taxes at the expense of the post office and the Post of trafficking in “fake news”. But Bezos has kept his cool and refused to take the bait, probably riling the president even more. Bezos’s personal life came under unwelcome scrutiny a month ago in almost Trumpian style, however. On 9 January, three days after the Golden Globes, he used Twitter to announce his divorce from novelist MacKenzie Bezos. The following day, the National Enquirer tabloid revealed Bezos’s extramarital affair with Sanchez, 49, a former host of So You Think You Can Dance? now in the process of divorcing her husband. In coverage sprawling across 11 pages, the Enquirer said its reporters followed Bezos and Sanchez “across five states and 40,000 miles” and “tailed them in private jets, swanky limos, helicopter rides, romantic hikes, five-star hotel hideaways, intimate dinner dates and ‘quality time’ in hidden love nests”. The tabloid reported that Bezos sent “sleazy text messages and gushing love notes” to Sanchez. It is safe to assume that no previous US president would have passed comment. But Trump could not conceal his sense of schadenfreude. “So sorry to hear the news about Jeff Bozo being taken down by a competitor whose reporting, I understand, is far more accurate than the reporting in his lobbyist newspaper, the Amazon Washington Post,” he gloated on Twitter. “Hopefully the paper will soon be placed in better & more responsible hands!” That was not the end, however. With almost unlimited resources at his disposal, Bezos hired a crack team of private investigators to find out how the Enquirer had got its hands on his text messages and photos. David Pecker, owner of the Enquirer and longtime friend of Trump, was “apoplectic” when he learned the tables had been turned, according to Bezos’s blogpost, and threatened to publish more material unless Bezos called his investigators off. Enquirer editor Dylan Howard allegedly sent an email warning of nine intimate images in excruciating detail. They included a “below the belt selfie — otherwise colloquially known as a dick pick”. By Bezos’s account, Pecker’s team made an offer: the Enquirer would agree to not publish the photos if Bezos and his investigators released a public statement “affirming that they have no knowledge or basis” to suggest the tabloid’s coverage was “politically motivated or influenced by political forces”.Bezos refused and punched the bully instead. “Of course I don’t want personal photos published, but I also won’t participate in their well-known practice of blackmail, political favors, political attacks, and corruption,” he writes. “I prefer to stand up, roll this log over, and see what crawls out.” His blogpost, published on the neutral Medium website under the title “No thank you, Mr Pecker”, flipped the script and earned widespread approbation. Journalist Carl Bernstein, who reported on the Watergate saga, told CNN that Bezos “in this instance has acted heroically, in terms of establishing that neither he nor the Post will be intimidated”. Nicholas Thompson, editor of Wired, tweeted: “Amazing that the National Enquirer has been so repulsive that the whole internet is rooting for a billionaire who got busted for an affair.” Others were awed by the epic, multi-layered nature of the scandal and how it captures the spirit of the times. Robinson Meyer wrote in the Atlantic magazine: “In a little more than 2,000 words, Bezos seemed to rip every headline out of the newspaper and bind them in an eternal neon braid: the mighty power of billionaires, the immiseration of American journalism, the thin smudge of porniness that smartphones have layered onto reality — all of that, and President Donald Trump (who is a close friend of David Pecker, AMI’s chief executive), and the corruption and journalist-murdering malice of the Saudi government, which Bezos alleges is wrapped up in his story ‘for reasons still to be better understood.’” The trail of crumbs to Trump and Saudi Arabia is circumstantial and tantalising. The Enquirer has long engaged in “catch-and-kill” agreements on behalf of the New York property tycoon, paying for negative stories to ensure they never see the light of day. These included Trump’s alleged affairs with adult film actor Stormy Daniels and former Playboy model Karen MacDougal. Parent company American Media Inc (AMI), admitted criminal conduct last year in a plea deal with federal prosecutors, receiving immunity in exchange for giving evidence against Trump’s legal fixer Michael Cohen. Prosecutors are now reportedly looking at whether the Enquirer’s feud with Bezos violated the cooperation and non-prosecution agreement. Meanwhile, Bezos suggested in his blogpost that the Washington Post’s reporting on the murder of its columnist Jamal Khashoggi, a critic of the Saudi government, may have made him a target of Pecker. AMI produced a glossy pro-Saudi tabloid, he points out. He also noted that Pecker and AMI have been “investigated for various actions they’ve taken on behalf of the Saudi government” and adds cryptically that “for reasons still to be better understood, the Saudi angle seems to hit a particularly sensitive nerve”. Trump has also been criticized for his cosy relationship with the Saudi government and failure to demand answers about Khashoggi’s death. On Friday AMI said its board of directors ordered a prompt and thorough investigation and will take “whatever appropriate action is necessary.” Adel al-Jubeir , the Saudi foreign minister, told CBS’s Face the Nation programme: “This sounds to me like a soap opera. I’ve been watching it on television and reading about it in the paper. This is something between the two parties. We have nothing to do with it.” But as of Friday night, there had been an uncharacteristic response from the White House: silence.
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White House aides repeatedly used PowerPoint to teach Trump how Amazon works — but he just ignores them

Postby smix » Fri Apr 06, 2018 6:12 pm

White House aides repeatedly used PowerPoint to teach Trump how Amazon works — but he just ignores them
Raw Story

URL: https://www.rawstory.com/2018/04/white- ... t-ignores/
Category: Politics
Published: April 6, 2018

Description: President Donald Trump was given PowerPoint presentations intended to debunk his inaccurate beliefs that Amazon was dodging taxes and abusing the U.S. Postal Service — he just chose to ignore them. Early in his administration, White House officials arranged private Oval Office briefings so he could speak more knowledgeably about Amazon after hearing him make false claims about the online retailer, reported the Wall Street Journal. Gary Cohn, then his chief economic adviser, and other officials tried to bring Trump up to speed on the topic, but to their dismay, he continued making the same inaccurate complaints about Amazon’s tax and shipping payments. “It’s not the narrative he wants,” said one person familiar with the matter. “He clearly didn’t find it persuasive because he keeps saying it’s untrue.” Sources close to the White House told the Journal that Trump was personally angry with Amazon CEO Jeff Bezos because he also owns the Washington Post — whose coverage the president sees as unfairly critical of him and his administration. Those sources say Trump is attacking Amazon as a proxy for the Washington Post and Bezos. Publisher Frederick J. Ryan Jr. said Thursday that Bezos has “never proposed a story” and plays no role in the newspaper’s coverage. “Jeff has never intervened in a story,” Ryan said. “He’s never critiqued a story. He’s not directed or proposed editorials or endorsements.” Trump has renewed his attacks on Amazon this week, and his aides again have tried to gently point out his complaints might be “missing the point,” according to a White House official. However, that has prompted Trump to continue “digging in,” the official said. One person who speaks regularly to the president said his complaints about Amazon were directly related to Post coverage. “(Trump) talked about the fact that the Washington Post is solely owned by Jeff Bezos and (Bezos) is using that same entity to take on the president and the administration,” the source said. Another person close to the White House confirmed that source’s claim. “Every time there was a bad story (Amazon) would come up,” that person said.
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