Shoppers love Amazon. And why wouldn’t we: fast, often free, home delivery of a wide variety of goods, at great prices and easy returns when needed. But shoppers should beware, Amazon’s critics warn. They claim the online retailer is exploiting its customers by getting them to buy things they don’t need. The critics argue that Amazon uses its Prime membership program to get customers to favor Amazon over its competitors. Amazon has a dark motive for all this, they claim: it’s “trying to control the economy” (whatever that means). See Kevin Libin’s great Financial Post editorial about this here.

The latest attack on Amazon was triggered by its recent effort to get into the grocery delivery business by  taking over Whole Foods. This led to an outcry that Amazon will “control” the grocery market. With Whole Foods’ 2.5% of the U.S. grocery market, an Amazon domination will not happen any time soon, nor will its success be guaranteed. But if anyone can make online grocery shopping successful, it will be Amazon.

So who are Amazon’s critics? An assortment of social justice warriors, from activists and ‘business’ journalists crusading for “equality” to politicians claiming to be concerned about Americans’ wellbeing and “a level playing feel”—in other words, equality among businesses. They all want to ensure that companies like Amazon don’t become too successful—and too big, because that would take opportunities and profits away from smaller competitors and grant giants like Amazon a near-monopoly—they claim.

And that, we are made to believe, would surely lead to all kinds of abuses: jacking up prices, lowering of wages, bargaining down prices with suppliers.

When Amazon’s critics cry out for equality and a level playing field, they do not mean political equality: the same individual rights for everyone, which they should wholeheartedly embrace, if they really cared about human wellbeing. The critics want equality of income and wealth and profits—which hugely successful and profitable companies threaten.

But should we want equality of wealth and income, when that means “cutting Amazon down to size” that its critics are calling for?

Do we really care is Amazon is huge, and hugely profitable? No—because we all benefit from its success.

What would happen, if government would listen to such calls and tell Amazon which markets it can get into and which ones not, or force it to sell parts of its business to competitors, at a price that government determines would ensure a level  playing field?

Such use of force by government, which Amazon’s critics are salivating for, would make it impossible for the company to deliver goods at its current low prices and fast pace. Or it would not be able to offer the variety and volume we are now accustomed to. Amazon would not be able to hire as many people, nor could it provide the kinds of returns to its shareholders. Most importantly, why would Jeff Bezos want to continue to run his company under conditions where government’s arbitrary force would dictate what he can and cannot do?

We would all be harmed by such enforcement of “equality,” by less affordable products, less convenience, and less service. Many customers, particularly those in remote areas (like the Canadian Artic where Amazon’s deliveries of supermarket goods make a big difference), would see a real dent in their standard of living.

Do we really care is Amazon is huge, and hugely profitable? No—because we all benefit from its success.

But the critics of Amazon don’t care about our wellbeing. What really drives them is a hatred of success: success of anyone who is achieving more than others. Such hatred is fed by the mistaken, but very common, moral idea that we are all our brothers’ keepers. According to this moral idea, known as altruism, we should always put others’ needs ahead of our own. And if we don’t do it voluntarily, the government must force us—as the critics of Amazon are arguing.

Shoppers haven’t paid much attention to the attacks on Amazon, as they happily continue shopping and benefiting from the affordability and convenience Amazon provides. But if the company’s critics are successful and the government threatens to take action to “cut it down to size,” Amazon’s customers must speak up, loudly, in its defense—if they care about their own lives and wellbeing.

 

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Jaana Woiceshyn teaches business ethics and competitive strategy at the Haskayne School of Business, University of Calgary, Canada.She has lectured and conducted seminars on business ethics to undergraduate, MBA and Executive MBA students, and to various corporate audiences for over 20 years both in Canada and abroad.Before earning her Ph.D. from the Wharton School of Business, University of Pennsylvania, she helped turn around a small business in Finland and worked for a consulting firm in Canada.Jaana’s research on technological change and innovation, value creation by business, executive decision-making, and business ethics has been published in various academic and professional journals and books. “How to Be Profitable and Moral” is her first solo-authored book.

1 COMMENT

  1. I doubt the hatred of the successful comes from self-sacrifice (‘atruism’) but rather from envy and the equality belief you point to.

    As for Amazon’s future, it will fade as many companies have unless it is willing to communicate properly with customers when there is a problem. Founder Jeff Bezos faces the challenge of teaching his values thoroughly so the people he delegates to when he’ focusing on his other interests like rockets will keep the company on track. Few businesses achieve that, a free market supported by a justice system fosters new competition that wins customers business.

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