What’s Going On: Shed no tears for Jeff Bezos
Every two weeks, when I look at my paycheck, I see about 9 percent of it disappearing to state and federal income taxes.
Once a year, thanks primarily to three little hobgoblins running around the house, I get a decent portion of that back from Uncle Sam but not all of it, which I’m sure is the case for most of us. And that’s fine. I don’t mind paying my share of taxes, as I like having things like roads (and plows to clear them) and schools and libraries and parks. Those things are nice.
Unfortunately, not all of us pay that portion of our income for those amenities.
Not Jeff Bezos, that’s for sure. If you don’t know who Jeff Bezos, here’s all you need to know: he owns Amazon and he’s the richest guy on the planet worth an estimated $135 billion.
Proving the old adage bad things happen in threes, Bezos has had a rough week. First, there was the revelation that The National Enquirer, over the course of several years, had obtained numerous intimate texts and photos the Amazon founder had sent to his longtime girlfriend. These were very explicit texts and … shall we say lurid photos sent while Bezos was still married.
But that didn’t really register with me. Another rich guy acting like a heel? Bleh. That’s old (but not fake) news. Heard it 1,000 times, especially the last couple years.
It was the second story that got me rankled.
Thursday, numerous media outlets reported a seemingly unbelievable story about the company worth nearly $800 billion.
In 2017, Amazon generated more than $5 billion in profits, an astronomical figure. Yet, they didn’t pay a dime in taxes. In fact, they received a $140 million refund.
But if you think that must be a one-time anomaly, to quote the French, au contraire, mon frere. In 2018, those profits doubled to more than $11 billion. And yet, no taxes paid and $129 million refunded due to tax credits and stock-based compensation deductions.
Let’s put this in proper context regarding the average American and their weekly or bi-weekly paycheck. What Bezos and Amazon have managed is the equivalent of a $50,000-a-year worker not only never having income tax taken from their check throughout the year, but still receiving a $2,000 refund after filing their tax return.
That doesn’t happen anywhere … except in the corporate world.
Story number three broke literally hours after the tax revelation.
Coincidentally, or not, the Seattle-based company announced Thursday night they were cancelling plans to open a second headquarters in New York City.
This from the New York Times: “Amazon on Thursday canceled its plans to build an expansive corporate campus in New York City after facing an unexpectedly fierce backlash from lawmakers, progressive activists and union leaders, who contended that a tech giant did not deserve nearly $3 billion in government incentives. The decision was an abrupt turnabout by Amazon after a much-publicized search for a second headquarters, which had ended with its announcement in November that it would open two new sites — one in Queens, with more than 25,000 jobs, and another in Virginia.”
Amazon and Bezos have suffered failures before. Remember that flop of a phone they came out with a few years ago that was basically a cheap knockoff of the iPhone? But this is different. Getting run out of a city where you were going to bring thousands of jobs is … unique … to say the least and a public relations’ black eye.
Time will tell if it’s going to impact their growing popularity with consumers, but it certainly should.
Beyond the fact Amazon does nothing to support our communities in terms of employment, taxes or simple donations to local organizations and charities, they are killing our retail base. There is no mystery as to why ShopKo, and Herberger’s, and Sears, and K-Mart, and JcPenney are closing en masse.
The question is are we as consumers willing to change our habits. Shopping online is so easy. It’s so convenient.
But it’s killing us. It’s truly the death by a thousand paper cuts.
And to add injury to insult, not only is Amazon not adding one penny to the tax base, it’s actually taking money out of it which is the true definition of corporate welfare.
You will hear a lot of commentary about this phenomenon in the coming days and I’m certain it will be a talking point in the upcoming election cycle. But we are kidding ourselves if we expect politicians from either party to fix this.
If we want to change this dynamic, we have to change ourselves. Until that happens, Bezos will keep cashing those checks.
Gregory Orear is the publisher of The Journal. His award-winning weekly column, “What’s Going On,” has been published in four newspapers in three states for more than 20 years. He can be contacted at email@example.com.