There’s a little Internet company known as Amazon (market cap: $919 billion).
Owned by a slightly rich guy named Jeff Bezos (net worth: $150 billion).
This plucky little Bezos with his plucky little Amazon company – is REALLY good at securing government cronyism…from any and every level of government.
While we ordinarily loathe cronyism – we do like to foster the growth and development of plucky little companies like Amazon. So if Bezos can secure for his Amazon advantageous government thumbs on economic scales – who are we to complain?
We kid. We’re kidders. Bezos is the richest man in the history of the planet. His Amazon is almost certain to be the second $1 trillion company (after Apple).
Yet governments everywhere are throwing tens of billions of our dollars at Bezos’ Amazon.
If anything, government should be protecting us from Amazon – and its extraordinarily awful anti-competitive practices. Where Amazon oft abuses its massive market share – to crush all of the much smaller companies attempting to run with the Big Dog.
We’ve explored how state and local governments nationwide are competing with each other by using more and more of our money – to out-bribe each other to get Amazon to locate its new headquarters in their locales:
“Here’s the question no bureaucrats seem to ask before each begin throwing hundreds of millions of your dollars at Bezos.
“The answer is: No – they aren’t good for the local economy….Bribing businesses to be there – makes no more sense than bribing football stadiums to be there.”
And once Amazon gets somewhere – the anti-taxpayer cronyism continues.
“Virginia’s largest utility, Dominion Energy Inc., had planned to run an above-ground power line straight through a Civil War battlefield (and private property)…to reach a nearby data center run by an Amazon.com Inc. subsidiary.
“After three years of petitions and protests…, Dominion agreed to bury that part of the line along a nearby highway, at an estimated cost of $172 million.
“Within a month, however, the utility and state legislators had passed on the cost to Thomas and her fellow Virginians. The state’s House of Delegates approved Dominion’s proposal to raise the money needed for the Amazon line with an as-yet-unannounced monthly fee.”
And that’s just state and local governments. Is titanic Washington, D.C. engaging in Washington, D.C.-sized Amazon cronyism? You bet your Bezos.
Bezos knows he has to pay a relative little – to play a whole lot:
“‘Amazon spent a record $3.2 million in the second quarter of the year, according to its lobbying disclosure. It’s part of Amazon’s fast-paced growth spurt in Washington, D.C., where it even hired a top fundraiser for Trump from the 2016 presidential campaign as one of its lobbyists….’
“‘Federal filings show that the tech giant spent nearly $13 million in lobbying costs last year, up from $11 million the year before.’
Amazon’s pay-to-play – is paying massive dividends.
“The government wants it. Progressives want it. High bandwidth-consuming companies want it….”
Net Neutrality is the government – outlawing high bandwidth-consuming companies being charged for being high bandwidth-consuming companies. Amazon of course being a high bandwidth-consuming company – wants Net Neutrality. Amazon celebrated Barack Obama imposing it – and glumly protested Donald Trump un-imposing it.
Why? Because plucky little Amazon (again, market cap: $919 billion) really needs yet another raft of taxpayer-funded cronyism. That’s why.
Screw delivery competitors UPS (market cap: $106 billion) and FedEx (market cap: $66 billion). Two companies whose combined total worth – is just larger than Bezos’ individual worth. Two companies – Amazon could simultaneously purchase with coin from its petty cash drawer.
And then there is perhaps the piece de resistance of Amazon cronyism – government cloud computing contracts.
“A $600 million computing cloud built by an outside company is a ‘radical departure’ for the risk-averse intelligence community.”
$600 million is not unserious money. But that’s cloud chump change – compared to….:
“According to an internal strategy document…the Pentagon aims to award a 10-year cloud computing contract – potentially worth billions – to a single company by the fourth quarter of 2018.”
A single-company – is a very bad idea from a basic backup and security perspective. It’s also an awful idea – from a cronyism perspective.
“…makes it much more likely you’ll get government contracts….
“Meet Deap Ubhi….Ubhi’s LinkedIn headline says he works for USDS (a Defense Department sub-agency) – but his employment history says he works as ‘Product Director’ for Defense’s DDS. Sounds like procurement to me.
“And where did Ubhi work immediately prior to government? Why look…uber-Big Tech company Amazon….And Ubhi didn’t just work for Amazon. He worked for Amazon Web Services (AWS) – Amazon’s cloud storage company.”
Well isn’t that special. And that special-ness – begets this special-ness: Why have just one way-insider – when you can have two?
“(O)n July 26, the Defense Department issued a request for proposals called JEDI, short for Joint Enterprise Defense Infrastructure. Whoever winds up landing the winner-take-all contract will be awarded $10 billion – instantly becoming one of America’s biggest federal contractors.
“But when JEDI was issued, on the day Congress recessed for the summer, the deal appeared to be rigged in favor of a single provider: Amazon.
“According to insiders familiar with the 1,375-page request for proposal, the language contains a host of technical stipulations that only Amazon can meet, making it hard for other leading cloud-services providers to win—or even apply for—the contract.
“One provision, for instance, stipulates that bidders must already generate more than $2 billion a year in commercial cloud revenues—a ‘bigger is better’ requirement that rules out all but a few of Amazon’s rivals.
“What’s more, the process of crafting JEDI bears all the hallmarks of the swamp that Trump has vowed to drain. Though there has long been talk about the Defense Department joining the cloud, the current call for bids was put together only after Defense Secretary James Mattis hired a D.C. lobbyist who had previously consulted for Amazon.
“The lobbyist, Sally Donnelly, served as a top advisor to Mattis while the details of JEDI were being hammered out. During her tenure, Mattis flew to Seattle to tour Amazon’s headquarters and meet with Jeff Bezos. Then, as the cloud-computing contract was being finalized, Donnelly’s former lobbying firm, SBD Advisors, was bought by an investment fund with ties to Amazon’s cloud-computing unit.
“Congressional insiders who have reviewed the process question whether Donnelly violated a federal law that bars executive-branch employees from participating in government decisions that affect their personal interests.
“‘We recently became aware of serious and possible criminal violations related to the Amazon cloud DOD contract process,’ says a high-ranking congressional staffer who spoke on the condition of anonymity. ‘We are concerned about the implications of the appearance of conflicts of interest and impropriety related to how Pentagon personnel with close ties to Amazon may have influenced multi-billion-dollar cloud contracts.’…
“Amazon’s high-ranking connections in the Pentagon underscore how Jeff Bezos continues to wield influence in Washington, even as the president himself rails against the online goliath. It also raises a larger question: How do you drain a swamp when the alligators are bigger than ever?
“‘When you have that kind of access during a $10 billion procurement, that compromises the integrity of the procurement,’ says John Weiler, an industry expert who runs a trade group that includes many leading IT firms. ‘Amazon was basically able to write the playbook.’”
This massive Defense Department cloud contract – is on the verge of being the biggest, ugliest act of cronyism…in the history of Cronyism Central: Washington, D.C.
And that’s saying something. Really awful.
This Amazon uber-insider-ism – is exactly the sort of Swamp-ishness against which Trump ran for President. His pledge to Drain – assuredly helped win him the office.
Please, Mister President:
Please do not let Bezos’ Amazon’s latest, awful-est, $10 billion monopoly cronyism come to pass.