Friday, June 16, 2017

Washington Post -- Amazon to buy Whole Foods Market in deal valued at $13.7 billion

“ sent a shock wave through the grocery industry Friday when it announced plans to buy Whole Foods Market and formally enter the world of bricks-and-mortar retail.

According to Robert Reich, Amazon is on the verge of owning American retailing.

Conglomerates and monopolies are not good for the United States and its democracy. Amazon’s deal to buy Whole Foods will not benefit the American consumer.

Conglomerates and monopolies control markets. They have unobstructed power to raise prices, limit choices, lower wages, and suppress competition.

By concentrating more wealth in the hands of a few, conglomerates and monopolies drive inequality. Its results are egregiously high prices set by drug companies, enables the abuses by cable providers, health insurers, and airlines, for example, with limited recourse by consumers. And they use their power to influence government policy.

“Donald Trump rumbled about monopolists a few times during his campaign. And, true, he may yet deliver on his promises to block AT&T’s takeover of Time Warner and to bring an antitrust case against Amazon. But given Trump’s embrace of such Wall Street monopoly-makers as Wilbur Ross and Paul Singer, it’s much easier to imagine that under his administration, concentration in America will get only worse.

“The last time the country faced such threats, after the rise of the plutocrats in the early decades of the 20th century, it was the Democrats who spoke directly to the fears of the citizenry. Consider Franklin Roosevelt’s words in 1938. ‘The liberty of a democracy is not safe,’ he said, ‘if the people tolerate the growth of private power to a point where it becomes stronger than their democratic state itself. That, in its essence, is Fascism—ownership of Government by an individual, by a group, or by any other controlling private power. … Among us today a concentration of private power without equal in history is growing.’

“The age of true American liberty—in which it is the people who rule both the government and the economy—lies in the muck,” -- The Atlantic.

“The $13.7 billion deal brings to a head a years-long battle brewing between Amazon, the online darling, and traditional retail powerhouses likes Walmart. And it shakes up a U.S. grocery industry that has been struggling to keep up with growing competition, both in stores and online. Amazon, which for years has been testing new technology and innovations in quiet corners, would now have a network of physical locations to test and implement those ideas.

“News of the deal sent shares of traditional retailers like Walmart, Target, Costco and Kroger tumbling as much as 13 percent as investors tried to digest the implications of an Amazon-backed grocery chain,” the Washington Post reports.

“This means Amazon is now going to compete head on with Walmart, as well as Target, Costco, and Kroger Within 10 years, they'll all be gone. Amazon is on the verge of owning American retailing.

“Heads up: At the rate they’re going, within 20 years Amazon, Google, and Apple (possibly along with Microsoft and Facebook) will dominate the American economy. Watch as they begin to take over finance and the media.

“Will this be good for consumers? No. With that kind of economic power, they'll be able to raise prices. Good for American democracy? No. With that kind of power, they'll basically run the government -- as did railroads and oil in the Gilded Age. What's the answer? Revive antitrust,” according to Robert Reich

Amazon to buy Whole Foods Market in deal valued at $13.7 billion 

By Abha Bhattarai