Stopping Bezos

Activists protest Jeff Bezos visit to Axel Springer. Berlin, 24 April 2018.

After months of controversy and protest, Amazon has declared it will give some of its workers a raise. This should be the start, not the end of change.

Amazon is set to give its US employees a $15 minimum wage, and its UK workers a £10.50 minimum wage in London and £9.50 outside the capital. That’s roughly $12.30 to $13.60 an hour, which is a good deal for those working regular hours.

Who could argue it’s a bad thing for the people stalking the aisles of Amazon’s warehouses? These workers are the reason your packages arrive at all, let alone on time. Warehouse labour is not a walk in the park. It’s long hours with few breaks and often gruelling work.

So the press responded with praise when the news of the raise came.

Another development was less well publicised. The company is withdrawing its bonus scheme and replacing it with the offer of cheap shares for employees.

Under the existing system, Amazon grants its warehouse workers one share for every year they work for Amazon, which is worth $1,961 at the time of writing. This share can be cashed in at the end of the year, tax-free.

The GMB claims that the loss of the pay-out could half the raise in pay that Amazon has just announced. The union called it “a stealth tax on its own wage increase”. The company argues that the workers prefer cash remuneration to an end of year pay-out.

No one should be surprised by any of this, least of all the people who have been campaigning for better working conditions in those warehouses. Profits have to be made somehow, and labour is a cost at the end of the day. So it goes, the nature of capitalism.

Battle in Seattle

Frequently described as a ‘tech giant’, Amazon is the behemoth of high-tech industry with a market cap of more than $1 trillion. The company’s CEO Jeff Bezos is now the world’s richest man, sitting on more than $150 billion. And yet it hasn’t been a perfect year for the behemoth of Seattle.

Not only has Amazon faced scathing criticism for the working conditions of warehouse employees, the company wandered into a public spat in its hometown over a tax to fund housing for the homeless (more on that later).

Seattle City Council voted for a new tax on big employers to try and rehouse the city’s homeless. The plan was to levy a tax of $275 per employee on any business making more than $20 million a year. It would have raised $47 million a year to fund an affordable housing programme.

The council unanimously approved the plan on 14 May, only to abandon it on 12 June. The ‘No Tax on Jobs’ group, a coalition of business groups including Amazon and Starbucks, moved quickly to heap pressure on the council.

Amazon felt its bottom line was under threat and halted its construction of Block 18, a 17-story office complex. The company threatened to leave Seattle altogether and take its operations elsewhere. This was no small matter given that the business employs 40,000 people in Seattle.

“The opposition has unlimited resources,” Lisa Herbold, councilwoman for West Seattle, told the press at the time. Herbold was reluctant to back the repeal of the tax, but she did so because she didn’t think the council could win a fight with a company like Amazon.

Just two members of the council refused to support the repeal of the tax plan. This included the socialist Kshama Sawant, who denounced her colleagues for capitulating to big business. Incidentally, Sawant is one of the most prominent campaigners for a $15 minimum wage.

The plan to impose a so-called ‘head tax’ was undoubtedly flawed from the start. However, the power of business, in this case, should worry any observer. Nevertheless, the idea of using tax policy as a way of pressuring business was out.

Can’t Pay, Won’t Pay

Amazon may have won the battle in Seattle, but the company ultimately decided it was best to make concessions before it was too late. The warehouse workers got a raise (at least to some extent), and the business got some positive headlines for the first time in a while.

After all, the behemoth understands that there is only so far you can push things. The fact that Bernie Sanders came up with the aptly named ‘STOP BEZOS’ Act to raise a national tax on companies like Amazon only helped tip the balance.

Trade unions and campaigners have been working tirelessly to bring the plight of warehouse workers into the mainstream media. What every capitalist fears is that the exposure will lead to more than bad press. This is precisely why we shouldn’t stop at a $15 minimum wage.

Today’s concessions are tomorrow’s losses. The time is nigh to eat the rich. Even though it means putting aside the crushed avocado on toast, we have little choice. So let’s start with Bezos.

Photograph courtesy of Joel Schalit. All rights reserved.