Missouri lawmakers have been doing their darnedest to see the glass half-full after Amazon rejected the state’s $2.4 billion subsidy package for its second headquarters earlier this year. But recent news of Amazon’s historic quarterly profits should have them outraged.
The ugly truth is that the third-richest company in the world, while raking in $2 billion in profits, was asking Missouri taxpayers to bankroll a new headquarters. Even worse, Amazon has been getting away with these strong-arm tactics for years.
It is time for Missouri lawmakers to stand up to Amazon and say no to any more corporate welfare.
Since 2000, Amazon has received a staggering $110 million in subsidies from Missouri taxpayers, making the state one of the five biggest Amazon subsidizers. In fact, just this year Amazon struck a deal with Missouri on a new fulfillment center in St. Charles County that will likely save the tech giant over $7.9 million in taxes — money that could be used to invest in better education, infrastructure renewal or expanded health care services.
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What’s become absolutely clear is that this entitled attitude is central to Amazon’s business model. From 2000 to 2017, Amazon spent at least $9.8 million on state lobbying and contributed another $6 million to political campaigns. According to Amazon’s own reports, it also spent almost $14 million on state and local “government relations efforts” between 2013 and 2017 alone. As Amazon grows, it continues to spread its influence-peddling. Over the last five years, Amazon has lobbied more government entities than any other tech company.
Meanwhile, the subsidies have been pouring in. Amazon has received $1.5 billion in taxpayer-funded subsidies nationwide since 2000.
The toll on Missouri communities and small businesses across the country has been disastrous, as taxpayers have forfeited more than $700 million in sales tax revenue. Amazon’s corporate entitlement and its refusal to pay its fair share has destroyed well-paying jobs and small businesses, which struggle to compete with the tax-dodging tech giant.
In return for the helping hand of corporate welfare, Amazon promises new jobs and economic development at its warehouses and fulfillment centers. But the numbers show that private-sector employment fails to increase after Amazon moves into town, and the jobs they promise in their warehouses don’t pay enough to support a family.
Just listen to Russell Grandinetti, the company’s senior vice president of international consumer, who recently said Amazon’s impact on local communities is not for Amazon to worry about.
Apparently it’s not Amazon’s job to worry about small businesses selling on its e-commerce platform either. Third-party retailers have complained for years about the site’s fee hikes, fake reviews and fraudulent products. They have also decried Amazon’s practice of using consumer and sales trend data to manipulate and drive down prices, which adds salt to small businesses’ wounds.
Missouri lawmakers should take Amazon’s corporate bosses at their word when they say the company does not worry about fears that their growth destroys local businesses and decimates jobs. Taxpayers are tired of underwriting Amazon’s growth and record profits by giving up their hard-earned tax dollars through subsidies and corporate welfare.
Missouri’s loss in the Amazon HQ2 sweepstakes was a big win for all the hard working residents, businesses and communities in the state. It is now time for Missouri politicians to say no more, stand up to Amazon’s legions of lobbyists and return to prioritizing our local communities.
Robert B. Engel, retired CEO of CoBank, is the chief spokesperson of the Free & Fair Markets Initiative, a 501(c)(4) nonprofit focused on supporting a modern, fair marketplace that serves the best interests of small businesses and local communities.