Donald Trump

How Trump and Bezos Can Bury the Hatchet

If Donald Trump is the dealmaker he touts himself as, he'll make public peace with Amazon CEO Jeff Bezos. Here's why.

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protohiro/Flickr

The hottest political fight in America right now may not be between Donald Trump and Hillary Clinton, but between Trump and Jeffrey Bezos, who is the founder and CEO of Amazon.com and the owner of The Washington Post.

Look for it to end up like Trump's last big public feud with a high-profile media figure: in a conciliatory meeting like the one that Mr. Trump had with the Fox News anchor Megyn Kelly. The underappreciated fact is that on one of Trump's key issues—trade with China—Trump and Bezos have a mutual interest that overlaps more than either of them probably realize.

I realized this, strangely enough, not as a political reporter or analyst but as an Amazon customer. Two recent items I ordered from the online retailer showed up at my house not in the familiar Amazon logo packaging, but in envelopes mailed directly via China Post, one from Shenzhen, the other from Zhejiang, in China.

Welcome to the cutting edge of retail supply chain. Americans used to worry about job loss because our manufacturing jobs had turned into lower-wage positions as Walmart greeters or cashiers selling made-in-China goods. Then we worried about job-loss as the Walmart greeter and cashier jobs turned into temporary jobs picking out orders at Amazon warehouses (or overseeing robots that did that). Now we're approaching the day at which we don't need either the Walmart store or even the American-based Amazon warehouse or distribution center. Instead, the item just gets mailed directly to your house by some low-wage worker in China.

That scenario is a bit too much even for Bezos, who made his billions in part by ruthlessly and efficiently cutting costs to offer customers the lowest price in an Internet shopping environment where prices were more transparent and easily comparable than ever before.

Last year, Amazon's vice president for global public policy, Paul Misener, testified before a House of Representatives subcommittee, complaining about international agreements that give Chinese companies a cheaper deal on U.S. Postal Service delivery than American ones. "This disparity discriminates against American businesses shipping domestically. To allow fair competition in shipping to U.S. consumers and equitable treatment of American businesses, the international agreements must be reformed," Misener said.

The Amazon lobbyist sounded quite a bit like Trump, complaining about international trade deals that favor foreigners over Americans, and calling for those deals to be renegotiated.

"American businesses of all sizes end up paying more than Chinese companies for deliveries to American consumers," Misener testified. "Chinese companies end up getting a better deal from the USPS than American businesses. Amazingly, when combined with extremely low bulk shipping rates from China to U.S. transfer points, shipments from China to points throughout the United States are often cheaper than shipments entirely within the United States." In other words, it costs less to mail the item I bought directly from China than to deliver it from an American-based Amazon distribution center.

Misener called the deals that give the Chinese lower shipping costs than American companies a "serious problem."

The Bezos-owned Washington Post highlighted the issue in a 2014 article with the provocative headline "The Postal Service is losing millions a year to help you buy cheap stuff from China." (The Post reporter who wrote that story, Jeff Guo, told me that the idea for it did not come from Bezos.)

Earlier this month Trump issued a Facebook post stating, "Based on the incredibly inaccurate coverage and reporting of the record setting Trump campaign, we are hereby revoking the press credentials of the phony and dishonest Washington Post." In a statement, the Trump campaign amplified the message, complaining, "The Washington Post is being used by the owners of Amazon as their political lobbyist so that they don't have to pay taxes and don't get sued for monopolistic tendencies that have led to the destruction of department stores and the retail industry."

This triggered a spate of news coverage accusing Trump of dictatorial tendencies or of mistakenly underestimating the Post's editor, Martin Baron, who was a memorable character in the Oscar-winning movie about the Boston Globe's investigation of sex abuse by Catholic priests in Boston, Spotlight.

What it really demonstrates, though, is Trump's unfortunate knack for making enemies out of potential allies. Reporters, whether at Fox News or at The Washington Post, will be unruly. But if Trump is the dealmaker he touts himself as, he'll make public peace with Bezos the way he did with Kelly. Maybe part of their parley can be devoted to a presentation from Misener about the postal rate issue.

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    1. Too mushy for you, Crusty?

      1. I mean as long as they’re not going to kiss like Gavin and Milo, at least I really do not want to see that…

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      2. I expect euphemisms from commenters, but the Reason should be above such juvenile behavior. Grow up, Reason.

        1. They’ve been too mean to the Donald, and now they’re getting in touch with their feminine side. What’s not to love?

  1. RE: How Trump and Bezos Can Bury the Hatchet: New at Reason

    I don’t think Trump the Grump will win the election.
    It appears that Heil Hitlery will win hands down.
    Socialism over fascism.
    Damn!
    And I invested so much money in brown shirts and jackboots.
    I should have invested in gulags and re-education camps.
    I’ll never learn.

    1. I think you mean “fun” camps comrade, and oh, you will have “fun” there.

      1. I’m sure someone will.

  2. So the Donald is mad at Bezos over WaPo. To be honest, WaPo has a pretty even mix of hit pieces going on. There’s plenty of hit pieces there on Hillary. Reason actually has a lot more hit pieces on the Donald than WaPo. He should just get over it.

    1. It’s not even by a country mile. Every time I see a hit piece on Trump on my news homepage, it comes from WaPo, and on any given day, you can find a minimum of three but closer to five negative pieces on on Trump on WaPo’s front homepage.

      1. Maybe there’s a reason so many newspapers and cable news outlets hate Trump. Maybe it’s not because they are big establishment meanies.

  3. Look at the bright side of all this election stuff anyway, Reason has posted a kitty in an Amazon box. I want to see kitty drone delivery. That would make Amazon the most coolest company ever.

  4. No seriously, Trump should just get over it. Who cares, stop being such a fucking baby, Donald, you’re starting to remind me of Obama. I can’t really think of who else in politics is that thin skinned and petulant.

    1. Why should he? His supporters love it. And most of the rest of the country doesn’t care. Thinking Washington Journalists are worthless shit bags is one of the few things the country can agree upon. There is really no downside to abusing the media and there is usually at least some upside. So why stop?

      1. Well, let him continue, I don’t care either way.

  5. I swear, Trump is the most whiny little bitch I’ve ever seen. Yes, WaPo leans left and would be attacking any GOP nominee as “the second coming of Hitler,” or some such thing, but Trump doesn’t do himself any favors by going after meaningless “targets” when he’d be better off just focusing on the Dems/Clinton.

    1. Fucking grow up. It’s about time someone took it to these shitbag media outlets. you’re just being a bitch because ewww icky Trump. In this you’re a useful blowjob artist for the establishment.

      1. Newsflash: Trump isn’t taking it to these shitbag media outlets, he’s just fucking himself over even more than usual because people can’t stand the asshole. Even people who might distrust the media will largely take their side over Trump’s because of what a douche he is to everybody. The worst thing Trump could do is to keep attacking the media over irrelevant bullshit and give them more credibility. Like the phony fundraising venture he did for the veterans (which the WaPo called him out on). Go eat a bag of dicks.

      2. Trump’s just mad the he doesn’t own WaPo. If he owned his own newspaper empire like Rupert Murdoch you can bet he’d be the second coming of Randolph Hearst.

        Or well, not, because there is a reason he doesn’t own a chain of newspapers. It’s because he’d suck at it.

  6. So, what are the odds at the present time for a little coup at the Republican Convention, now that a quite likely loss of the whole shebang is staring them in the face?

    1. Zero. The delegates are not going to vote to change the rules after the fact.

    2. None, zero.

  7. American businesses of all sizes end up paying more than Chinese companies for deliveries to American consumers,” Misener testified. “Chinese companies end up getting a better deal from the USPS than American businesses. Amazingly, when combined with extremely low bulk shipping rates from China to U.S. transfer points, shipments from China to points throughout the United States are often cheaper than shipments entirely within the United States.” In other words, it costs less to mail the item I bought directly from China than to deliver it from an American-based Amazon distribution center.

    But American consumers benefit from that. Why make everyone poorer by charging more to send foreign goods into the country?

    1. It’s the subsidy that rankles me. Either the USPS is subsidizing foreign shippers or overcharging domestic shippers.

      1. I can order an electronic component on eBay for $3.50 including shipping. It arrives from Taiwan in 2-3 weeks, presumably in a bulk ocean container and then USPS from the port. If my company were to ship that item it would cost about $2.50 first class, leaving $1 left for processing the order, the padded envelope, paying the shipping clerk, oh and yeah, the actual item. Just amazing but someone is losing their shirt somewhere and I think it is blue and has an eagle on the sleeve.

        The other thing that torques my lug nut. USPS delivers junk mail at a very heavy discount rate, by some accounts below cost – the proverbial sell below cost but make it up in volume. So I am subsidizing the destruction of natural resources (trees, energy) to fill up my own mailbox with crap that I then must expend more time and energy to dispose?! Arggh.

    2. The lose money on every shipment but make it up in volume?

      The USPS was basically rolled in this agreement and already renegotiated it slightly.

      They were gulled by visions of e-commerce. and probably junket to China where they were “entertained.”

  8. How Trump and Bezos Can Bury the Hatchet

    … on to each other’s pretty little head.

    The Amazon lobbyist sounded quite a bit like Trump, complaining about international trade deals that favor foreigners over Americans, and calling for those deals to be renegotiated.

    The difference is that the USPS is not a trade deal, it is a shipping rate deal from one government-owned company and Chinese shippers. The Amazon lobbyist is not sounding like Trump at ALL, since El Trumpo’s complaints derive from his total lack of economic understanding and populism.

    1. it is a shipping rate deal from one government-owned company and Chinese shippers.

      Yeah, and those are called “trade deals”. Why do you think they get that rate if not because they were negotiated as part of a larger trade agreement? Does the USPS just like the Chinese?

      Beyond that, the same argument that says that it is a good thing when foreign governments subsidize their exports to undercut American producers is a good thing, also says this is a good thing. So you should be applauding this.

      1. Is it really Chinese only, or all foreigners, or some foreigners?

      2. The problem here is that the Postal Service is not a private entity. They should be negotiating their own rates, not having the US government ordering them what they have to charge various customers.

      3. Re: John,

        Yeah, and those are called “trade deals”.

        When it comes to International Commerce, John, a Trade Deal involves much more than the standard rates a company (since the USPS is still a company, even if government-run or managed) offers certain foreign shippers. Maybe the USPS has no business giving Chinese shippers better rates than it offers to American companies considering American companies subsidize the USPS through taxes every time Congress bails them out, but that is a totally different conversation and situation than what Trump says whenever he attacks trade with China. Trump objections to trade stem from his misunderstanding of what really happens when Chinese companies trade with Americans. USPS is a single company which is run by the government, so whatever deal it has with Chinese shippers happens to be a CONTRACT and not a ‘trade deal”. Otherwise I could call the contract I have with my cable provides a “trade deal.”

        Beyond that, the same argument that says that it is a good thing when foreign governments subsidize their exports to undercut American producers is a good thing, also says this is a good thing. So you should be applauding this.

        Only if I agreed to the existence of the USPS, which I don’t. Therefore your proposition is fallacious.

      4. Beyond that, the same argument that says that it is a good thing when foreign governments subsidize their exports to undercut American producers is a good thing, also says this is a good thing. So you should be applauding this.

        Foreign governments soaking their own taxpayers to subsidize what I buy is not even close to the same as my shipping charges and taxes subsidizing what the Chinese ship here. Ar eyou really that economically illiterate and logically challenged?

        1. Thanks, this puts it more succinctly. If China wants to waste it’s people’s money helping us buy stuff, more power to them. When they waste MY money subsidizing USPS, or any other business that hurts ME.

  9. “What it really demonstrates, though, is Trump’s unfortunate knack for making enemies out of potential allies.”

    If you were paying attention at all, WaPo established that they already were enemies. Did you see Trump talking about WaPo before they stuffed their opinion pieces with nothing but hit pieces? Don’t start none, there won’t be none.

    1. Waaaaaaa! Washington Post won’t run puff pieces on me! Me so mad! Me throw hissy fit!

  10. So, this articles thesis is that Trump and Bezos should get along because both of them are mad that consumers can buy cheap crap from China?

    And we’re happy about that why?

    I DON’T WANT the enemies of free trade to get along.

    1. Bezos has plugged in Chinese sellers to amazon-USA and amazon-europe.

      He’s fine with free-trade.

  11. “The Postal Service is State and local governments are losing millions billions a year to help you buy cheap stuff from China Amazon.”

    Losing their shipping advantage would be a big blow to Amazon.

    And their sales tax advantage.

    1. Amazon already pays sales tax where it has a nexus which basically everywhere.

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