The following is presented as part of The Columbian’s Opinion content, which offers a point of view in order to provoke thought and debate of civic issues. Opinions represent the viewpoint of the author. Unsigned editorials represent the consensus opinion of The Columbian’s editorial board, which operates independently of the news department.
I see that the reality carnival show that is this presidency is now said to be “obsessed” with Amazon and its founder, Jeff Bezos.
Every day the president twitter-barrages all manner of ALL-CAPS attacks on Amazon, apparently in service of finding a way, any way, to “(bleep) with” Bezos and his superstar company (and more likely, his other company, The Washington Post).
Perhaps I could be of some small assistance in this squabble? By stating: Trump, you’re bashing Amazon all wrong.
For starters, it’s been well-established by fact checkers that the president’s anti-Amazon harangues have been mostly off the mark. No, the company isn’t bleeding the Post Office to death on package deliveries. No, the company isn’t paying zero state and local taxes (at least not anymore).
But I would humbly suggest there is something fundamentally off-kilter about the company’s relationship with its home country.
The big problem is this: Last year, Amazon paid zero federal income tax. That’s right: $0, on pretax profits of $5.6 billion. It means that I, the lowly scribbler of a couple columns a week, paid more to support the federal government and its myriad programs in 2017 than the high-tech corporate entity that is said to be one of the great economic engines in world history.
When you report your own taxes in the next couple weeks, look at the total tax paid. Whatever it is, if it’s a positive number, then you paid more federal tax than Amazon, too (I’m talking about the corporate entity, not its hundreds of thousands of employees).
Last year, a New York University business professor totted up Amazon’s corporate tax burdens and found what he called “the most disturbing fact in business.” Since 2008, Walmart (remember when it was the evil company?) has paid $64 billion in corporate income tax, the professor, Scott Galloway, found. Amazon? $1.4 billion.
Concluded Galloway: “The most uncomfortable question in business, in my view, is how do we pay our soldiers, firefighters, and teachers if a firm can ascend to $460 billion in value (No. 5 in the world) without paying any meaningful corporate taxes.”
Since he wrote that, Amazon has added an additional $240 billion in market value, making it No. 4 in the world.
Boosted by tax cut
Also since then, Republicans in Congress passed, and Trump signed, a massive corporate tax cut, putting the cost of it on the nation’s credit card. Amazon got a one-time windfall totaling $789 million, as well as reduced tax burdens going ahead. Yet all the while, it is going around requesting still more tax breaks for its second headquarters.
Amazon’s financial statement reveals it did end up paying taxes somewhere in 2017: overseas. It reported owing $724 million in international taxes, and just $211 million in state taxes across the United States (and again, zero to the federal government). So a rock star American company that has two-thirds of its sales in America nevertheless paid three-fourths of its taxes to other countries.
That’s what the president should be fired up about. If Amazon is helping pay for soldiers, firefighters and teachers, it’s mostly in places like Germany and Japan.
Trump is right: There is a war on of sorts. It isn’t the delusional one the president thinks he’s fighting. But Amazon is winning it just the same.
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