ABA Criticizes President’s Choice of Venue for Jobs Speech

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On the heels of press reports that Amazon has drastically lowered the price on many hardcover titles, on Monday, July 29, the Board of Directors of the American Booksellers Association and CEO Oren Teicher criticized President Obama’s decision to hold his jobs speech this week at an Amazon facility in Tennessee. In a letter to the President, they called the choice of venue “greatly misguided” and explained that Amazon’s business practices have cost the country far more jobs than they have created.

“While Amazon may make news by touting the creation of some 7,000 new warehouse jobs (many of which are seasonal), what is woefully underreported is the number of jobs its practices have cost the economy,” Teicher and the Board wrote on behalf ABA’s bookstore members. “For you to highlight Amazon as a job creator strikes us as greatly misguided. As you’ve noted so often, small businesses are the engines of the economy. When a small business fails and closes its doors, this has a ripple effect at both a local and a national level. Jobs are lost, workers lose healthcare and seek unemployment insurance, and purchasing decreases.”

Teicher and the Board stressed that Amazon’s practices are detrimental to the nation’s economy. Pointing to figures released by the Institute for Local Self-Reliance, they noted that every $10 million in spending that shifts from Main Street retailers to Amazon.com results in a net loss of 33 retail jobs. In 2012, Amazon’s sales increased by $13 billion. “That would mean … Amazon cost the U.S. economy more than 42,000 retail jobs just last year,” they wrote.

“At a time when Main Street retailers, including indie bookstores, show promise of recovering from the recession, we are disheartened to see Amazon touted as a ‘jobs creator’ and its warehouse facility used as a backdrop for an important jobs speech, when, frankly, the exact opposite is true,” Teicher and the ABA Board said.

In conclusion, they invited President Obama to continue the conversation with “a group of real job creators” at a meeting at his favorite local, independent bookstore. “We’ll buy the coffee!” Teicher added.

Read the letter in full below.


July 29, 2013

President Barack Obama
The White House
1600 Pennsylvania Avenue NW
Washington, DC 20500

Dear President Obama:

On behalf of the American Booksellers Association, we are writing today to call your attention to how Amazon’s business practices are actually harming small businesses and the American economy. While Amazon may make news by touting the creation of some 7,000 new warehouse jobs (many of which are seasonal), what is woefully underreported is the number of jobs its practices have cost the economy.

For you to highlight Amazon as a job creator strikes us as greatly misguided.

As you’ve noted so often, small businesses are the engines of the economy. When a small business fails and closes its doors, this has a ripple effect at both a local and a national level. Jobs are lost, workers lose healthcare and seek unemployment insurance, and purchasing decreases. And while Amazon may now be boasting about the creation of jobs, any gains are elusive, and not a long-term solution.

The simple fact is that Amazon’s practices are detrimental to the nation’s economy.

The news this weekend that Amazon is slashing prices far below cost on numerous book titles is further evidence that it will stop at nothing to garner market share at the expense of small businesses that cannot afford to sell inventory below their cost of acquisition. In the end, monopolies are bad for consumers — and there are no examples in American history that prove otherwise.

For more than a decade now, Amazon has flouted sales tax laws in an effort to maintain a competitive advantage over Main Street businesses. To date, 16 states have passed sales tax laws to level the playing field for bricks-and-mortar businesses, and in all but three of those states Amazon (as well as Overstock.com) has fired its online affiliates in order to evade collecting and remitting sales tax to the state (two of the 16 states only just passed their sales tax laws). This has resulted in many online affiliates going out of business. Moreover, by eschewing its obligation to remit sales tax, Amazon has negatively impacted state budgets and services, as well as those of local communities.

In addition, Amazon’s continued practice of using books, both in print and e-book formats, as  “loss leaders” in an effort to increase their already immense market share of the retail book trade and to up-sell large-ticket items has impacted Main Street retailers and the communities in which these stores are located in ways that can be calculated (job losses, store closures, a decrease in sales tax revenue, etc.) and in ways that simply cannot (urban blight, budget cuts affecting first responders and other community services, etc.).

All told, according to the Institute for Local Self-Reliance, every $10 million in spending that shifts from Main Street retailers to Amazon results in a net loss of 33 retail jobs. That would mean for 2012 alone — using Amazon’s own numbers about its increase in sales — Amazon cost the U.S. economy more than 42,000 jobs just last year! 

At a time when Main Street retailers, including indie bookstores, show promise of recovering from the recession, we are disheartened to see Amazon touted as a “jobs creator” and its warehouse facility used as a backdrop for an important jobs speech, when, frankly, the exact opposite is true.

Conversely, the value of a local business to its community cannot be overstated — whether through job creation or in the myriad ways it gives back to the community.

We would love to continue this timely and important conversation with you. We’ll bring together a group of real job creators to meet at your favorite local, independent bookstore! And we’ll buy the coffee!

Sincerely,

Oren Teicher, CEO
American Booksellers Association
White Plains, New York

Steve Bercu, ABA President
BookPeople
Austin, Texas

Betsy Burton, ABA Vice President
The King’s English Bookshop
Salt Lake City, Utah

Sarah Bagby
Watermark Books
Wichita, Kansas

John Evans
DIESEL, A Bookstore
Santa Monica, California

Valerie B. Koehler
Blue Willow Bookshop
Houston, Texas

Matthew Norcross
McLean & Eakin Booksellers
Petoskey, Michigan

Annie Philbrick
Bank Square Books
Mystic, Connecticut

Robert Sindelar
Third Place Books
Lake Forest Park, Washington

Jonathon Welch
Talking Leaves Books
Buffalo, New York

Ken White
Books Inc.
San Francisco, California