The federal government is steering small businesses to do more business with Amazon to help them recover from the economic crisis prompted by the pandemic.
The U.S. Commercial Service, a trade promotion agency, is hosting a series of "Go Global" webinars with Amazon in June to teach small businesses to access markets in Singapore and the United Arab Emirates by becoming sellers on the e-commerce behemoth. Some entrepreneurs are crying foul, blaming Amazon as the source of their woes.
Gina Schaefer opened up her first hardware store in Logan Circle, Washington, D.C., in 2003. Alongside her husband, she expanded the business to 13 locally owned hardware stores, employing roughly 300 people in the D.C., Maryland, and Virginia metro areas. She said a retailer like Amazon is the last place to which the federal government should turn to help small businesses.
"The larger Amazon has gotten, the fewer number of independent businesses we have," Schaefer told the Washington Free Beacon. "One by one industries have been picked off by predatory pricing and overlooked government regulations to the point where starting a new business, at least in the retail sector, is nearly impossible."
The agency's webinars with Amazon are designed to get clients for the web giant. The lessons on offer at the June 15 event included helping businesses create Amazon Global Accounts. A follow-up webinar in July will teach entrepreneurs how to not only team up with Amazon but also with U.S. trade authorities.
"We will cover … how to sign up for a [Amazon] Global Seller Account … [and] the role the U.S. Commercial Service plays in providing comprehensive export counseling to support your global business strategy," the event page says. "We'll connect you … to explore free resources and government funding to support your e-Commerce and export-related activities."
In response to Amazon's growing market dominance, small businesses are forming coalitions seeking to leverage anti-trust legislation to ensure that they are not crushed. Schaefer, a member of the Small Business Rising coalition, said the Commercial Service partnership with Amazon will further undermine small businesses as they struggle in the post-lockdown economy to stay independently viable. Like many other small business owners in retail, she supports the idea of Amazon being broken up.
"No one ever envisions that street empty or only populated by a soulless Amazon store. Yet businesses are failing at alarming rates now, in large part to concentrated market power," Schaefer said.
Amazon has maintained close ties with American trade officials over the years. It employed 28 lobbyists working on trade issues in 2020 and 2021 as part of its multimillion-dollar influence operation, according to federal lobbying records. Seven of those lobbyists held high-ranking trade-related positions at the federal government, including at the U.S. Commercial Service and the Office of the U.S. Trade Representative, before joining the Silicon Valley giant. Its leadership has also been closely allied to Democrats, with employees contributing more than $2 million to the Biden campaign and 75 percent of its donations going to benefit Democrats, according to the Center for Responsive Politics.
Representatives from the U.S. Commercial Service and Amazon did not respond to requests for comment.
Small business advocates say that the mass closures of mom-and-pop stores during the pandemic require bold steps from lawmakers. Sarah Crozier, of Main Street Alliance, faulted the Biden administration for promoting Amazon rather than cracking down on alleged market manipulations.
"The federal government is critical to help level the playing field for small businesses by improving anti-monopoly protections against giants like Amazon and creating opportunity for small businesses," Crozier said.
Some lawmakers have begun speaking out against Amazon's sway within the administration and on Capitol Hill. Rep. Ralph Norman (R., S.C.) said Amazon has not proven to be a faithful business partner to the third party sellers that populate its website.
"From motor oil to children's clothing, we need to know if the oddly random (and growing) list of Amazon's own products were identified and developed by exploiting sales & product data from its third party sellers. And we need to know why there are countless reports of retaliatory and anti-competitive conduct from Amazon," Norman said. "On multiple fronts, Amazon has given us plenty to be concerned with. Congress needs answers about the rampant reports of harmful and monopolistic behavior from that company."