In the News: Stacy Mitchell
November 9, 2017
Media Outlet: The Hill
As discussed in The Intercept earlier this month, Amazon is now on the verge of winning a multi-billion dollar contract to win government procurement over other retailers in America. Ali Breland of The Hill takes on the issue and, for an expert perspective, she reaches out to ILSR co-director and Community-Scaled Economies initiative director Stacy Mitchell.
Here’s Mitchell’s contributions:
Lawmakers put the finishing touches this week on military funding legislation that contains a provision that stands to significantly benefit Amazon.
The amendment, Section 801 of the National Defense Authorization Act (NDAA), would help Amazon establish a tight grip on the lucrative, $53 billion government acquisitions market, experts say.
The provision, dubbed the “Amazon amendment” by experts, according to an article in The Intercept, would allow for the creation of an online portal that government employees could use to purchase everyday items such as office supplies or furniture.
This government-only version of Amazon, which could potentially include a few other websites, would give participating companies direct access to the $53 billion market for government acquisitions of commercial products.
“It hands an enormous amount of power over to Amazon,” said Stacy Mitchell of the Institute for Local Self-Reliance, a research group that advocates for local businesses.
Mitchell said that the provision could allow Amazon to gain a monopoly or duopoly on the profitable world of commercial government purchases, leaving smaller businesses behind and further consolidating the behemoth tech firm’s power.
Amazon declined to comment to The Hill on Section 801. …
In a briefing on Wednesday before the bill’s release, senior House and Senate Armed Services committee staffers explained that, in addition to Amazon and Walmart, Staples and industrial supply company Grainger would be eligible to also provide commercial items.
But Mitchell is skeptical, pointing to language in the current version of the bill that would appear to exclude Staples and Grainger.
“The way the language reads to me, it’s hard to imagine that there are any other companies who would fit the bill besides Amazon and perhaps Walmart,” she said. “Those are the only retailers who are operating online marketplaces who seem to be in a situation to create a government marketplace portal that this provision envisions.”
The House Armed Services Committee contests the idea that Section 801 will only benefit one or two companies, saying that multiple companies will have access to the government procurement market in the final version of the NDAA.
“[Amazon’s dominance of government procurement] is a myth that opponents of the provision have been shopping for a while, that we wrote the language in such a way as to exclude more specialized marketplaces,” a representative from the House Armed Services Committee told The Hill over email, adding that some of Section 801’s language had been changed in the latest version of the provision.
House Armed Services Committee Chairman Mac Thornberry (R-Texas) has made a strong push for online marketplace reform. In addition to advocating for the amendment, he also introduced a standalone bill in May that shares similar goals with Section 801.
Mitchell and other experts believe that Section 801 could have harmful impacts.