Amazon & The Cost Of Consumerism
Over the weekend, the Times published a balanced story about the continuing fight between Hachette and Amazon, a piece that discussed both the good and the bad of Amazon.com’s bigfooting the US book business. The reporter looked at the dispute through the eyes of Vincent Zandri, an American author who is making a good living publishing his books through Amazon, and who has adopted a “good riddance” attitude towards the Big Five publishers. But now that Amazon has a monopsony, he’s rethinking things:
Two years ago, he wrote about publishers on his blog: “I know I’m supposed to cry for these people, but they had a chance to survive and in fact thrive in today’s digital book publishing world, but they haven’t. And now they are going the way of the eight-track. Bon voyage.”
It’s not that simple anymore.
“Publishing is a shyster business,” he reflected. “One day it’s ‘You rock, bro,’ and the next day they’re not returning your calls. If I’m not moving books on Amazon, they’re not going to ask me back. It’s not a charity.”
Amazon looks so good because it has the rest of publishing to compete against. But if those publishers wither, maybe that would not be true.
In the story — and this is something confirmed by friends of mine in publishing — the Times quotes a lawyer saying that in the US, the government and the courts almost always take the side of the individual consumer. Amazon is likely to win this one.
But this raises an interesting question: is the common good reachable by the consensus decisions of individual consumers? Or, put another way, what are the hidden costs of making lower prices an absolute good?
On yesterday’s Fresh Air radio show, Beth Macy, author of a new book about a furniture maker’s struggle to stay alive in the face of Chinese competition, talked about how the Chinese gamed the system, and how we Americans — free-traders from both parties — let them do it. Excerpt:
There’s a dresser that’s just come on the scene [in 2001] in the American market and it’s a Louis-Philippe [style] dresser. It’s wholesaling for $100 and [John Bassett III] can’t figure out how the heck [the Chinese company is] able to sell it. “They can’t be making money,” he says. He has his engineer take it apart and deconstruct it piece by piece and price out the pieces. And he knows they have to be “dumping,” which means selling it for less than the price of the materials.
So he sends his son Wyatt, who is kind of his head business guy, he sends him and a … translator, who is a family friend, to Dalian because the stick on the back only says “Dalian, China.” It doesn’t say exactly which factory it’s from. And he sends them off to do a secret spy mission. They’re pretending that they’re looking to buy — but what they’re really looking for is that one particular dresser.
They find it after days and days of searching. They finally end up in this remote section of the province, almost to the border of North Korea, and they find it there. … The gentleman running [the factory] actually meets with them and he has this very chilly one-on-one dialogue with them that’s all translated. But the guy says, basically, “Close your factories.” (Bassett’s got three factories left at the time.) “Close your three factories and let me make all of your furniture for you.” …
The translated word, and John [Bassett III] remembered it very well, was “tuition”… “This is the tuition of [China] being able to capture your market share. We’re going to sell it so cheap and with government subsidies — we’re going to be able to make all of your furniture for you.”
They ended up driving them out to this furniture industrial park, out in the country and there [are] just stacks and stacks of timber. … When [Wyatt] saw all that Russian timber laid out they knew [the Chinese] were serious. And they knew they were going to war.
The cost of all this cheap Chinese furniture includes closed American factories, dying American towns, and hundreds of thousands of good American jobs. The thing is, the Chinese did not operate under fair trade rules. You can’t say, “Well, that’s the free market.” What free market? Chinese manufacturers operating with government subsidies designed to destroy the US furniture industry?
Amazon doesn’t do that, of course, but there’s a cost to adopting its model. Pamela Druckerman, an American writer who lives in Paris, writes about how the French are resisting the Amazon model, because they don’t view books as mere products. Excerpt:
What underlies France’s book laws isn’t just an economic position — it’s also a worldview. Quite simply, the French treat books as special. Some 70 percent of French people said they read at least one book last year; the average among French readers was 15 books. Readers say they trust books far more than any other medium, including newspapers and TV. The French government classifies books as an “essential good,” along with electricity, bread and water. (A French friend of mine runs a charity, Libraries Without Borders, which brings books to survivors of natural disasters.) “We don’t force French people to go to bookstores,” explains Vincent Montagne, head of the French Publishers Association. “They go to bookstores because they read.”
None of this is taken for granted. People here have thought for centuries about what makes a book industry vibrant, and are watching developments in Britain and America as cautionary tales. “We don’t sell potatoes,” says Mr. Moni. “There are also ideas in books. That’s what’s dangerous. Because the day that you have a large seller that sells 80 percent of books, he’s the one who will decide what’s published, or what won’t be published. That’s what scares me.”
The French aren’t being pretentious or fetishizing bookstores. They’re giving voice to something we know in America, too. “When your computer dies, you throw it away,” says Mr. Montagne of the publishers’ association. “But you’ll remember a book 20 years later. You’ve deeply entered into a story that’s not your own. It’s forged who you are. You’ll only see later how much it has affected you. You don’t keep all books, but it’s not a market like others. The contents of a bookcase can define who you are.”
On the other hand, France’s conservatism on this kind of thing is connected to its economic stagnation, writes Roger Cohen. Excerpt:
The redefinition of space has involved the technology-driven elimination of distance. As Michel Serres, a prominent French philosopher, put it in alecture last year at the Sorbonne on the digital world, “Boeing shortens distances; new technologies annul them.”
This is troubling in France because nowhere else is the particularity of place and the singularity of a person’s attachment to it more important. That bond is expressed in the word “terroir,” at once the land, its special characteristics, the nature of its soil, its climate, and the unique human relationship to it. A great Burgundy and an indifferent one may come from properties a hundred yards apart. The soil is not the same, nor the slope of the land. Distance matters. Yet modernity has contempt for it. It even places the Tour de France in England. As Serres put it, “We live in a new space.”
But technology has shifted power from the state to stateless individuals living in a borderless cyberworld. An e-mail address is now more important and more relevant to the conduct of existence than a physical address. A revolution in communication is underway, not seen since the invention of the printing press, but it is not a French revolution. It is in fact an anti-French revolution. It challenges fundamental French values, the French sense of self, and the French attachment to the state.
Valls, the prime minister, appears to be confronting French labor unions in his efforts at reform. What he is really facing is a fundamental objection to modernity.
Read the whole thing, which makes for a fascinating contrast with Druckerman’s essay.
Me, I’m divided. I love bookstores more than I love my own home, and mourn their disappearance. Yet my own life here in the country, and all the good things that come with it, is made possible by Amazon.com. I still shop at brick-and-mortar bookstores every chance I get, but if not for Amazon, I couldn’t live here and prosper here. Just the other day, I went to the local library looking for a book I needed for a research project. They didn’t have it. I resolved to go to the state library in Baton Rouge to look for it, but then had the idea to see if it was available on Kindle. It was, for $9.99. It would cost me that much in gas just to go to Baton Rouge and back. I bought the Kindle version, and now have it on my iPad. That is a marvelous thing, and I’m grateful for it. And I suppose that implicates me in the very thing I fear and criticize.
But does recognizing the good that Amazon provides require us to grant Amazon the space it demands in the book market? Once we cut down all the middlemen coming between us and our books, in the name of lower prices always, what mediating institutions will protect us from Amazon’s will? The institutions we have now, and depend on, are inefficient, but do they serve hidden goods that we will not be able to perceive until they have disappeared? I think about this a lot, but I cannot settle on an answer. Maybe you have. Is there a feasible middle ground, or has technology simply obliterated the possibility of staking out a middle ground?