The One Thing That Could Stop Amazon-Whole Foods

Amazon Whole Foods

One word: Trump.

The Hill on the regulatory background:

Some industry analysts say the deal should face a relatively smooth path to federal approval because Whole Foods only represents a 1.2 percent share of the $800 billion grocery market, while Amazon only has a 0.2 percent share. […]

“There’s real pent-up demand to go after the online platforms for their market dominance, and real fear among the supermarkets and other industries that could be impacted by Amazon,” Becker said, noting that there had been a perception that the Obama administration was too cozy with tech companies like Google. “This could be the tip of the spear of that effort.”

The current president is rather vengeful and someone who prefers gestures and corporatism to politics and capitalism.

Only one year ago, Trump, while on the campaign trail, said Amazon founder and CEO Jeff Bezos has “a huge antitrust problem because he’s controlling so much.” Bezos is also the owner of The Washington Post, a publication Trump has clashed with in the past.

Given that Jeff Bezos owns The Washington Post, Amazon’s pending acquisition of Whole Foods, then, becomes a litmus test. How far is the current US administration willing to go to interfere with / regulate e-commerce and the ongoing rise of tech in general (to settle a score)?

We can already see a potential opening line for an alibi as some are saying that this acquisition is uncharted territory. (which it is) The Hill:

Many say the Amazon-Whole Foods deal is uncharted territory, likely requiring regulators to set new precedent.

“This will be a really interesting case for both congressional oversight and for the new Republican regulators at the Justice Department and the Federal Trade Commission [FTC],” said Becker, who also formerly served as chief of staff to Sen. Amy Klobuchar (D-Minn.), the top Democrat on the Senate subcommittee that handles antitrust issues.

While the Senate will likely confirm the head of the Justice Department’s Antitrust Division — former lobbyist Makan Delrahim of Brownstein Hyatt — soon, Trump has not nominated anyone to lead the FTC.

If the acquisition of Whole Foods gets stopped by regulators -with no objective reason for this- all bets are off for the US market and the future of online retail in the US. If your regulatory framework becomes unpredictable, so does the future of your industry.

Amazon is spending a lot on lobbying compared to just a few years ago. The Hill:

The company went from spending $2.5 million per year on lobbying in 2012 to surpassing that amount in a single quarter now. […]

During the first three months of 2017, Amazon shelled out $2.9 million to advocate before the federal government.

But that won’t solve personal animosities.

More on this topic:

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: