Big Technology Podcast - The Uneasy Amazon Coalition, With Fulfillment Author Alec MacGillis

Episode Date: April 7, 2021

ProPublica senior reporter Alec MacGillis highlights the growing economic divide in the U.S. — through the lens of Amazon — in his new book, Fulfillment. MacGillis joins Big Technology Podcast to discuss the state of the union push inside Amazon, how labor has changed more broadly in the U.S., and the uneasy political coalition between those packing and delivering Amazon packages and those receiving them.

Hey, Alec. Hi. How's it going? I have your book right here. I've really enjoyed it, and I'm thrilled that you're on the show. Okay, I will hit play on the ad. We have a new sponsor, Main Street, and then we can jump right into the conversation. Hello and welcome to the big technology podcast, a show for cool-headed, nuanced conversation of the tech world.

and beyond. Alec McGillis is the author of fulfillment, winning and losing in One Click America, a terrific, terrific new book about Amazon's impact on our economy and society. And more broadly about how our society concentrates power and wealth in the hands of the few, it makes it extremely difficult for others to break through. He is also a senior reporter at ProPublica. Alec, welcome to the show. Thank you. Thanks for having me. Okay, so why don't we start with the news? So, um, Amazon's been flailing a bit with its PR strategy. On Twitter, it was taunting the members of the Senate and a member of the Congress and basically said to one of them, you don't believe our workers really pee in bottles, do you?

Amazon workers were like, yeah, we do. And they were sending pictures of those bottles to vice. And then they leaked a memo of a manager reprimanding them for leaving, for pooping in bags and leaving them in the vans. and they lead that to the intercept and Amazon look pretty stupid and this all stems from a union drive in Bestboro, Alabama, where a massive fulfillment center is

in the midst of a drive, they've actually already voted to unionize and I imagine we'll find out the outcome of what's going on there any day now. But I'd love to hear from your perspective. Your book is about fulfillment. No coincidence Amazon calls there warehouse's fulfillment centers and this is what I think is the biggest attempt to unionize

one of those to date or the most serious one but yeah I'm going to turn it over to you what's going on there oh it's just I mean it's an extraordinary moment really that and I you know you always wish when you're writing a book about that somewhat contemporary that that it would go to press a little later in this case I really wish the Bush the book had had gone to press after this development closed right before this news came out, this extraordinary news, that a union had managed to get enough support to hold an election. First time we've ever had an election at a full Amazon warehouse. And it's incredible that is happening in the deep south, although not as incredible as people,

I think, maybe think that Alabama is actually, as deep southern states go, has somewhat more history of union organizing than another and its neighboring states. And of course, had the history of the steel industry there. And Bessemer itself is, of course, named after the man who invented the modern steelmaking process, Henry Bessemer. And so we have this election there. And first time ever for Amazon, we've got to this point. And it's still, it's going to be incredibly tough. I mean, I think there's been a lot of excitement around this, understandably, that I think some of the excitement has somewhat overlooked the how stiff the odds still were for these organizers there.

You have Amazon pulling out all the stops to block this thing, including a crucial fact that gets, I think, often missed is that the number of people voting in this election is, really quite large. It's, you know, it's 5,800 or so eligible. 5,000 workers. Yeah. Yeah, which, which, you know, that, that number is so big because Amazon has fought to make it that big and has fought to include a whole swath of workers that, you know, that are arguably basically more sort of supervisor types, but have, they've kind of gotten them into that pool, which, of course, makes it harder for the union to get a majority because the more you grow that denominator the harder it is to get a majority. But we'll see. I mean, I would just say before we get

into how Amazon's going to fight it, the interesting thing is like what they're actually unionizing for inside this fulfillment center. So typically when you think of a union drive, the union will push for higher wages. And maybe that's part of it. But Amazon's minimum wage is double the federal minimum wage, $15 compared to, I think, $7.25. And what the push, is actually going on here is that they want better working conditions. They want a little bit more flexibility, maybe more break time, if I'm reading it right. Isn't that kind of fascinating that that's what the union drives have moved to with Amazon? Why do you think that's necessary? Well, it's necessary because these jobs are just so incredibly demanding. And we should note

that pay is definitely still a part of what they're fighting for. They workers, Amazon workers across the country are upset that they lost the $2 bump that they got at the start of the pandemic. The first couple months of the pandemic, Amazon gave them $2 extra, so they were up to 17. And then that was taken away very quickly. And so workers look at the company making just extraordinary profits this past year. Bezos's personal wealth, just up 50, 60 billion. And they're back to the same wage that they were at a couple years ago. So that definitely is part of it.

But yes, they're also fighting for better conditions. They're fighting to just basically have more say in how the job is done in these warehouses. You have the jobs are, there was a really good quote in the times the other day from someone who used to work in the Amazon warehouse. And it's now writing a dissertation on it for his doctorate in Minnesota. And just talk about how they're completely different. They've replaced retail jobs, but they're completely different than retail jobs. they're sort of physically taxing and relentless in a way that retail jobs were not. And they really are more like factory jobs.

And but they're not paid like factory jobs. And whether or they're certainly not paid like factory jobs used to. And so that's really, you know, what's at stake here is that you have this new kind of work. It's a kind of work that we've never had at this scale, that warehouse work, fulfillment work. at this enormous scale that Amazon has now kind of created and sort of how what that work is going to be like, just how physically relentlessly demanding it's going to be how much you're going to be under the constant thumb of really high performance quotas or, and then on top

of that just incredibly high surveillance of your performance minute by minute and then how you're going to be compensated for it is that's sort of what we're fighting over now. It's this new kind of mass work and what it's going to look like and what it's actually going to be like on a, you know, day-to-day basis for these workers. You live in Baltimore pretty close to where one of these Bethlehem steel plants has, you know, not been taken down and, you know, a fulfillment center has gone up on the same land. So what about your personal experience made you interested in writing a book like this, really take. taking a look at. And we're going to get into a little bit more in terms of like what these jobs are like. And I mean, I think there's a pretty good understanding about what the jobs like, but really what it means for our economy that these are like, you know, the, I imagine

the fastest growing job category in the country Amazon's added like what a million, a million workers in the last 10 years. But before we get into that, what about your personal experience? What about your viewpoint of the world made you feel like this was something that was worth locking in on and writing a book about it. Well, it really had nothing to do with the answer at the start. It was my upset, my anger really, over simply seeing the gaps and wealth that were being created around the country. It's regional inequality, regional disparities between places that were growing bigger than we've ever had really had before. We've always had rich or poorer places in the country, but not at the level that we

now. And for me, a lot of it did have to do with Baltimore. It had to do with seeing, moving back and forth between Baltimore, Washington, quite a bit these last 20 years that I've been in that region. And now being back in Baltimore for the past eight years as a resident and watching this incredible divide grow with Washington just 40 miles down the road, we're now to travel between the two of them. It's just utterly disorienting. They're just so wildly disparate in their prosperity and prospects and then wanted to write about those those divides which i felt so viscerally and felt felt were just so terrible for the country because they're bad for both people in both sorts of places and then settling on the amazon is the sort of

frame through us to tell that story and in the amazon of course it was just so was also so really so close to the Baltimore Washington story in the sense that so in few used in it because it, of course, chose, has chosen Washington to be its second headquarters, this massive investment of high-paid jobs and capital investment in Washington that'll make a wealthy city, even wealthier and more expensive. And then, in that meanwhile, just up the road, the company has built several warehouses and extraordinarily sort of symbolic, historically charged locations, the one of first of which was in a former GM plan, and the second of which, second and now third of which were at what used to be, yes, the largest steel mill in

the world. And that sort of that place, the fact that we've now in this exact same piece of land gone from this massive steelworks where you had workers doing really tough but well-paid work to now, in that exact same spit of land, working in a warehouse, to me just was so so emblematic of a certain transformation of work and of really kind of just daily existence in our country. And so it all kind of, it all started there in Washington and Baltimore, Washington. Yeah. And let's pull back a little bit. I mean, you talked about how you were mad about the regional divides, the divides in income inequality. Can you set the stage and talk a little bit more about what that means, like what that

actually looks like in the U.S. right now? Sure. I mean, we've always had gaps. Of course, you've always had places that were poorer, wealthier. But now, I mean, the numbers are very clear. It's similar to how the gaps are grown on the income ladder, the 1%, 9, 9% and all that. we've had similar spreading out happening polarizing effect happening in geography so uh recently as as 1980 only small parts of the country were poorer at 20 median incomes that were 20% below the

average or or lower than 20% below so only the deep south in appalachia were sort of fell below that that line and only really small parts of the country had incomes that were 20% above the average or more so DC some of the New York suburbs kind of fell above that line now just you know 40 years later I've had massive growth at the extremes entire swaths the country including almost the whole Midwest a lot of the great plains have incomes that are 20% below the average or poor or or poorer and then and then basically the entire coasts now have um incomes that are 20 above or higher and in places that were already wealthy before like dc are now just off the charts like dc's median income is metro dc's and median income is something like 50 or 70%

above the average and so you've had this spreading out of effect there and then and then and then much also has to do with where the wealth is that you used to have in the 60s, you had the wealthiest cities in the country in the 60s that the 25, you know, wealthiest city by median income were, many of them were in the Midwest. The list is really kind of astonishing. It's like Cleveland, Milwaukee, Des Moines, and Rockford, Illinois were on that list. Now there's only a couple non-coastal cities on a list of the top 25. So the regional gaps have just gotten a lot bigger. And the reason I settled on Amazon as the frames to tell the story is that it is that the tech

economy, big tech has played a not insignificant role. in that, in those growing regional disparities. Right. And your, your chapter on the way that wealth has accumulated to Washington was particularly eye-opening to me, the rise of lobby firms and the rise of contractor, like contracting companies that have now, you know, made tons and tons of money, basically working for the Department of Defense or other agencies. You mentioned there was somebody in a Washington suburb who had built a mansion that was styled off of Versailles. I mean, how is government money ending up in situations like that?

It's crazy to me. Yeah, I mean, I was, I was, I lived in Washington from 2005 to, to 13. And, and to see, I mean, just so I was there throughout those great recession years and to see the city get, if anything, the city got. even wealthier during the Great Recession. It was just stunning to watch. It was partly because a lot of the stimulus money, the Obama stimulus money, kind of stayed in Washington because a lot of it was basically awarded to those big beltway bandit contractors, like Booz Allen and those guys.

They actually administered a lot of that spending for the government, and they kind of took their cut off the top. And so a lot of the money stayed right there and those glass cubes that you see when you're driving around the belway or driving out the delist toll road you see just these you know those those cubes with those inscrutable acrony it's a middleman economy yeah exactly and right and and so what what's happened in washington is just incredible that you have this place that was always that we we sort of deliberate we created it to be deliberately created to be not a between sort of just just the capital it's supposed to be this this place

that we had our sort of our merchant or glittering merchant cities already by that point, but Washington was not going to be that. It was going to be a place that that would have, you know, the government buildings to sort of administer our new federal government, but it was not supposed to be sort of a,

it was a reason we made it its own thing. It was just supposed to be this thing for the whole country that sort of represented us and did our business, our government business, and that was that. And now, but it's been transformed by two main dynamics these last few decades. The incredible growth in the influence industry, the lobbying industry, and then the incredible growth of the Homeland Security apparatus after 9-11,

where just this sprawl of contractors and large and small. And then, of course, that in turn further fueled the influence industry, because you have to pay for the influence to get the contracts. And so now you have D.C. as just this extraordinarily wealthy place with five or six of the ten richest counties in the country in the metro, D.C. area. And just all the trappings of extreme wealth. The one that I think might be my favorite is there's a restaurant in D.C. where children, when you come with your kids,

if your wealthy family come with your kids, they can pick, you know, non-alcoholic cocktail, it's off of a cocktail cart. The waiter brings by a, you know, a cocktail cart for the kids. Right. And it's like $12. Yeah, exactly. Yeah. And this is a point I think we should seize on because I think oftentimes, you know,

what's lost in this conversation about big tech, of course, and we'll spend time talking about it. Of course, the tech companies have done what they do. But also they're existing in a political system that, you know, is, I don't know, fairly corrupt and has created the economic conditions that have incentivized this bigness and allowed this bigness to happen. You know, there was an interesting thing that just reading through your book talking about how Amazon fulfillment centers are now on the land that Bethlehem Steel was, and it struck me

that we're talking about fulfillment versus production. And it's not industry. It's, you know, not U.S. industry. It's our big companies are now just shipping out products that are made. in other countries. And what, so what happened in the U.S. That made Amazon and made fulfillment become this critical employer versus production? And corollary to that, you know, the steel jobs that you write about, places like in Bethlehem, steel, you know, people were getting killed often.

You know, even one of your main characters got his arm burned off pretty much. So, so I, you know, I'd like to know how we shifted from. industry to fulfillment as like what we think of as the top u.s companies and then also like are these jobs actually that much worse than than the dangerous jobs that we're here before i just as a quick aside the the fact that we're now that these these warehouses now on the same piece of land just basically packing things are made elsewhere i was struck when i came to the one time when i visited the warehouse at sparrows point where the best steel plant used to be and there was sitting in this big kind of swampy piece of land alongside the warehouse was just this

random massive shipping container like and it sat on it you know it's almost as it says like china shipping um forget what you know which which you know shipping line that is um but it was just sitting at all by itself this massive um you know one of those enormous steel containers like straight off straight off a ship, just kind of ruined in the swamp there. It's kind of eerie. But no, I mean, the story of how, of course, there's many, many others have told the story of how we lost that manufacturing base and lost those kind of jobs.

I tell that part of the story in the book, both through what happened at Beth Steele and also what happened in the auto manufacturing sector in southwest Ohio where in the Dayton area you just had this incredible supply chain of of auto parts manufacturing Dayton was the basically the second largest auto industry town after Detroit and you had this you know all this traffic kind of going up and down the I-75 corridor from Flint all the way down through Detroit down to Dayton and then Toledo all those all these manufacturers large and small that kind of fed that supply chain and and you know there's all of course there's a lot of talk about NAFTA still

in anger about NAFTA and a lot of those jobs did move down to Mexico but but but you talk to the economists and they really, they think of anything. The effect of China joining the WTO in 2001 was even bigger in these communities. And there's been, you know, it's been well documented by guys like David Autor at MIT. Just what an incredibly devastating effect that admission of China to the WTO had on places like Dayton and just how disproportionate effect was on places. relied heavily on manufacturing and you look at the numbers of what happened in southwest Ohio and in the first decade of this century and the job losses are stunning I mean you can track it in job losses you can track it in the the reduction is simply the use of power in in Ohio

was that you could like track just how much less industrial power like electricity was being used because they simply didn't need it anymore. All these things are just shut down. And one of my, I don't get into this in the book, but I interviewed recently, a couple years ago, I interviewed that guy who's a lot of people know him from the documentary American Factory about the Chinese auto glass plant

that's now coming to the former GM plant outside Dayton. And there's just incredibly, you know, this Chinese billionaire who owns this company now in Dayton. And I interviewed him also for a documentary that I did helped out with. And he was just kind of mocking us as a country for having led our manufacturing base with her. And it was kind of laughed cackling about it.

It was an extraordinary moment in this documentary. And basically saying, look, you just, that's why we're here because you let it all go. So, you know, that brings us to the jobs themselves. I take pains in the book not to glorify that industrial work. I'd go into great detail about just how treacherous the work was. I describe a lot of these different injuries. And yet the man that I focus on, Bill Bodani,

has endured several injuries himself, and one of which basically finally leads to his retirement. it. But I do think that you talk to these men, and mostly men, of course, and you talk to them about their own experiences, their own work. And you hear from a lot of these guys still in Baltimore. They're often on the radio, you know, kind of reminiscing. And it's just really striking to hear that while they talk about how hot, dirty, and difficult, often dangerous the work was, that they still found, took incredible pride in it and found an immense value in it, both in the work itself, the fact that they were making something, they were running steel, and, and the fact that, and in a sort

of fellowship and camaraderie they felt with, with the other guys on the job. And, and so, and then, of course, in top of that, they were being paid very well for it. And, and that combination of being paid a living middle class wage of $30, $30, $40 an hour, of good benefits and having a real stay on the job and then actually making something, taking pride in what you're in the actual work you're doing, having something to show for at the end of the day, and then actually having some kind of real social fellowship. in the workplace, those are all things that are missing now in the warehouse work.

So the warehouse work is certainly less treacherous. It's physically taxing, but less treacherous. But there's just much less meaning and value to it. And there's a reason. So there's a reason why people, there's 100% turnover on the warehouses, 100% every single year. And whereas, you know, guys who spent, years working in a place like Beth Steele. And that's not an accident.

Right. And I think that this is a moment where we sort of take a step back and ask what's happening to our political system itself. You know, it seems like it's no wonder to me that lots of people in this country feel sold out by the political establishment. You look at Washington. We talked about Washington. It's because what do you say, six or ten of the wealthiest counties in the U.S.

are there. You have both, you have the, you know, Republicans' party of business. The Democrats, extremely cozy with these tech companies. Clinton signed NAFTA. You know, we got close. Yeah, the WTO deal for, for sure, revolving door between the Obama administration and these tech companies, Jay Carney, Biden, and then Obama's spokesperson going to Amazon, David Pluff, going to Uber, which just, you know, was behind Prop 22, which rolled back or prevented, you know, some serious worker rights from being granted to delivery drivers and, and, and, and, and Uber drivers and Lisa Jackson. Cheryl Samberg going to Facebook.

I forgot. I didn't mention her in the book. Yeah, who was also in the Clinton White House. And then Lisa Jackson, EPA going to Apple. I mean, unbelievable. And then there's another one we're going to talk about in a bit and wrong. But let's pause on that for a moment. But yeah, I don't, you know, I imagine if you had one of these jobs where you were working in industry making 30, 40 an hour.

And now you look at the federal government, you know, it's minimum wage is $7.25, which to me is unbelievably ridiculous in this day and age. And then, you know, you have and then you have these politicians sending trade deals. and then you have all their coronies getting rich. And it just, to me, it's unbelievable. And of course, it's going to lead to a sense of displacement among people. What do you think about that? Oh, absolutely. I mean, and of course, it plays a role in the 2016 election.

I mean, you see if you're a former, you know, working class, white working class Democrat, you see what's happened to your job, your town. and your community in Southwest Ohio or wherever it is. And then you see these dazzling cities that are now full of, to quote, Democrat. The Democrats are now the party of those dazzling places of the Washington D.C.'s and the Southern Valleys and the Seattle's and the Bostons where things are just going incredibly well, going well to almost to a fault. And, and, and you, you, it makes you angry, makes you feel alienated. It makes you, and you certainly makes you feel like that, that's no longer your party because those people, I mean, like the Jay Carney's, like, they have nothing to do with you.

And, and then, you know, they see them, they might come to your town, you know, with a candidate. As, as, you know, as the, you'll see these, these kind of hangars out come to town. I mean, I was thinking of it as, like, the fancy glasses rule. Like, you see these people coming to town with these. these stylish glasses, you know, and whether it's media or, or political people. And you're like, who are those people? I have nothing to do with them. They're like from it. They're completely different, you know, you feel as gulf between you and that. I just remember still, I always think back to watching that 2016 Democratic

Convention when, when Hillary was nominated in this, the extraordinary triumphalism around that dimension where of just all these things we'd accomplished, we, you know, Obama kind of ticking off all this, you know, we, it was, everything was going great. We, you know, we legalized same-sex marriage. We, you know, sort of broad inequality in all these ways. And, and all these, you know, these things were, things were going great in these cities. And we were back. And if you're, what it was like, I kept thinking, what's it like if you're watching this from Scrant?

What's it like if you're watching this from Dayton? And you're looking at this and you're thinking, we found out this is not this is not how things are where i am yeah and you know you mentioned this on the realignment show i'd like to get into it a little bit can we talk about the democratic coalition uh because you you mentioned it's sort of an amazon coalition in a sense right you have people in urban cities who are going to vote blue who are using amazon to get packages delivered to them and then you're going to have you know the workers in the fulfillment centers who are supposed to be their natural allies, you know, where, and the drivers, right, who are working

their asses off. And, you know, some people having to pee in bottles to get these packages. And, you know, it just strikes me that, oh, these folks are supposed to be natural political allies, but it seems like there's some tension there, something that doesn't fully connect. Absolutely. I mean, it's, it is, it does not seem like a very sustainable coalition. It seems certainly awkward. And it's, but it is essentially what the Democratic Party is now becoming. And you have, you have parties just now being incredibly strong with, with the highly educated kind of metro voter. The parties are sorted now are more and more by education. even more than by, you know, by income now,

or sort of by education levels. And as more or more, these kind of Romney Republicans have moved over to the party, you just have the Democratic Party incredibly strong with exactly the demographic that Amazon is very strong with. Amazon is popular, you know, obviously it comes to the board, but it's, but it does best with the middle of our upper no class metro consumer. Walmart still holds its own, you know,

out in the hinterland, but Amazon is just, it's just crushing it in, in the big blue cities. And, and so, um, so you have that consumer who's now, the, the, the dominant demographic and democratic party. And then alongside the, the Democratic Party still does like, you know, still still, still does have a working class base of black and brown voters, black and, you know, voters. And those, a lot of those voters populate the Amazon workforce in the cities, in the fulfillment centers and in the trucks. And so you have, that's why I call it the Amazon Coalition. You have a party made above the Amazon consumer who is just one-clicking everything, whether it's from Amazon or from food delivery or Uber or whatever. They're just

kind of gone whole hog into that kind of life and then you have the people who are who are doing the work for them the driving and the packing and and that of course that that the awkwardness of that coalition that coalition grew even more awkward this past year when when you had the consumer go even more fully into that existence and the risk of the work being done by the packers and the drivers was greater. And so during the pandemic. It was already an awkward class coalition, but now you had this real kind of awkwardness around the risk being accepted by the deliverers.

And you just wonder how long this can last. Right. So let's talk about like the people that like the end users of Amazon, you know, the people that are living that one click life as you as you call it. Yeah. Let's talk about them because is it, you know, their embrace of these services. I mean, I'm myself a member of Amazon Prime, right? I think we have more people that are members of Amazon Prime than are, you know, cable

subscribers in the U.S. right now, more than go to church. More than Amazon Prime than vote in midterm elections. Then vote in elections, right? So the folks that are that are so enthusiastically embracing the one click lifestyle is like hypocrisy where it's like I care about worker, rights, but I'm also going to use Amazon, is it suspension of disbelief? What's going on there? It seems like some sort of cognitive dissonance. Maybe you can help me understand myself a little better by answering this one. I mean, this is the, you know, this is a question

that goes beyond my book, to be honest. This is a question that's, you know, this is, this is a question for our novelist, too. This is a question for David Foster Wallace and Jonathan Franson. Like, how did the American, yes, how did the American consumer become so incredibly attached to sort of you know kind of instant gratification and cheap consumer lifestyle where we're seeing seeing the low price and the promise of rapid delivery lights something up in your in the brain I mean yeah but you've been watching it so yeah but I was saying that it's this this is you must have some thoughts on it I do have thoughts on it and but there I have to be careful I always say it because it's you know you don't want to come off um

you know, is sort of moralizing and, um, and righteous by it. So I'm always careful to, you know, say that I'm not, it's not about absolutism or boycotts or anything like that, but it is about like some kind of moderation scale. I mean, what happened this past year was just off the charts. I mean, the degree to which, the degree to which, you know, this, the one click life was embraced was just extraordinary. There were these, the numbers, their growth was off the charts. Like they were already big and they have sales then go up 40 or 50% as they did.

That, you know, that was, that was all of us in a way, like doing that. And even, you know, arguably in excess even of what was sort of kind of required by the public health edicts. The degree to which a whole lot of us decided just to completely go. whole hog that route and just without even you know just as soon as we had the permission to do it kind of that we felt that we had the epidemiological permission to do it we just with what a lackardy we embraced it and and you do see a lot of people now talking about the fact that they don't want to give it up like that they really have just you know even now as it grows less necessary that they've just really kind of become wedded to that that kind

of existence. And so yes, I don't know if it's hypocrisy or if it's just a lack of imagination, not wanting to think about the consequences at all. And it's not just the consequences of, you know, that worker and who's doing all your dirty work for you. Oh, that's a big part of it. It's also the consequences to, you know, to all, to all the, all the businesses in the place where you live, the landscape in the place where you live, the vacancies, the tax base that's being eroded by this kind of living, it's just, it's just a complete kind of blocking that all out. And this book is partly an appeal to that person to just to think a little harder more broadly and make connections.

It's all about making connections. It's about connecting our actions with consequences. And so I really, I just, I really do hope that that coming out of this moment that we are able to to somehow reengage with the world around us and not just with our shopping. I mean, yeah, I'm not here to moralize. Definitely not the goal of the show. It's not. But I also think part of the. What we want to do on this podcast is ask some of those tougher questions that people, that we do dance around because they're uncomfortable.

And this certainly seems like one of them. And the growing, and I don't blame, I mean, I think it's been clear in this conversation. I don't personally blame Amazon. You know, Amazon was made the villain, but Amazon operates in a system. And the system is governed by political choices. obviously it takes two to tango but it just just seemed that eventually this you know this stuff all ends up with politics and you know I wonder if you know you talked about how this democratic coalition isn't sustainable because you know I mean or might not be sustainable you know given

what the workers are experiencing and it does like every time I think about this I just say okay does this end in revolt in some way. Like it just doesn't seem like a very sustainable place for a society to be where you have this situation, where folks are in these grueling conditions. And they don't seem to have like a group in politics that are actually looking out for them in a meaningful way. No, but, you know, arguably we already had a revolt.

You know, it's... Yeah. no doubt but like does where you know I guess suppose that you know the revolt I think I imagine you're talking about the Trump election um I don't think that's an end point in time right this so the problem isn't solved now that now that we're past that point in history and then the next big political question it really is is in a sense whether that whether you're going to see what's going to happen we talk about the awkwardness of this unsustainable of this coalition, is it

unsustainable to the point where you actually are going to see some of these black and Latino workers who populate the warehouses in the trucks grow so resentful of the people that they're bringing this stuff to that they actually

start to move the other way and there were some signs last fall that that was starting to happen. Right, the Republican Party increased us. With Trump's doing better surprisingly well with Latino voters and even some black man. And I see just as likely as that kind of shift, I would say would be that a lot of these, those workers just kind of express their resentment by dropping out.

And not showing up to the polls. Right. Becoming just fully kind of alienated from the whole system. But that is that really, it is something that that. that Democrats need to worry about it. So is the signs that the Republicans incredibly, you know, if you think about sort of what they stand for and where they've come from, that they might be able to, to over time,

amassed some kind of a multiracial working class coalition. I mean, that's definitely after 2020, that's what they were heralding. And it is, it seems like a product of the society where, you know, we seem to have elite checking the elite. wanting, saying they want the system to change, but not really wanting the system to change. Actually, you know, I didn't expect this, but I ended up seeing your book as kind of one in a continuum of others that I've read with similar messaging. And I'm talking about winners take all by Anan Gudidas, which talks about how like, you know,

the biggest charitable organizations are like, we're going to help. And of course, it's important to give charity. But like, you know, their preference to do it, to change society through charity. keeps the system in place versus change the system. And then the meritocracy trap, which I also saw as like, we talk about a meritocracy, but education, investment in education makes a big difference and it's so disproportionate. Right. And then you, oh, and sorry, then you look at the, I just watched the college admission scandal

documentary on Netflix. And it all seems to be sort of tying into this whole thing. We're like, you know, what we're talking about here is really the American dream. Right. And it's seeming to many to, you know, there'd be cracks in it. And it's seeming like the country in some ways, I mean, obviously more even than probably almost anywhere else in the world. Great, great entrepreneurial environment here. But it's also seeming to be more of a two-class system.

Right. I don't know. I mean, obviously, like, it was like this in the past. And there was never a perfect America, but, um, but man, it's just, it just hits you in the face when you look at what's happening right now. Exactly. I know, I see those, I absolutely see the books. Those books all tied together. I, I actually participated in a, I was in a, um, kind of a workshop session for the meritocracy trap when it was, when, when Dan was, Dana was writing it. Daniel Markowitz, who wrote meritocracy trap, yeah. Yeah. And, and I see them all connected probably because it's all about, So much of it is about, you know, this new class of sort of super highly educated middle upper

middle class, mostly white liberals, not only, you know, sort of detaching in terms of just their income and their prospects, but also just physically detaching, like the extent to which we've kind of sealed ourselves off and where we live and where our kids go to school and And, you know, I talk about this in fulfillment that there's, that, that there's now much more sorting, other middle class people are now much more likely to live amongst other middle class people that used to be the case. There used to be much more of a willingness to live in more mixed income neighborhoods. And now we are, we are clustering ourselves around our own, to a storing degree.

And then you add on top of that the one-click kind of life where you don't even have to go out, to interact with people at the store or otherwise. And so you are, whatever minimal interaction you might have been once from having with people unlike yourself or is even less likely now is really is just that driver who is pulling up and maybe you acknowledge him, maybe you don't as you're sitting there at your laptop

and he's coming up the walk. And that is it now. And it's so, it's so unhealthy. Yep. Okay, I know we're running out of time. I want to end, you know, on one story about this back and forth between government and these big tech companies. And I used the word corruption earlier. And I don't use that word lightly, but it sure seems like that's what it is. And can you just close telling us the story of Obama's former head of procurement and Rung and how she went to Amazon business and basically rigged this? system to get Amazon all these big big contracts sure i mean it's just it's it's extraordinary how how blatant this this this story is um you know this this person an rung who worked a way up the the ladder in government was an incredibly competent capable um person toiling in this you know very kind of obscure world of of government procurement that the the people who who buy all

the office supplies and desks and real estate space and everything that's needed to make a government run. She started out in the Pennsylvania state government toiled there in obscurity for years under Governor Rendell. And then she came to Washington when a bomb was elected and worked a way up in the federal government to the point where she was finally, you know, just really pretty much at the top of the federal government procurement process in the White House and overseeing just billions of acquisitions and every year and, you know, very much, very admired, you know, was managing to trying to make things more efficient and reduce costs in various ways and really seen as sort of a, you know, kind of a star as much as one can be in such a kind of gray

kind of realm of government and and then all of a sudden um just like that she announced that she was leaving to go uh this is about a year before last year the obam administration she announces that she's leaving to go work for amazon um and going goes to seattle and and goes to work for exactly the um this new part of amazon that have been set up to to to get to get big government procurement contracts, to sell to the public sector at all levels of the public sector from federal down to local. And Amazon just saw this as a big new market, essentially to get people to get government officials at all levels to do one-click purchasing just the way they would at home for

their home needs to start doing all their government buying that way. well and in using her and it was especially crucial to have her there because they because they were in the midst Amazon was in the midst of basically making a move on an actual sort of lobbying move to to get the federal government to shift over to that kind of approach to buying and and did so through the was through the one of the big defense authorization bills that they were that we have every couple years to authorize our billions of spending on the military. And in one of those defense authorization bills,

there was a fight to slip in language, basically creating a new option to buy tons of stuff simply from the Amazon instead of going through sort of the usual procurement process. And she was in contact with people in the government, you know, seemingly in violation of of the rules about officials having to have a cooling off period after they leave the government before reestablishing contact with their former colleagues. And I reached, should make clear, I reached out to her, of course, for the book. I even, gosh, I emailed to her. I even wrote her at home just to make every effort to reach her, try to reach her through

the company, and never was able to speak to her about her role. But this is a huge thing for the company. And then I describe this incredible scene in El Paso where a bunch of executives at Amazon, not Enron, but some people just below her come to El Paso to basically pressure a bunch of office supply dealers in El Paso to sell through the marketplace, through the Amazon marketplace in their attempt to basically get the local governments there to. to start doing their buying through Amazon. And one of those people, actually, those executives who came to El Paso to pressure the office supply dealers was the former head of the chairman for all of King County in Seattle. So there's just all these people who have been kind of coming from government into Amazon to sort of help grow that big part of the business. So in the past, there might have been office supply companies that sold directly the government. Actually, you know, sell at a fair price.

Now Amazon is hiring, hiring procurement people from the government, basically helping them win custom-made RFPs or customer proposals to be the government's official suppliers. And then co-opting the office supply folks who used to have these contracts and taking 15% off the top, which is essentially their most. margin. Money goes to Amazon. Then these small and medium-sized businesses who depended on this stuff end up, you know, either collapsing or losing the margin that they were making. Exactly. And there's less tax. Right. To the local tax base and basically just sucks that money to Seattle. Yeah. And you wonder why the middle class and small business is struggling in the country and Amazon is a one-point-something trillion-dollar company, and it doesn't happen by X. I mean, of course, like I've wrote in my book, always day one, there's definitely some business innovation, a lot of business innovation that happens there.

But there's an uglier side to it as well, and I think it's important that you explored it, Hallie. Exactly. Okay, the book is fulfillment, winning and losing in One Click America. It's a great book. You should pick it up. I saw that you guys were advertising on Amazon, by the way. So, even you are part of, Amazon has you guys and you're in its grip as well. I ordered from them just as a test, but the book came a week late.

I was very mysterious. Hmm, I wonder what's going on there. Well, I enjoyed it. Thanks again for joining Alec. Great to talk to you about it. I wish you a lot of luck in this environment. And yeah, I want to say thank you to Nate Guatani, who's going to edit this in a very quick turnaround. Thank you, Nate. Thanks to Red Circle for hosting and selling ads. And thanks to

all of you for listening every week here Wednesdays. If this is your first time here, please subscribe. We have new conversations with insiders, tech insiders and outside agitators. And if you're a long time, listener rating goes a long way. So I would appreciate if you could do that. And yeah, and thanks again to Alec. We will see you all next Wednesday. Have a good one. And until then, wishing you well. Thank you. Thank you. Thank you.