Amazon said it is buying Whole Foods Market in a deal valued at about $13.7 billion, including debt. (June 16, 2017) (Sign up for our free video newsletter here http://bit.ly/2n6VKPR)
The recently announced sale of Whole Foods to Amazon is a betrayal of the grocer's touted principles. Whole Foods is supposedly committed to adhering to values of the "triple bottom line" — also known as the "3Ps": people, planet and profit — while Amazon's philosophy is only their financial bottom line, or the third "P," profit.
The 3Ps involve the understanding that businesses' duty is to serve society — which includes workers, customers and communities — along with the ecosystem, and to be profitable. The purpose of traditional corporations is simply to make money; exploitation, contamination and increasing economic inequality often result.
Amazon is a powerful force in the elimination of jobs, replacing human beings with robotics and IT. It is the reason local, job-producing bookstores have closed, and now, many job-creating retail stores also are closing as Amazon expands. As a few get richer — Jeff Bezos, Amazon's CEO and Washington Post, owner tops the list — many more of us are getting poorer. To make things worse, many who are benefiting from this increasing wealth are reinvesting it politically to achieve tax breaks for the ultra-rich at the expense of the rest of us.
What is truly disturbing is that Whole Foods CEO John Mackey appears to lack an ethical sense of stewardship toward his employees and customers. Under Mr. Mackey's guidance, Whole Foods incessantly promoted itself as a triple bottom line company aimed at attracting and keeping loyal, socially conscious customers with 3P values. Its stock price and market share soared. The firm methodically bought up local, often cooperatively owned, stores around the country, leveraging Whole Foods economies of scale and scope to create its own national health food chain. Then, when the time was right — ironically at the height of cynicism about politics and capitalism in America — Mr. Mackey raided his own company to sell out to Amazon, which just keeps getting bigger.
Historically, there were antitrust laws protecting the public against this type of disruptive monopolization. It was understood that one person's expense is another person's income, and if the wealth generated in businesses is spent in local communities it multiplies, creating sources of wealth and income for others. Our immigrant forefathers understood this value when they spent their earnings in their own communities, like Baltimore's Little Italy and Washington D.C.'s Chinatown. Therein lies hope, and it is found in the maxim: Think globally, act locally. Imagine the world consisting of a globally quilted pattern of local economies, keeping wealth in our communities and fairly allocating the rewards to its working residents.
If Whole Foods were a true adherent to the first P — people — it would have offered its employees the opportunity to buy the business. Employee-owned enterprises generate an economic multiplier effect, with the worker/owners spending much of their business earnings in their local communities. They also tend to be greener and fairer than corporations like Whole Foods and Amazon because employee-owners live where they work and care about their neighborhoods. The temptations to make more money by polluting or eliminating jobs are as unacceptable as being reckless with the businesses' finances.
Employee-owned businesses are already an important part of the American economy, with 14 million workers and 7,000 companies, including Publix Supermarkets, which has more than 187,000 employees and $34 billion in annual revenue. Compared to traditional corporations, such employee-owned firms achieve higher productivity with increased sales. They also offer better employment opportunities, retain jobs in state (and avoid relocating out of state), sustain the state tax base through employee and corporate income tax, and save costs on unemployment insurance and other state benefit programs.
Additionally, a study released last month shows that among younger workers engaged as employee-owners, 92 percent enjoy higher median household wealth and 53 percent have longer median job tenure than non-employee-owners.
At a time of intense polarization, increasing worker ownership is supported across the political spectrum, with nearly 70 percent of Americans for it.
Employee-owned enterprises honor people and planet while being profitable. Meanwhile, Amazon forms monopolies throughout numerous sectors, eliminating jobs by the millions. If all the jobs are gone, where will we get the disposable income to buy things? What kind of society are we leaving for our children? This acquisition should be scuttled with Whole Foods either laying the groundwork to sell to its employees or to the largest and most successful employee-owned supermarket chain in the United States: Publix.
Christopher Croft (firstname.lastname@example.org) is a University of Baltimore research fellow and adjunct professor. He is also vice chair of Maryland Sierra Club's Greater Baltimore Group and chair of the Labor and Economic Justice program.