◼ TECHNOLOGY Bloomberg Businessweek November 25, 201921PHOTO ILLUSTRATION BY 731; PHOTOS: ALAMY (1); BLOOMBERG (2); GETTY IMAGES (1). *THROUGH SEPT. 30; EXCLUDES TRADE GROUPS. DATA: CENTER FOR
RESPONSIVEPOLITICSANALYSISOFSENATEOFFICEOFPUBLICRECORDSFIGURESAmazon.comInc.is an$870billioncompanyaccus-
tomedtowinning—andit doesn’tlosequietly.The
companyonNov. 14 saidit plannedtolegallyprotest
theU.S.DepartmentofDefense’sdecisiontoaward
MicrosoftCorp.its$10billioncloudcontracttomod-
ernizea largeswathofthePentagon’stechnology.
MicrosoftandAmazonhadbeenpartofa fiercebat-
tleforthecontractthathadattimesinthepasttwo
yearsalsoincludedGoogle,Oracle,andIBM.
It’seasytoseewhyAmazonmighthaveassumed
it hadthecontractlockedup.Thecompanyhad
beenseenassucha favoritethattheDefense
Departmentwasfacinga preemptiveOracleCorp.
lawsuitforsettingupa processthattheothercom-
panyclaimedonlyAmazoncouldwin.Andthe
resultsdon’treflecta lackofresourcesoraction.
Altogether,Amazonspent$4million on federal lob-
bying last quarter, the most it has ever spent in a
single three-month span. Last year it lobbied more
government entities than any other tech company.
In New York City this past winter, Amazon scut-
tled its plans to build a massive campus just east
of Manhattan after encountering greater local
opposition than it had expected. In its hometown
of Seattle this fall, the company’s efforts to elect
a more tax-averse city council backfired, helping
more left-leaning candidates win. (Amazon has said
it doesn’t consider the New York pullout a defeat
but can’t contest that most of its preferred Seattle
City Council candidates lost their races.)
As Democrats and Republicans begin to talk
seriously about possible antitrust actions against
Amazon and other big tech companies, there’s
added urgency for the online retailer to learn the
lessons of these high-profile setbacks. One problem
in all three cases was a lack of a coherent lobbying
strategy, according to interviews with more than a
dozen current and former Amazon employees and
lobbyists, all of whom spoke on condition of ano-
nymity for fear of reprisal. Amazon’s public policy
chief, Jay Carney, and his deputy, Brian Huseman,
declined to comment for this story.
Unlike with the Pentagon, where Amazon’s cloud
division had a separate team doing a lot of the pitch-
ing, Carney and Huseman were front and center
in New York. Amazon’s deal there seemed to be a
fait accompli when it was announced around this
time last year. In exchange for as many as 40,000
jobs, Governor Andrew Cuomo said, New York state
and city officials had promised Amazon as much as
$3 billion in tax incentives. But the governor and
New York City Mayor Bill de Blasio hadn’t discussed
those terms with most other public officials, and
many weren’t happy with the math—some $75,000
in incentives per job. New Yorkers proved evenangrier than expected about the prospect of giving
billionsofdollarsintaxbreakstoa companyrunby
theworld’srichestman.
CuomoanddeBlasio proved unable to speed
the deal past the relevant legislative signoffs the
way they’d promised Amazon. Facing a tide of neg-
ative public opinion and more stringent terms, the
company chose to abandon the arrangement alto-
gether and shift many of its planned New York
resources elsewhere instead.
“Can everyday people come together and effec-
tively organize against creeping overreach of one
of the world’s biggest corporations? Yes, they can,”
New York Democratic Representative Alexandria
Ocasio-Cortez wrote on Twitter in February,
after Amazon changed its plans. It’s common for
Amazon’s leadership to ask people involved in
unsuccessful programs to write a postmortem
known as a “Cause of Error,” analyzing what went
wrong. Four people familiar with the matter say
that after the company abandoned its plans for
New York, no such memo was circulated.
Amazon’s failure to shift the balance of Seattle’s
nine-person City Council rightward was also an
unexpected development. The company had
been trying to put friendlier faces on the council to
short-circuit efforts to raise its local tax burden and
compelit tohelpwithSeattle’saffordablehousing
crisis.Amazonneededtopickuponlyoneseat,
andit spent$1.5million overall, a huge sum for
Seattle’s City Council elections. To lead its efforts,
Amazon hired Guy Palumbo, a dog kennel owner
who’d sponsored Amazon-friendly legislation when
he was a Washington state senator. His prime target
was incumbent Kshama Sawant, an economist and
member of the Socialist Alternative Party.
Against Sawant, Palumbo made a show of back-
ing Egan Orion, who runs the Broadway Business
Improvement Area, a local business lobby, as well
as PrideFest, which produces the annual Seattle
Pride Festival. Sawant campaigned directly on
Amazon’s attempts to bring her down. She’d won
her 2015 race handily but this time around on elec-
tion night appeared set to lose. Once the absentee
ballots had been counted, however, the socialist
candidate won after all. In a YouTube video pub-
lished after the election, Orion said Amazon had
ruined his chances with its money. “Our closing
arguments were completely subsumed,” he said in
the video. “It made the election not about the oppo-
nent’s record and policies, but about Amazon.”
The Pentagon contract appears to be the most
costly loss—and a harbinger of things to come.
Amazon founder Jeff Bezos is one of President
Donald Trump’s favorite punching bags, and● Top U.S. corporate
lobbyists,by 2019
spending*
◼Internetindustry
◼Aerospace/defense
industry
◼ Other
AmazonFacebookNorthrop GrummanUnited TechnologiesBoeingAT&TLockheed MartinComcastAlphabet$12.4m12.311.010.510.410.39.99.79.7