Will Bezos' Washington Post be a mouthpiece?

Amazon's ranking among the country's highest spending lobby groups could create ethical conflicts

By Jonathan D. Salant
Published August 6, 2013 10:00PM (EDT)

Aug. 6 (Bloomberg) -- Amazon.com Inc., whose founder Jeff Bezos is purchasing the Washington Post, ranks among the biggest spenders among high-technology companies seeking to influence the work of the federal government.

Former U.S. Senators Trent Lott, a Mississippi Republican, and John Breaux, a Louisiana Democrat, are among those working for Seattle-based Amazon, which spent $1.7 million on lobbying from January through June, ninth highest among high-tech companies, according to the Center for Responsive Politics, a Washington-based research group that tracks lobbying.

The company weighed in on issues with Congress, the Department of Commerce and the Federal Trade Commission on matters such as Internet sales taxes and privacy, patent laws, cybersecurity and online wine sales, Senate filings show.

“They have a huge number of issues before the federal government and now he’s bought the hometown paper for covering those politicians,” said Bill Allison, editorial director for the Sunlight Foundation, a Washington-based watchdog group. “There’s always a concern you’re going to have a conflict when you have wealthy publisher. Given all of Amazon’s issues, it’s hard to see where Bezos won’t have a conflict.”

'Competing Loyalties'

Ethics expert Bob Steele agrees.

“There are certainly competing loyalties,” said Steele, director of the Janet Prindle Institute for Ethics at DePauw University in Greencastle, Indiana. “If he handles it very well, it’s possible to manage those competing loyalties, but it’s also possible for competing loyalties to turn into conflicts of interest that could erode the integrity of his journalistic obligations.”

Like other high-tech companies, Amazon has increased its lobbying spending. The company’s 2013 totals for the first six months of the year are 31 percent higher than the $1.3 million spent during the same period a year earlier. In 2000, when the company first reported it was lobbying the federal government, it spent $246,000 during the first six months.

Amazon’s team of lobbyists also includes former Assistant Treasury Secretary Jonathan Talisman, who served in the Clinton administration; Elizabeth Frazee, former aide to House Judiciary Committee Chairman Bob Goodlatte, a Virginia Republican; and Holly Fechner, former counsel to the Senate Health, Education, Labor and Pensions Committee.

Bezos, CEO of Amazon, is purchasing the Post on his own, paying $250 million to the Washington Post Co., which has been held by the family of Post CEO Donald Graham since 1933.

Issues Involved

Amazon, the largest Internet-based retailer, is supporting legislation that would allow states to require companies selling products online to collect sales taxes. Current law requires such taxes to be collected only when the Internet company has a physical presence in the state.

As it builds more facilities to speed delivery and therefore becomes subject to more state tax collections under current law, Amazon has aligned itself with brick-and-mortar giants such as Wal-Mart Stores Inc., opposing other online marketplaces such as Ebay Inc.

The Post published an editorial on April 23 supporting a Senate measure allowing states to collect sales taxes from out- of-state vendors. “This will level the playing field for stores that have a physical presence, which are already charging tax on all local purchases,” the editoral board wrote.

Digital Matters

The company is also a member of the Internet Association trade group that has urged the White House to exempt Internet services from new cybersecurity rules. The group acted after President Barack Obama in February called for new computer security standards in areas such as telecommunications, pipelines and power grids.

Amazon also is part of a Digital Due Process coalition seeking changes to privacy laws to make it harder for the government to gain access to e-mails and digital documents. In addition to companies such as Google Inc. and AT&T Inc., the coalition includes the American Civil Liberties Union. It’s seeking to require the government to obtain a search warrant to get online documents.

In July, the company sued the federal government after the U.S. Government Accountability Office recommended that the bidding process for cloud-computing services be reopened after Amazon initially had won a $600 million contract.

Political Contributions

Amazon’s political action committee contributed $55,000 from January through June, more than double the $23,500 in donations it made during the same period two years earlier, Federal Election Commission reports show.

Bezos’ only personal campaign contribution from 2009 to 2013 was the maximum $4,800 to Senator Patty Murray, a Democrat from Washington state, where he lives and his company is located. He also gave $5,000 a year to Amazon’s PAC.

Bezos must consider the reputation of the Post going forward as he acquires a newspaper at the heart of reporting on and editorializing about Washington’s issues. Kelly McBride, an ethics expert at the Poynter Institute, a St. Petersburg, Florida-based journalism training organization, says Bezos would undercut the value of his purchase if he used the Post to advocate for his business interests.

“He will have to create -- and I have no doubt that he will -- a standard of independence and transparency in his newsroom,” McBride said. “It doesn’t make any business sense for it to become a mouthpiece. It makes business sense to do the right thing.”

--Editors: Mark Silva, Jeanne Cummings

To contact the reporter on this story: Jonathan D. Salant in Washington at jsalant@bloomberg.net.

To contact the editor responsible for this story: Jeanne Cummings at jcummings21@bloomberg.net.

Jonathan D. Salant

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