The billionaire and the bully: Trump's strong-arm phone call with Amazon's Bezos

The Age

30-04-2025

Such is Trump and his administration's sensitivity to any measure of perceived criticism – even from a recent recruit to the Trump billionaire fanboy club – and a person whose company donated $US1 million ($1.6 million) to the president's inauguration fund.
It is becoming increasingly clear that relationships with Trump only flow one way.
We have come a long way since Bezos joked in 2015 that he wanted to blast Trump into space on the billionaire's Blue Origin rocket (with the implication that he would stay there), and inspired the popular hashtag #sendDonaldtoSpace.
The same Bezos who in 2016 accused Trump of using rhetoric that 'erodes our democracy around the edges'.
Amazon's rationale for injecting pricing transparency is kind of understandable – particularly because it was the division called Amazon Haul that was floating the idea. That's the company's ultra-cheap business that sells mainly Chinese imported goods and that skirted duties using the de minimis loophole that allowed goods under $US800 to land levy-free.
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Last week, Trump closed it so these cheap items could now be subject to a 145 per cent duty. One of Amazon Haul's major competitors, Temu, has already begun detailing to customers the additional costs that the levies will create. Temu is owned by the Chinese e-commerce company PDD Holdings, so outing Trump's tariff as responsible for increased prices is a risk-free strategy.
However, despite the fact that price transparency in general should be considered best practice for most businesses, for the consumer, breaking down the component parts of how the final price is determined, doesn't alter how much they have to pay.
(It's like those annoying Australian businesses that quote on pre-GST and GST inclusive basis.)
Trump, whose public popularity is waning in the polls, is incredibly sensitive to criticism that his strategy to Make America Great Again is responsible for a cost of living crisis.
But expecting businesses to absorb the cost of tariffs, rather than pass them through to consumers falls within the realms of fantasy.
We could receive another chapter on how this will play out for Amazon when it reports its first quarter earnings on Thursday (US time).
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It is expected to produce a robust increase in earnings during the period.
But it will be the commentary on outlook that will be closely watched by Wall Street, which is now becoming very familiar with a new-found reticence from major companies to predict profits in what they are calling an unclear macroeconomic environment.
When Trump flaps his wings the Amazon effect feels like a global earthquake.