Paul Krugman has an op-ed today where he argues Amazon is abusing its power:
Which brings us back to the key question. Don’t tell me that Amazon is giving consumers what they want, or that it has earned its position. What matters is whether it has too much power, and is abusing that power. Well, it does, and it is.
Amazon is attempting to negotiate lower prices from the publisher Hachette and is slowing down sales of Hachette books on amazon.com in an attempt to force their hand. This is the main evidence.
But this kind of bargaining leads to lower prices for consumers not higher. It is akin to the argument for reducing double marginalization via veritical integration. In fact, here is Krugman in 2000 explaining why breaking up Microsoft into Windows and Office is a bad idea:
In the last few days the Justice Department, outraged by the…
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Utopia, you are standing in it! 
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