Big Box Panic

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In 1927 at least 10 state legislatures proposed anti-chain legislation. In 1928 the Supreme Court struck down a Pennsylvania anti-chain ordinance that required drugstores to be owned by pharmacists, not corporations. The court ruled that the law’s stipulation of who could own a business was unconstitutional.

In 1938 Representative Wright Patman (D-Texas) introduced legislation to tax any chains with 10 or more outlets. Its provisions, one industry observer noted, “were drastic enough to have put many a chain out of business.” The bill never made it out of committee, but the stage was set for future legislative attacks on the chain system.

Today’s independent booksellers and their supporters fret about an Axis of Evil consisting of Amazon, Borders, and Barnes & Noble—and with good reason. Independent bookstores account for just 15 percent of the market, down from 80 percent in the early 1970s. The American Booksellers Association (ABA), which represents nearly 2,000 independent stores, filed suit against publishers’ “unfair” use of volume discounting in 1994 (the case was settled out of court) and again in 1998 against Barnes & Noble and Borders (the ABA dropped the suit).

But the ABA too could assuage its fears by looking to historical precedent, when both publishers and smaller shops attacked chain discounters with blind fury. As far back as 1872, Publishers Weekly argued that publishing houses selling directly to consumers would sound the death knell of the local bookstore.

From 1900 through the 1930s, the American Publishers’ Association and R.H. Macy’s department store repeatedly clashed in court over Macy’s practice of selling books below cost. In 1934 the publishing industry adopted a “book code,” part of the “codes of fair competition” required under the National Industrial Recovery Act, that disallowed discounting of books until two years after their release. In 1935 the U.S. Supreme Court ruled the codes unconstitutional. The author of a 1930 Carnegie Corporation report complained that bookselling had inexorably changed—it had become a business: “The old-fashioned bookstore was a charming place, but charm alone will not solve the problem of modern book distribution. . . . Hard though it may be to face the fact, the bookstore of today cannot be primarily a place for those who revere books as things-in-themselves.” An ABA representa­tive later complained to a Senate committee that “non-book-minded merchants” were killing the industry and “price-cutting, unless stopped, will ultimately eliminate the personal bookstore from the national scene and in turn will have a serious effect on the quality of our national literary production.”

This, of course, has yet to happen. Chain stores are still the undisputed kings of bookselling, but their sales figures have remained flat in recent years. Meanwhile, the ABA announced that in 2004 independent bookstores’ “sales increased, in terms of both dollars and number of units sold, capping a three-year period of sustained growth,” citing an Ipsos BookTrends study. In 2004 an ABA spokesman told the Wall Street Journal, “Even though there are fewer stores, the survivors are doing better.” As for our country’s literary production, 2005 saw 172,000 books published in the United States, a dramatic increase over the 39,000 released in 1975.

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