New York City 1, Amazon 0
Remember back when states and cities were prostrating themselves before Amazon in hopes of landing a new headquarters? Lots of people, not all of them Republicans, castigated Alexandria Ocasio-Cortez and other anti-corporatists for passing on the promise of jobs in exchange for multi-billions in tax breaks. Those who were against the giveaway cited all sorts of practical reasons for rejecting it, but let’s keep it simple — one of the world’s richest corporations (one that would never have survived infancy if it hadn’t stiffed the individual states on several billion dollars in sales taxes) didn’t need the public paying for its headquarters.
Guess who was right?
Here’s a hint: Amazon announced it has leased 335,000 square feet of existing office space in the Hudson Yards complex on the west side of Midtown Manhattan, enough for more than 1,500 employees. Jeff Bezos will have to pay for his own helipad, and Long Island City won’t be transformed beyond recognition.
AOC’s critics also decried the supposed message their rejection of Amazon sent to the wider business world — New York City was hostile to business in general.
Wrong again. That same Bloomberg article linked above states that Facebook announced that it was leasing more than 1.5 million square feet at Hudson Yards last month, while Google has kicked off a major expansion in Manhattan.
The lesson: Corporations don’t base these decisions on who promises to tax them the least. They make these decisions based on considerations like geography and the qualify of the work force, then romance politicians in the targeted cities to see how much they can get out of them.
Why do politicians play along? It’s not stupidity. Ask yourself this: What gives a politician better PR — a company coming to town of its own volition, or a company coming to town because said politician was so good at wooing it?
By allowing politicians to give away taxpayer money at their discretion, we are turning them into kingmakers. There’s risk involved — Bloom and Fisker were Jack Markell’s undoing — but in normal economic times these misses, like faulty predictions, swirl down the memory hole.
It’s understandable that a backwater like downstate Delaware hands out such tax breaks — the geography of transportation has always hampered industrial development there, so lures are needed. But New York City is a desirable enough corporate destination that it shouldn’t prostitute itself to attract businesses that already have lots of compelling reasons to locate there.
In short, Alexandria Ocasio-Cortez and progressives were right and the corporate-humping wing of the party was wrong. Again.
And so AOC did prevail as the “centrists” were proven to be wrong, and decisively at that. Found this to be extra sweet, pity we have no equivalent of AOC in Delaware as we could really use one, two or a dozen.
Don’t we though? Or, more precisely, won’t we?
I can think of two right off the top of my head.
I’ve seen the top of your head. That’s not where they are.
Its not the same deal. 1,500 jobs is not 25,000. Delaware has more Amazon workers than that. This is spin. Nobody ever said that Amazon was never going to have operations in NY. They still lost out on a major deal and this 1,500 employees doesn’t change that.
With that being said, that does not mean that your position about what really attracts jobs and not throwing money at companies is incorrect. I totally agree with that. I just think we can make that case without using this random expansion as proof of something other than the mundane fact that largest company in the world is adding 1500 jobs to the most popular city in the world.
I think if you tote up the cost-benefit analysis, this is a better deal for the existing residents of the city, as nobody will be displaced under this deal and no tax dollars will go to undeserving corporations.
To be blunt, motherfucker not only pays no federal taxes already, he gets subsidies, which shows the tax code is FUBAR. The last thing he needs is the opportunity to gouge them at the state level as well.
My main point is about how governments should negotiate. Amazon needs New York more than New York needs Amazon, and politicians have a lot more to gain than the public does from these sweetheart deals.
Indeed
Hey, we don’t need no stinking lures to attract rich white trash to the eastern Sussex!
Really? What do you call the tens of millions of dollars we spend on sand?
The state budgets 10mil a year for farmland preservation which mostly goes to purchasing land from and for farmers. Sussex doesn’t even pay for their own policing. Its amazing that the most conservative county is on welfare
Not really surprising. The red states all take in more than they pay.
It may not be in my lifetime but AOC just may be the first Hispanic POTUS but not necessarily the first female president.
Agreed. Except for the “in my lifetime” part.
It never makes the evening news, but radical change is happening every day.
Was in Seatlle this Summer asked why no Walmart? I was told they are preditory, don’t pay a living wage and put their employees on government assistance. Seniors ride very clean and reliable transportation for $1 a day. They have a gentryfication progame going on though but people are getting close to a 1/2 million for their home.