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| The wise pundit has weighed in |
After a lengthy sweepstakes-like process,
Amazon ended its race for HQ2, claiming its decisions weren’t swayed
by the more than $3 billion in tax breaks and other sweeteners offered by New York and Virginia — because the deals were “relatively modest” compared to what else was put on the table. “If you look at some of the proposals that were put forward by cities that released them publicly, you can find out very quickly that incentives did not drive this process for us,” Jay Carney of Amazon
said Tuesday on CNBC. Those areas include Montgomery County in Maryland, which offered $8.5 billion, and Newark, New Jersey’s proposal of $7 billion.
The HQ2 decision has been slammed by politicos and pundits from both sides. From
NY Post:
Fox News host Tucker Carlson asked on his most recent show: “Jeff Bezos, who is the world’s richest man, will receive more than $2 billion in subsidies from you, the taxpayer,” he said. “Alexandria Ocasio-Cortez had this to say: ‘Amazon
is a billion-dollar company. The idea it will receive hundreds of
millions of dollars in tax rates at a time when a subway is crumbling in
our communities need more investment, not less, is extremely concerning
to residents here,’” Carlson continued. “I hate to admit it, but Ocasio-Cortez has a very good
point. It’s hard to argue with the internal logic, the richest man in
the world [getting] taxpayer subsidies. How does that
work?” the conservative firebrand added, referring to Amazon chief Jeff
Bezos, who has a net worth that tops $150 billion, making him the
richest man in America.
Veronique de Rugy, a senior research fellow at the Mercatus Center at
George Mason University, also rebuked the massive tax breaks in a piece in the National Review and criticized fellow conservatives, some of whom mocked the 29-year-old Ocasio-Cortez for opposing the deal. “I can’t believe I’m saying this, but Ocasio-Cortez is mostly correct
on this matter, and her conservative critics are wrong. Handouts like
this to Amazon and other prominent companies are appalling in their
cronyism, pure and simple,” she wrote. [...] She argued that Amazon was seeking locations with skilled workforces
and quality educational options — and that tax breaks were largely an
afterthought to those factors. “In other words, Amazon would have likely made the same decision with
or without subsidies. It also explains why no amount of subsidies can
drag a company to a place that isn’t economically vibrant or that is in
the middle of nowhere,” de Rugy wrote. “But face it: Amazon was never going to move to, say, Opelika, Ala.,
or Marfa, Texas, no matter how gargantuan the promised tax breaks
there.”
Bre Payton, a writer for the conservative website The Federalist, also slammed the deal.
“The democratic socialist from the Bronx is right to be outraged
about the corporate welfare that threatens to price her constituents out
of their own housing market,” she wrote Wednesday.
Amazon announced Monday it had chosen Long Island City, Queens —
where protesters gathered Wednesday to denounce the deal — and
Arlington, Va., as the sites for a new split headquarters. Ocasio-Cortez had said on Twitter that the people she represents have expressed “outrage” over the tax breaks, while arguing the cash could also go for student loan forgiveness.
Even the moniker "HQ2" is considered
a sham, bait-and-switch, a PR stunt: Amazon never really intended to make such massive investment as the name implied,
they just wanted to open a branch office. One pundit even
predicted back in January that Amazon would pick more than one winner. Moreover, numerous cities are understood to have shared proprietary data about their areas and plans, in addition to offering tax incentives. “A key concept for understanding
how Amazon operates is leverage. By running the search as a
nationwide competition and receiving proposals from hundreds of cities,
Amazon now has a database of information that gives it a further
competitive advantage over rivals, as it’ll use this research to inform
future expansion, and Amazon extracted the best deal through exercising
its bargaining power over cities.” says Lina Khan of the Columbia Law School.
Why the outrage? Because Amazon is set to reinforce economic system that is
increasing inequality, monopoly power, and political polarization in one fell swoop. The company could have easily chosen mid-sized urban areas with dynamic tech sectors, like say Pittsburgh, Raleigh, or Indianapolis. Matt Yglesias of Vox explains further:
...while locating large pools of high-salary
white collar positions in the New York and DC metro areas makes sense for Amazon, it doesn’t actually make that much sense for either
greater New York City or greater Washington. Amazon’s presence will tend
to exacerbate those cities’ crises of housing affordability and
overburdened transportation infrastructure. And it makes no sense at all for the USA, which urgently needs more economic opportunity in dozens of
other metro areas that have a different set of problems. America
needs to find a way to do better than this. Being the home to a very
large share of the world’s most dynamic high tech companies is an
incredible source of national strength, but in practical terms it does
not benefit most Americans. With better policy it could.
Don't forget that the decision is very often
not-so-subtly influenced by where the boss
has a swanky new home and likes to spend time in.
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| Bezos' DC-area mansion |
