Amazon Pulls Out of Planned New York City Campus (nytimes.com)

As expected, Amazon said on Thursday that it was canceling plans to build a corporate campus in New York City [The link may be paywalled; alternative source]. From a report: The company had planned to build a sprawling complex in Long Island City, Queens, in exchange for nearly $3 billion in state and city incentives. But the deal had run into fierce opposition from local lawmakers who criticized providing subsidies to one of the world's richest companies. Amazon said the deal would have created more than 25,000 jobs. Amazon's NYC educational investments will continue.
Amazon's statement: "After much thought and deliberation, we've decided not to move forward with our plans to build a headquarters for Amazon in Long Island City, Queens. For Amazon, the commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term. While polls show that 70% of New Yorkers support our plans and investment, a number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward with the project we and many others envisioned in Long Island City.

We are disappointed to have reached this conclusion -- we love New York, its incomparable dynamism, people, and culture -- and particularly the community of Long Island City, where we have gotten to know so many optimistic, forward-leaning community leaders, small business owners, and residents. There are currently over 5,000 Amazon employees in Brooklyn, Manhattan, and Staten Island, and we plan to continue growing these teams."

Comments

Re:Place it where they need it

[hierofalcon]

Land costs are so much less, Amazon wouldn't need 3 billion. Plus, since real estate costs are so much less the pay ongoing for employees would be lower. Granted an influx of 25,000 employees would increase city costs in many ways (schools, roads, utilities, and would temporarily spike house costs). Still, they are unlikely to come anywhere close to costs of living in NYC.

I bet it's also the new tax law effect

[blahbooboo]

I bet also they realized it was going to be even more expensive to have employees in NYC due to the new Fed tax law. Higher tax states like New York have become even more highly taxed due to the cap on the state level income tax deduction from federal taxes (SALT).

https://nypost.com/2019/02/13/...

Anti-socialists finally win one

[JoeyRox]

Conservatives hate socialism except when they're the ones receiving the wealth taken from others, which would've been the case for the billions in tax subsidies Amazon was promised in this deal. That would've come right out of the pockets of other businesses in the area who didn't get the benefit of those same tax cuts.

Re:Place it where they need it

[93 Escort Wagon]

I've always said if Amazon wants to be really beneficial and transformational, ...

Stop right there.

Like most companies, Amazon is only interested in maximizing their profit. They won't say that, of course, because their expensive PR teams tell them how stupid it would be. So they spend a few million putting together a BS spiel about being beneficial and transformational - what's a few million against three billion dollars in taxes they won't have to pay?

The real problem is - the local governments buy into the lie hook, line, and sinker. They turn around and tell people Amazon is going to create 25000 jobs, which will be filled by local people. They keep a straight face while they eloquently speak of the billions of tax dollars the local economy will be gaining due to these new positions. Of course it's in their interest to do all this, because they are politicians and need lies like this to prop up their future campaigns.

Re:Lol

[jellomizer]

The thing that bugged me is that New York City has a huge economy by itself. Those Amazon Jobs wouldn't put a real dent in the local economy. Now if they were 100+ miles in upstate, then those would be a big benefit to the local economy.

Metro NY shouldn't have to bend over backwards for Amazon for a fraction of a percent increase in its local economy. While a small town, say a post industrial town, Amazon could bring in new life.

I hoped that Amazon got a lesson from this, that even though you are a big company, don't expect everyone to bend over backwards to kiss your butt.

Re: Good government management

[jythie]

For the same billions, they could probably attract hundreds of smaller companies that would have far more impact on the city.

Re:Place it where they need it

[s122604]

I'd just say, as an (in theory at least) potential employee, place it anywhere but Chicago, California or the Northeast Corridor..

It would be nice to live in a place where a 900 square foot condo doesn't cost a half million dollars..
Austin suburbs are still relatively affordable, as is Nashville, Atlanta, Pittsburgh, and pretty much any Rust belt location.

A rust belt city doesn't have tons of money

[rsilvergun]

lying around for direct & indirect subsidies. That's what this is about. As near as I can tell NY was basically going to pay Amazon for the jobs (similar to what Foxconn did to Wisconsin). The likelihood is that Amazon would be gone as soon as the subsidies dried up.

It's like a sports stadium without a team to watch. It doesn't make sense to pay companies to bring jobs. Spend the money making your state somewhere people actually want to live and the companies will have no choice but to bring the jobs because that's where the workers are.

Now, you're right that this is leaving middle America behind. They haven't been investing in their land or their people and they're feeling it. Part of me, the bitter, angry part, wants to leave them to their fate (it's mostly their own political decisions that got them there) but the sane part of me knows that's bad juju for all. Folks usually double down on bad decisions in a crisis. Better to have the Fed move in with jobs programs like we did the last time things got this bad. That's what the "Green New Deal" is for.

Bottom line, Amazon's pushing Supply Side (aka Trickle Down) economics on NY (pay us for the jobs and the money you give us will trickle down to workers). NY was smart enough not to buy it for a change. Here's hoping the rest of the country will tell Amazon to go pound sand and they'll have to pay for the services they want and need.

Re:Lol

[lgw]

The whole HQ2 thing was a scam to begin with. Good to see NY rejecting the con. Opening 2 HQs next to Bezo's other 2 houses was so blatant, I'm amazed he thought it would fly.

Good for NYC

[rsilvergun]

I've had it with this race to the bottom where we're all falling over ourselves to see who can give the most of my tax payer dollars in direct/indirect subsidies in exchange for a handful of jobs (yes, 25,000 is a "handful" to a city the size of NY).

I have to pay for roads and schools, let Amazon chip in. Last I heard they're the most profitable company in history (unless Apple's got it this week).

Amazon has grown too large

[hedge00]

This is putting the cart before the horse. Corporations exist at the benevolence of society not the other way around. Amazon Corp uses strong arm tactics to wheedle their way out of paying the taxes that they exist to generate, because they are big enough to play municipal governments against each other. Time to break them up.

Re: Good government management

[ShanghaiBill]

For the same billions, they could probably attract hundreds of smaller companies that would have far more impact on the city.

Exactly. What NYC should be doing is improving their overall friendliness to commerce. Better transportation infrastructure, fewer restrictions on the construction of housing, fewer petty regulations, and a more streamlined bureaucracy. It should not take six months and 17 forms to open a taco stand, and nobody should need a license to paint fingernails.

Many growth friendly policy changes would cost nothing. Others, such as infrastructure improvements, would be expensive, but are badly needed, and will benefit the city for many decades to come.

Local gov'ts don't buy the line

[rsilvergun]

but their voters, who are desperate for jobs, do. Take the gig economy & temp work out of the equation and we're pushing 9% unemployment. Meanwhile the politicians figure they'll be out of office by the time the bonds used to pay for the subsidies come due.

It's just another example of the rich plundering the commons. Robert Reich calls it a Switcheroo. It's older than that though. We used to say "Privatize the profits and Socialize the losses".

New Metric required

[Gorkamecha]

Can we use a new metric in place of Jobs?
Jobs might have meant something back in the day - but the word has been mangled so completely it could mean "well paying blue collar work" or it could be "third shift, part time apprentices who have to pay for their own uniforms"

How about instead we expect a "wealth" metric like "We plan to employ X million dollars of employees"?

...they won't of course. They don't want us regular plebs being able to do the math in our heads.
"Wait....we we're giving you 1 billion/y in tax breaks, and you're only bringing in 1/2 billion/yr in wealth......"