Re:Amazon’s HQ2 Spectacle Should Be Illegal
by PeterisP on Tuesday November 13, 2018 @04:55PM
(#18445278)
From the perspective of the whole country, perhaps we do want to reduce municipal competition and outright prohibit giving expensive handouts to bribe companies to pick their location.
From the perspective of a city, giving $x so that the HQ gets built there instead of some other city might make sense.
From the perspective of the whole nation, the notion of handing out large amounts of money to gain taxes in location A and lose taxes in location B is clearly ridiculous - let the company pick whatever city is most competitive without the handouts, and if some other city wants that HQ, well, they need to provide better services, not just a discount (which essentially is a loss for the combined coffer of all the governments), unless the gov't "one level up" has considered that it's better for national interests that this area needs to be subsidized above others.
For any single city it may make sense to underbid other cities, but for all cities together it makes sense to cooperate/collude so that underbidding doesn't happen.
From the perspective of a city, giving $x so that the HQ gets built there instead of some other city might make sense.
From the perspective of the whole nation, the notion of handing out large amounts of money to gain taxes in location A and lose taxes in location B is clearly ridiculous - let the company pick whatever city is most competitive without the handouts, and if some other city wants that HQ, well, they need to provide better services, not just a discount (which essentially is a loss for the combined coffer of all the governments), unless the gov't "one level up" has considered that it's better for national interests that this area needs to be subsidized above others.
For any single city it may make sense to underbid other cities, but for all cities together it makes sense to cooperate/collude so that underbidding doesn't happen.