New York City doesn't have a problem attracting jobs. Like not even a little bit. The idea that this is actually incremental revenue for the city is extremely debatable.
New York City is a really big place. Midtown is the largest central business district in the country, and Lower Manhattan is the third largest, after Chicago. There are 1,700,000 jobs in Manhattan alone and 3,900,000 in New York City. We're supposed to all bow down before a sixth of a percent change, spread out over 5-10 years? Really?
There are single buildings in New York City that employ as many as 25,000 people. Back when the twin towers were around they contained 55,000 employees between them.
JP Morgan Chase is putting about 15,000 employees in their new HQ building, without a breathless 13 months of coverage. This shit happens all the time. You could pick any number of random single city blocks in Manhattan with way over 25,000 jobs.
Amazon needs New York way more than New York needs Amazon. It's the global center of media, fashion, advertising, finance, and many other categories of Amazon's business.
This giveaway is a goddamm travesty. How about instead, Cuomo gives me and any other startup founder who's been in Brooklyn or Queens for decades $48,000 for every job we've created, and we tell Amazon to go fuck themselves.
It absolutely would've been smarter for amazon to remain in midtown like they currently are since it would be much easier to recruit from the suburbs many existing tech workers live in, but they would've lost over a billion of the incentive dollars they got in the process.
Wouldn't it be nice if your options for working in tech didn't consist of a handful of large banks and hedge funds?
This potentially puts NYC on top for retail again. I think incentives and payments for this purpose is a meh idea, it if you’re going to do it, bet on a winner.
The beauty of NYC is that it is not singularly focused like SF is. Media, Fashion, Finance, Tech all call NYC their home.
I think most of the hate is fueled by emotional anger at the rich due to increasing inequality in the USA, even though this investment in NYC is a positive for it when you look at it rationally.
He's saying the tax breaks provide create no gain for the city, but he's not disputing they're valuable to Amazon.
They're also not valuable to taxpayers, who are being forced to subsidize one company without the opportunity to voice their opinion a priori.
Finally, there's the incremental point that countless other entrepreneurs are not enjoying these same benefits. Not the biggest issue with it, but an important one nonetheless.
Why don't you use your leverage as a job creator to go to a town and get similar benefits since clearly you will bring the same level of benefits to that town? Or do you recognize your lack of mobility and limited investment in your town may result in a less favorable negotiating position. It's like wondering why a used car dealer gave a better deal to someone w/ a better trade in.
So true. The rent in NYC is already very high. What kind of lifestyle can a blue collar worker afford in NYC? Obviously the only winners here are corrupt politicians and greedy Amazon execs. They should all be jailed.
You can dislike tax incentives if you want to, but the hyperbole is so over the top it becomes radical, divisive, noise.
We need less of this in these discussions.
Calling for a blanket incarceration of legislators and Amazon executives is not.
Amazon and Google are not regular employers: your startup pays outlets in taxes and mooches off infrastructure. The big companies find that with real profits.
Finally, $48k/employee is peanuts to a big city startup, and typically that kind of money is available from accelerator/etc programs.
As it happens I don't have a Silicon Valley venture backed profitless startup, I have a company that gets paid money to do work and makes a healthy profit. I've paid very considerable taxes in NYC for 20 years.
Now, literally, they are handing them to Jeff Bezos in exchange for nothing. That area of LIC would just be something else instead. We don't need these guys to bring "talent" this is literally New York City, a giant magnet that has drawn the most talented people on the planet for at least a hundred years.
Cuomo is an obvious crook and has been since conception, and this deal sucks. I see no reason not to point that out.
This is a shocking display. What they are calling a government-private partnership is nothing of the sort. It's a public subsidy to Amazon. The New York Times reported $5 billion in this project will be invested by Amazon. $5.5 billion dollars will be invested by New York and Virginia. That is a subsidy of over 50% of the cost of this project. We the taxpayers will be either paying higher taxes to fund this private company, among the richest in the world, or, if we don't get our taxes raised, the government will deliver fewer services to us because it has given this enormous subsidy to a company. $5 billion from Virginia and New York where Mr. Bezos, the owner of Amazon, is himself the owner of $160 billion. He didn't need it, the company doesn't need it. We are being asked to subsidize. All of the profits will go to the private companies and their shareholders. We, the public, will be funding more than half of this project. Shame is what Mr. DeBlasio ought to feel rather than posing in the PR as if he has delivered something. [...]
The projected number of jobs in the New York area from this is 2,500. That's a very small number and will have no effect on the unemployment problem of this city [New York City] it's just too small and that's not a surprise [...] because the kind of work Amazon does is highly automated; it uses machines for 90% of what it does. And half of the people it's likely to have working in New York will be brought in from other parts of the Amazon empire.
They must be really serious about drone delivery...
I don't take Amazon's numbers seriously until they show that they will live up to their own hype. If Wisconsin's Scott Walker was elected on making 250,000 new jobs in 2010 he has fallen far short of that. One of his job-creating deals was Foxconn, something he used to tout heavily but tried to shy away from when he last ran. Foxconn's 13,000 (I'm assuming human) job figure for Wisconsin hasn't been met. I'll believe it when I see it but I still don't see how New York is getting a fair deal in this; it seems like they have no problem attracting businesses to their city and don't need to give nearly as much as they are.
Transcript should arrive here eventually: https://therealnews.com/stories/amazon-gets-3-billion-in-ny-...
Video: https://www.youtube.com/watch?v=KlECXGQfVyY
Some of the highlights of the jobs points that makes it clear the exact figure of the promised number of jobs is virtually irrelevant precisely because so little is asked of Amazon here:
- Ben Norton says that in 2017 NYC gained over 72,000 new jobs. Therefore the money NYC is giving Amazon with virtually no strings attached effectively buys them about 4 months of job growth. That's a remarkably low number of jobs for such a large amount of money.
- It's not even clear if the 25,000 jobs are new jobs or if Amazon will shift workers from one location to HQ2. This means New Yorkers are subsidizing job movement for extant employees.
- There are no performance guarantees for Amazon in this -- if Amazon doesn't add the promised number of jobs, or if those jobs turn out to be significantly less attractive (perhaps near minimum-wage jobs, it takes Amazon a decade to add these jobs, or the jobs are done remotely thus pitting New Yorkers against the rest of the world) there's no penalty for Amazon to pay. No Amazon profit-sharing to NYC.
Yes it brings talent. But that doesn't mean such people are startup talent.
It's also going to drive up demand for housing (read: the cost of housing). So for those __not__ employed by one of these, the question becomes: how much __startup-centric__ talent are they driving __out__ of your area?
Long to short, the market is being manipulated, and it's being manipulated by the government. The gov created the house bubble and the student loan bubble. If there are examples of the gov manipulating the market and that ending well for taxpayers, I'd like to read about it.
I'm not sure this type of competition is a great thing for citizens, but is this really a wealth transfer from the poor to the rich? Doesn't most tax revenue in the US come from the rich, meaning they're covering most of the bill? In that case it would be more like wealth transfer from rich people to rich companies with some of that wealth making its way back to a subset of rich people and companies (i.e. investors).
I'm sure there are secondary effects impacting the poor but I'm not sure it's as simple as mean rich people reaching into the pockets of the poor - there's not enough money there for it to be a compelling strategy.
Doesn't matter where tax money came from, that part we are not changing. What changes is where that money goes. It could pay for schools, Medicaid, homeless shelters. Now there is going to be less of that, as we are building a helipad for Bezos with some of that money instead.
Which is why it's a wealth transfer towards the rich.
Yes, it could, but that doesn't mean it would in the absence of the incentive for Amazon. I didn't see any indication in the article that this would be paid for by reallocating funds from social programs or education. Has NY indicated how they're funding the incentive elsewhere? If this isn't known, how can you confidently say it's a transfer of wealth from poor to rich?
To be clear, I absolutely think there are probably more socially responsible things to do with the money, but there's a difference between opportunity cost and exploiting NY's poor to build Bezos a helipad.
Where did NY indicate that they're reallocating money from those programs?
I don't think they would. Big infrastructure in New York is expensive, financially and politically. Without Amazon's pressure, there is no way the new campus would have been developed, hooked up and approved as quickly as it has been.
That's just as bad as Irelands tricks helping to avoid taxes due in the UK and other eu states
Which is also why we see the EU go after Ireland and require that they collect taxes from Amazon :) I recall Vestager starting to get the ball rolling a few years ago.
https://www.duijntax.com/en/advance-tax-rulings-negotiations as just one example reference I could quickly find.
Could that possibly make Amazon more efficient, and so employ more people who spend their salaries and so on, creating a net gain for the whole US?
They'd be much better spending that money on their neglected public transit or their neglected public housing...
But some cities were suggesting that! They were going to invest in infrastructure, knowing that the extra income from Amazon in the area would pay for it. It was not a zero-sum game.
For example some cities were proposing building things like extra train stations, which benefit everyone, and aren't something Amazon could have done privately.
Public infrastructure is available to all.. why can't the public finance it without Amazon?
Cities may have been hoping that with Amazon moving into a region they would have extra tax receipts which would enable spending they would not have been able to afford before.
But even then, there's probably some inefficiency in that replacement.
Company A creates a “new” job. They hire an employee of Company B, who in turn poaches a replacement from Company C, and so on.
It’s fair to assume that some hires will be new arrivals to NYC, and some might come from the pool of unemployed. Most will have simply hopped from one employer to the next, replacing one job opening with another.
How about for tech workers to get a raise? Or to move to a different part of the city? And besides, this is just conjecture. Do you have any data or polls or even anecdata which supports your claim?
One of the big issues I have with these deals, is towns/cities don't have experience adding safety clauses to these, that are legally binding..
An equally good deal would have been not paying 48K and getting Amazon elsewhere in the US. I mean, not for NYC, but for the US as a whole it would have been equally good.
The race to the bottom is lined with "good deals"...
And an even better one would have been free ponies for all and rainbow shitting dinosaurs. Also wasn’t on the table, however.
$1.5 billion in housing or just really anything to help people who already live there is what should happen.
New York has a problem. San Francisco has a crisis.
I just negotiated a 2% rent cut. Like four luxury buildings opened nearby and sucked out our building's highest-earning renters by offering lots of perks for marginally more rent. I asked my landlord if he wanted another vacancy or to keep a hassle-free tenant--he budged.
And my experience is not that unique. "Manhattan rents dropped 3.8 percent in March [2018] from a year earlier, the most since 2011" [1].
[1] https://www.bloomberg.com/news/articles/2018-04-12/pick-a-ne...
Also, NYC doesn't have nearly as much of a NIMBY problem as many other American cities. We continue to build lots of housing here.
Additionally, there are hundreds of thousands of people who are rent burdened in New York, even in those places with so called cheap rent such as within south bronx.
And then there's also registration, emissions testing, annual inspection, and other miscellaneous fees that vary by jurisdiction, but that can easily cost hundreds per year in total.
https://www1.nyc.gov/assets/buildings/html/nyc-active-major-... https://www.nynesting.com/new-developments
Nothing stays forever in NYC which is kind of why it is such a great city.
People who live here will benefit from this. NYC has a much more diverse candidate pool than SV - 47% of our tech workers are immigrants. Our schools are more diverse; there are more programs to teach underrepresented groups CS skills. They will benefit from this.
>gentrifying forces of a thousands of tech employees.
Can you explain how gentrification will actually play out, and how it's different than 25k jobs being created organically over the next decade?
>$1.5 billion in housing
Just because Amazon has been given an incentive doesn't mean that housing gets short sticked. https://www1.nyc.gov/site/hpd/about/press-releases/2018/07/m...
Apart from having to compete with NYC’s already bustling tech presence, they’ll be competing to hire the same engineers that investment banks, hedge funds, and HFT groups are after. The comp packages in fintech are impressive, and generally all cash (as opposed to a mix of cash and stock).
This has long ago been cemented...
For the last decade Cuomo has been giving subsidy after subsidy, tax break after tax break, to corporations from Long Island to upstate New York. Each one came with projected revenues and gains, and each and every one failed miserably and ended up costing NY taxpayers countless billions - while most of the corporations walked away with a profit.
https://www.niagara-gazette.com/news/local_news/state-of-sub...
https://nypost.com/2018/07/21/cuomo-has-wasted-billions-and-...
That's key then isn't it. Where it's going to come from needs to be clear, or else there's a very real risk it's not a good deal.
Sales pitches stack the deck on expected benefits ALL the time. Diligence is essential here, and the devil is always in the details. 'Potential benefit' rapidly morphs to 'definite benefit' when stuff percolates up into articles etc.
As the article says, they give up $1.5B over 10 years, but then get "Projected incremental tax revenue of more than $10 billion over 20 years."
I dont know where that comes from but the payroll and property taxes paid by 25k employees dwarves the incentives.
The most important part is it cements NYC as the main tech center on the East Coast. That is invaluable.
EDIT: I wonder if NYC with tax incentives, Amazon would still pay more tax than regular tax rates in FL, TX.