Since you seem so opposed to tax breaks for big corporations, have you also lobbied for repealing the Excelsior and REAP programs? Or do you get upset only when these programs are applied to Amazon?
Thus, the only reason it is "in your best interest" is a prisoner's dilemma. https://en.wikipedia.org/wiki/Prisoner's_dilemma
Any city has two options: A) hurt yourself by making big concessions, B) don't do that. (Obviously also various degrees of A, but that does not matter in the following).
Ideally for your city and all cities, every city goes with B) and you get the deal by virtue of what should matter (existing infrastructure, location,...). However, if another city "caves" and offers A) they improve their chances, so what happens is that all cities offer A). That decision is "in your own best interest", but everybody is worse off than if nobody did that (same for bribery and paying "protection money" to the mafia).
Thus, yes I am opposed to Amazon receiving the benefits of these programs. However, instead of repealing them outright, they should include a ceiling.
If that sounds absurd, I certainly think it is. Local governments shouldn't be trying to "profit" by taxing its residents and companies. The whole purpose of local taxes is to best serve local residents and companies. If a city/state can better serve its people by lowering its taxes or by offering tax credits for specific programs, it should certainly do so, even if there's no competition involved. There is no prisoner's dilemma here.
I wouldn't have thought that I need to pay companies to exploit my local labor pool. I'm not buying something from them. They're buying something (work) from me.
Because Amazon can easily go elsewhere, and most places have lower taxes than NYC. Giving them a ~10% off coupon on an extremely high tax rate is not the same as handing them money.
You can object to the deal on principle, sure, but you're ignoring the fundamental reality of the situation; if NY refuses to give them any incentives, they can just as easily go to some other location that will give them incentives. And if all the states banded together and agreed that nobody would give them incentives, NY still loses, because then they'll just pick a place with lower tax rates.
I can understand the appeal of trying to stand up to big corporations, but in the end, NY isn't screwing Amazon by refusing to negotiate with them on this, they're just screwing themselves. If you want to have high tax rates and not lose business to other states, it's a winning strategy to be open to compromise sometimes.
Amazon did this to themselves with their tone deaf "national search" and if anything they proved to everyone that Amazon needs NY more than NY needs Amazon. Otherwise, they would have picked any of the other numerous smaller cities that were on the radar of the search, but were not chosen.
Clearly they can, if they this quickly pulled out of NY after the reception they received.
Instead they did the dog and pony show of shopping their Decision around, commited to NY and had to backtrack. You can't spin this as a plus for Bezos.
Yes it is. How the hell is it not?
and Amazon wants NYC for the size of it's talent pool and ease of recruiting. NYC has no reason to give them anything.
> If you want to have high tax rates and not lose business to other states, it's a winning strategy to be open to compromise sometimes
NYC is having so much trouble getting businesses to come.
If I give you $27 and you give me $3 back, then yes, technically you've handed me $3. Taking that out of context ignores the end result, which is that I've given you a net $24. You wouldn't be $3 richer if the transaction had never taken place, so acting all indignant that you paid me $3 when you came out way ahead seems pretty disingenuous to me.
If McDonalds gives me $1, I don't need to buy a big mac and can go spend it at some other store.
Put another way--why should Amazon go to NYC? Do New Yorkers have a god-given right to the benefits of large tech companies?
Amazon always wanted NYC. They overplayed their hand trying to get a break and it blew up in their face.
They probably could have gotten away with most of it if they did this with less fanfare.
There will always be some megacorp looking to open up in NYC. Why diminish the return for the city?
So Amazon is at lower risk of bankruptcy and a higher credibility of eventual return of those investments?
Don't hate the player, hate the game.
Why not both?
Can we get rid of those?
Without the players, the game ends.
Amazon can afford to pay its own costs many times over. Many SMEs cannot. I'd have had a lot of respect for Amazon had they just chosen a site on logistical criteria and built it out of pocket. Instead, I despise them even more than before.
If Amazon moved in the public coffers would be 3B smaller and those benefits might not exist.
Amazon is a publicly traded company. Like every company, the point of the business is to generate profit. This means reducing overhead costs in order to do so.
Sure, they could do it out of pocket, but why do that when NY was offering standard business incentives to bring them there? Why cost your investors money when you don't need to?
Look at any large company, they're going to do the same thing and try and leverage any avenue to reduce overhead costs. It's just smart business, period. Show me a company who paid their own way without any state or local tax breaks and I'll show you 100 fold more who did.
So if it won't harm the shareholders ( most of whom are secondary-market holders and thus not investors ) why not what is morally right versus technically right?
Isn't that what we ask engineers to consider before working for ad networks, for example? Why does that not scale to companies?
What? The point if owning stocks is receiving dividends, otherwise it's just speculation. Without dividends, you can only realize gains by selling to someone else, turning the whole thing into a Ponzi scheme.
The idea that they had to do this out of "obligation to shareholders" is ridiculous. Amazon has avoided profit in search of growth for decades. For a supposedly long term thinking company this was a misstep.
By preventing the massive rent increases and forcing out of the locals that Amazon will bring?
Damn, that must suck.
https://www.marketwatch.com/story/what-amazons-hq2-means-for...
> For the Long Island City location, Amazon was going to receive $1.2 billion in refundable tax credits through New York State’s Excelsior Jobs Program if the company created 25,000 net new jobs in New York State by the end of June 2028.
> New York State had also promised a $505 million capital grant to reimburse Amazon for the costs associated with building its office space.
> Amazon also planned to take advantage of incentives through New York City’s Industrial and Commercial Abatement Program and New York City’s Relocation and Employment Assistance Program (REAP). Unlike the incentive offered by state officials, these city programs are available to any businesses that meet their specific requirements. Tax breaks through REAP, for instance, could have added up to $900 million.
Most of the subsidies are coming from existing programs which every company can take advantage of. The only special treatment Amazon is getting is the $500M mentioned above. Which works out to $2000 per job, over 10 years. An amount which is recouped in a few months of NYC city taxes alone - a tax which most other cities do not have at all.
I can see why people outside of NYC would be cheering for this. But it's insanity for locals to be celebrating shooting themselves in the foot. HQ2 would have cemented New York's place as the country's #2 tech hub after silicon valley. Over the next 20 years, New York could have even challenged and supplanted silicon valley. For tech workers in the city, it would have given them greater bargaining power when negotiating compensation with their existing or new employers. And for startups, it would have offered another source of employees to poach from, and a company that could easily acquire them.
New York has always succeeded because it was a pragmatic city. But this entire debacle is the kind of political dysfunction that I would have expected from San Francisco, not NYC.