Friday , October 22 2021

The progressive slack in relation to Amazon HQ2 is growing. Because


In the 14-month madness, cities in North America leaned back to earn the second headquarters of the Amazon, HQ2, offering subsidies and tax breaks. Recent reports suggest that Amazon can split its new office campuses between Long Island City in Queens and Crystal City in Arlington, Virginia.

The company has committed to spend at least $ 5 billion and create 50,000 jobs under the project. Even divided into two locations, which is a huge brew in the local economy.

But when Amazon's decision (AMZN) approaches, the opposition to huge economic packages of urban behavior is getting louder. Groups organizing the pressure of local leaders say that financial sweeteners are unnecessary due to the size and wealth of Amazon, and believe that money will be better spent on community services.

"We will do everything to fight Amazon arriving in New York, and [to stop] Any benefits that our mayor and our governor could put on them, "said Jonathan Westin, executive director of the New York Communities for Change, a support group that supports low income communities in the region.

Amazon has long been the goal of liberal supporters. They protest against his record in terms of pay and working conditions in their warehouses and blame the company for the gentrification of his hometown, Seattle. Senator Bernie Sanders slammed the company's treatment of employees, although he ultimately supported Amazon when he said he would pay US workers a minimum of $ 15 per hour last month.

Now with the possible arrival of the new Amazon headquarters in Long Island City and Arlington. the struggle of activists is spreading – and some local officials are on the side of activists.

"I understand that the public subsidies in question are massive," said Senator New York, Michael Gianaris, who represents the Long Island City area in an interview with CNN Business. "Why would we need to pass the scanty public money of one of the richest companies on Earth, it's beyond me."

Amazon HQ2: The advantages and disadvantages of choosing two cities

The terms of the Amazon offer from New York and Washington have not been disclosed, so it is not clear what exactly is on the table. However, precedent and public statements indicate that Amazon can get generous offers in exchange for investments and jobs.

On Monday, New York governor Andrew Cuomo said he would change his name to "Amazon Cuomo" if it meant that the company would choose New York for HQ2. "I do everything I can," he told reporters, adding that New York has a "great incentive package."

Cuomo enthusiasm can not fall. Local officials are elected to speak out against a potential transaction.

"The lack of transparency in this process is outrageous," said local councilman Jimmy Van Bramer on Thursday.

The mayor of New York, Bill de Blasio, called the HQ2 security "a huge opportunity," but admitted this week that "there are real developmental pressures that should be used." He said the city would not reward Amazon with any special incentives beyond what is available to all companies and developers.

"I want to distinguish the state from the city – the city does not provide subsidies," he told reporters on Tuesday. "We do not believe in corporate subsidies for retaining or attracting a corporation."

For the state senator Gianaris, incentives are not the only problem. He also wants to know what Amazon is going to do to relieve stress in schools in the area and the busy metro system. "This is a district that is already overdeveloped," he said.

Activists say they have similar concerns about Amazon, which they do with Walmart (WMT). Progressive groups have successfully maintained Walmart from New York for decades, citing the treatment of employees with low wages and harming smaller companies.

"We believe that Amazon is another iteration of what Walmart was," said Westin of New York Communities for Change.

Such points of view also appeared in Washington. The group named "Of course not DC", supported by a group of activists, the Fair Budget Coalition, and the Democratic Social Democratic Party, has a simple slogan: "Finish our communities, cheap housing, schools and transit." Not Amazon. "

Everything we know about HQ2 search in Amazon

Huge incentive packages are a popular tool for attracting large development projects, said Megan Randall, an analyst at the Tax Policy Center. The problem is that such packages often do not have adequate remedies to ensure that the promised economic benefits materialize, she said. It is also unclear whether companies prioritize incentive packages when deciding where to locate – she added.

"Research shows that tax incentives play a rather minor role when it comes to where companies decide to go," said Randall.

Issues of strong economic incentives arose when Foxconn, Taiwanese Apple's suppliers, announced in 2017 that it would invest $ 10 billion in building a plant in Wisconsin. He pledged to create up to 13,000 jobs by 2020 and received over $ 4 billion instead.
This week, as the Wall Street Journal reports, Foxconn has trouble finding the engineers he needs at the factory, and is trying to recruit staff at some plants in China. Foxconn denied the report.

Nevertheless, economic incentives are a common part of development contracts. In the case of cities, it is difficult not to use allowances, such as tax breaks and subsidies, if competing regions offer them.

"It is difficult to say whether the questions that the public and decision makers ask about will become a feature of the discussion," said Randall. "or if tax incentives keep their popularity."

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