After HQ2 announcement, civic leaders regret groveling before Amazon

“Giving Jeff Bezos hundreds of millions of dollars is an immoral waste of taxpayers’ money," said one politician

By Nicole Karlis

Senior Writer

Published November 13, 2018 7:53PM (EST)

Jeff Bezos (Getty/Photo Montage by Salon)
Jeff Bezos (Getty/Photo Montage by Salon)

Big-city mayors across the nation spent much of this and last year ingratiating themselves with Amazon CEO Jeff Bezos. The goal? To make their city the permanent address of the tech behemoth’s second headquarters, which the company's PR team dubbed "HQ2." Most civic leaders of destinations on “the list” tried to woo the world’s richest man with million- (or billion-) dollar tax breaks, among other financial incentives that would gift taxpayer money to one of the most valuable corporations on the planet.

Yet an official announcement on Monday from Amazon dashed hopes for nearly all of the grovelers. Amid swirling rumors, and nearly 14 months since the unofficial competition began, Amazon officially announced that the New York City borough of Queens and Arlington, Virginia, have been selected to be the dual homes to the new headquarters. In an announcement, Amazon said it will invest “$5 billion and create more than 50,000 jobs across the two new headquarters locations, with more than 25,000 employees each in New York City and Arlington.” Moreover, Nashville, Tennessee has been selected for as a new "Center of Excellence" for its Operations business — which is responsible for the company’s customer fulfillment and supply chain — which will bring an estimated 5,000 jobs to that city.

The news has left many city leaders from the initial list of 238 city participants rethinking the point of the entire competition.

“Of course #jerseycity would benefit if it’s in NY but I still feel this entire Amazon process was a big joke just to end up exactly where everyone guessed at the start,” Jersey City Mayor Steven Fulop tweeted. “No real social impact on a city, no real transformation, no inspiring young residents that never had this.”

Pittsburgh, Pennsylvania, made it to the finalist list. The city’s mayor Bill Peduto said he plans to make what he can of the city’s bid public to provide more transparency into the process.

“It is time for our residents to know what our elected leaders were willing to promise the world’s wealthiest man,” Wagner said in a statement after the announcement.

Meanwhile, some leaders in Queens, New York, aren’t happy to be the chosen ones. Democratic Assemblyman Ron Kim is introducing a legislation to cut subsidies and redirect the money to end student debt.

“Giving Jeff Bezos hundreds of millions of dollars is an immoral waste of taxpayers’ money when it’s crystal clear that the money would create more jobs and more economic growth when it is used to relieve student debt,” Kim said. “Giving Amazon this type of corporate welfare is no different, if not worse, than Donald Trump giving trillions in corporate tax breaks at the federal level. There’s no correlation between healthy, sustainable job creation and corporate giveaways. If we used this money to cancel distressed student debt instead, there would be immediate positive GDP growth, job creation and impactful social-economic returns.”

Amazon will receive over $2 billion in incentives from the new three locations. Previously, Chicago offered to redirect 50 to 100 percent of Amazon employees' income taxes back to Amazon — in effect, gifting billions of dollars of workers' tax money to a corporation worth around half a trillion dollars. In response to not winning the bid, Mayor Rahm Emanuel said he did not regret the city not offering more financial incentives, according to ABC.

"I do believe the right way you incentivize a company isn't through money, but also a 21st century airport, 21st century mass transit and 21st century workforce," Emanuel said.

Other leaders of cities that were considered are trying to stay on good terms with Amazon.

"I have never been more proud of the City of Columbus and its partners than during our bid for Amazon HQ2," Mayor Andrew Ginther of Columbus, Ohio, said in a statement. "Our collaborative spirit is in high gear, and this process reinforced how well our region competes together. Amazon may not be building its next headquarters here, but the company remains an excellent partner with multiple facilities in central Ohio."

Incentives offered by Columbus would have saved Amazon $2.3 billion in over 15 years.

Indeed the announcement brings to a close an interesting chapter in modern American history, one that marks the most extreme courting phase American cities have exhibited with a big corporation. As I wrote before, the competition has raised a big question in regards to the economy and  big tech corporations, such as: Why are politicians so desperate for us to believe that the path to prosperity is to put our faith in big corporations?

By Nicole Karlis

Nicole Karlis is a senior writer at Salon, specializing in health and science. Tweet her @nicolekarlis.

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Amazon Amazon Hq2 Bill Peduto Jeff Bezos Neoliberalism Ron Kim Steven Fulop