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Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

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Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#101

Post by Ericson2314 »

KevinEldon wrote: post #45
jinushaun wrote: post #37

After all the pageantry Amazon picks the #1 and #2 most obvious cities for HQ2. Which leads me (and many others) to believe that they would have expanded their NYC presence anyway. Amazon already has THOUSANDS of employees in the NYC area. It was inevitable. What rubs people the wrong way was that Amazon got a tax break it didn’t need. And even after this deal has “died”, Amazon will STILL continue to expand in NYC!…

And yet the elected officials of NY didn't think Amazon would choose NY without offering Amazon incentives to expand in NY. Why did they do that?

I think they were being stupid. Their terrible rhetoric around the issue certainly doesn't imply that they grasped the situation.

If they publicly bemoaned the shakedown from the get-go, but claimed they hsd to participate abyways, they would have improved their negotiating position, and maybe diffused blowback too.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#102

Post by minikites »

downandout wrote: post #55
minikites wrote: post #32

Earlier quoted context omitted.

https://twitter.com/akarl_smith/status/1096123735935987712 If New York was willing to give $3 billion to Amazon, maybe New York can now use that money to hire 25,000 workers.

Your comment, along with the tweet you linked to and all other tweets like it, reflects a fundamental misunderstanding of the deal, resulting from a gross oversimplification of it. New York was never “giving” Amazon even $1. They were simply going to give Amazon a tax discount for a limited period of time, and the estimate was that the tax savings would have been about $3 billion over 10 years. This money is not sitt…

It's interesting that you use retail coupons as an analogy. Are you familiar with the idea of a loss leader? What happens if that revenue isn't earned elsewhere?

It's not at all clear that New York would come out ahead on this deal, given the infrastructure costs and Amazon's well known tendency to avoid paying taxes.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#103

Post by leroy_masochist »

> The livability crisis that’s currently afflicting Seattle and San Francisco is evidence of how cities need to be careful what they wish for when it comes to the explosive growth of technology companies (and the attendant wealth that comes with it) in their metropolises.

Let me get this straight, New Yorkers should view Seattle and SF as cautionary tales for what happens when high-paying jobs arrive in a metropolitan area? Has the author ever visited New York City?

SF's issues aren't caused by swanky new jobs, they're caused by NIMBY politics. NYC has easily 10x the number of high-earning jobs as SF, no matter how you define high-earning. Fortunately, the people running our local zoning are only like a 5 or 6 on a 10-scale of batshit crazy.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#104

Post by whatok »

oarsinsync wrote: post #88
whatok wrote: post #47

Earlier quoted context omitted.

Sports stadiums and the Olympics generate temporary jobs and generally do not have the same economic impact of 25k jobs paying 150k over ten years. Amazon's tax breaks were tied to headcount so it's hard to see how the city would be a loser in this case.

> 25k jobs paying 150k I've seen a few people make this remark, on the assumption that every single job was going to be a high paying job. I believe this is an assumption as I don't recall seeing anything from Amazon stating that they were intending to do this either. A citation would be helpful for this position.

You've seen a few people reference this because it was in a widely circulated press release by the company itself.

https://press.aboutamazon.com/news-releases/news-release-det...

Third bullet under Amazon in Long Island City in New York City:

Amazon will receive performance-based direct incentives of $1.525 billion based on the company creating 25,000 jobs in Long Island City. This includes a refundable tax credit through New York State’s Excelsior Program of up to $1.2 billion calculated as a percentage of the salaries Amazon expects to pay employees over the next 10 years, which equates to $48,000 per job for 25,000 jobs with an average wage of over $150,000; and a cash grant from Empire State Development of $325 million based on the square footage of buildings occupied in the next 10 years. Amazon will receive these incentives over the next decade based on the incremental jobs it creates each year and as it reaches building occupancy targets. The company will separately apply for as-of-right incentives including New York City’s Industrial & Commercial Abatement Program (ICAP) and New York City’s Relocation and Employment Assistance Program (REAP).

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#105

Post by at-fates-hands »

dingaling wrote: post #86
whack wrote: post #69

Earlier quoted context omitted.

So now we're going to blame Bezos for using a incentive-program the way it was expressly meant to be used? Perhaps we should also start shaming white collar professionals who take advantage of 401k plans and Mortgage Interest deductions. If they didn't try to reduce their tax bill, that money could have gone to others who actually needed them. Don't hate the player, hate the game.

> Don't hate the player, hate the game 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.

> 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.

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.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#107

Post by bogomipz »

repsilat wrote: post #77
paulgb wrote: post #30

Earlier quoted context omitted.

Yes, but the whole thing has a Karmic feel to it. Amazon used a very public HQ process which turned the process into a public game show. Since they used public pressure on local politicians as a bargaining chip to get a deal done, it feels fitting that it backfired this way.

A little ironic in the other direction too, I think. New Yorkers saw the deal as corrupt favouritism and wanted to stop it from happening. Now New York has even more of a reputation for corruption by making it clear they won't uphold the terms of deals they make. Really, Amazon are lucky the subsidies disappeared before they made significant capital investments, otherwise it would practically have been extortion.

>"Now New York has even more of a reputation for corruption by making it clear they won't uphold the terms of deals they make."

First of all New York didn't rescind the terms of any agreement. Amazon made the decision not to go forward.

Second Governor Cuomo pursued the deal as a "General Project Plan", this is a state process that circumvents a local approval process that would involve the city council and any community input. If there's any "corruption" here it was in the way this thing was pursued from the outset.

So no, not "ironic" at all.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#108

Post by ap24 »

tomatotomato37 wrote: post #84
ltc5505 wrote: post #8

Earlier quoted context omitted.

They said that the search for a HQ2 will not continue and instead they are focusing on increasing presence in NY, VA, and I think TN. Not sure if the increased presence is 25,000 jobs worth.

TN as in Tennessee? I thought altanta was the tech hub for that general geographical area.

Amazon has already announced 5,000 jobs going in Downtown Nashville - it came out the same time the split up HQ2 did.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#109

Post by moosey »

oliwarner wrote: post #95
moosey wrote: post #75

Earlier quoted context omitted.

I'm going to disagree with "It's natural". We have created a business and government environment where it is likely to happen, but we can change that environment at any time, just as Reagan created the current business environment 30 some odd years ago.

I thought it was fairly clear in a context so devoid of nature, natural might suggest logical consequence but you're the second person to quote the word.... So for the record: No, Amazon are not doing it like they do on the Discovery Channel. And yes, this it a logical side-effect our how our society has developed. Capitalism and globalisation concentrating money into megacorps like Amazon. This is certainly somethin…

Well, "It's natural" can also mean that it's a state of things that we should accept. Or it could be a reference to a moral framework where virtues are applied to state. It could be arguing that what is happening in the consequence that we expect in all systems at some point. There are lots of uses of the word, and I don't think that any of them really apply well to the current topic.

How to deal with the existence of Amazon? I don't know. My guess is tax policy.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#110

Post by scarface74 »

whack wrote: post #67
sys_64738 wrote: post #65

Earlier quoted context omitted.

It doesn't matter how much money Amazon got as it's the perception of the fact they are getting a tax break which is why it's shocking. Amazon isn't some two-bit startup which has no VC funding. It's the richest company in the world so why the heck do New Yorkers need to hand over their cash to bring them the Queens?

For the same reason you hand over your cash in order to buy stuff on amazon.com or run things on AWS. Not because Amazon deserves your money, but because it's in your own best interests to do so. 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?

I voluntarily hand over my money to AWS for them to provide a product. The government is not forcing me to hand money to them.
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