211–220 of 227 posts
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The $27B is a present value sum of future cash flows, not an annual revenue.
Thanks, corrected. Even so, still a ton of revenue.
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This is about diversifying the economy away from real estate and wall street. It is also about bringing high-paying jobs to Queens, and encourage the kind of investment that brings. From what I understand developers started building in anticipation of Amazon coming there, and that investment is now in question.
The area has been built up with skyscrapers over the past decade, well before HQ2 had even been announced. Development in New York is not so quick that you could shovel a project through in the four months after the announcement. New York's economy is plenty diverse. There's real estate and Wall Street, sure, but there's also legal services, advertising, media, health, education (NYC has the largest student populatio…
This story is so good because it perfectly illustrates the issue with politics today: - A vocal minority of leftists managed to force a silent majority. Once they won, they didn't really know what to do. Now everyone realizes that New York is worse off. - All of the outrage started and snowballed on Twitter, where self-centered politicians decided to use it as a way to virtue-signal. - The press did an awful job on t…
Not sure how you've reached this conclusion. "Worse off" is subjective.
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This is about diversifying the economy away from real estate and wall street. It is also about bringing high-paying jobs to Queens, and encourage the kind of investment that brings. From what I understand developers started building in anticipation of Amazon coming there, and that investment is now in question.
The area has been built up with skyscrapers over the past decade, well before HQ2 had even been announced. Development in New York is not so quick that you could shovel a project through in the four months after the announcement. New York's economy is plenty diverse. There's real estate and Wall Street, sure, but there's also legal services, advertising, media, health, education (NYC has the largest student populatio…
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> I suspect I'll never get why the notion of giving a tax handout to a company that's one of the most valuable in the world shouldn't be a non-starter. I mean, it's pretty straightforward. When you set your basic taxes high enough, it no longer makes sense for some people to do business in your jurisdiction rather than another, so in order to convince those businesses to do business in your jurisdiction (and still ge…
Tax rates seem to be a want bonus compared to their actual needs anyway. If it was really as big a factor as pundits claim we would see a lot of jobs in unincorporated areas - yet instead they are in places where populations and infastructure are. Essentially it is a reverse of why there is a sticky price point of items disconnected from actual price - it is what the market will bare. If the fundamentals of an area a…
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As an attorney, I’m curious as to how you think a constitutional equal protection issue is at stake here. I’m unaware of any case law that would suggest so.
I'm curious why Congress has chosen not to regulate (or ban) the grant of tax incentives to companies as enticements for development; this seems to easily fall under the interstate commerce clause. All states lose out when they compete against each other in this way.
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I’m not sure if it was a typo on your part, or you might be misinformed of what the actual deal was that was struck. From TFA; “Amazon was to build their headquarters with union jobs and pay the city and state $27 billion in revenues. The city, through existing as-of-right tax credits, and the state through Excelsior Tax credits - a program approved by the same legislators railing against it - would provide up to $3…
Giving amazon the ability to not pay taxes is a subsidy. My question is whether it would still have been a good detail if NY had removed 26B of their tax burden because of the economic benefit? Where is the line in your view? How much help is too much for a company?
The economics which determine where the “line” is, is set by the market of people/companies willing to move into and invest in the city, the services and infrastructure and regulation and talent pool they require to be able to function effectively in the city, and the tax burden they are willing and able to shoulder relative to other available tax/service/infra/talent bundles available elsewhere and their own profit margins.
And all that is a calculation companies perform within and between municipalities when selecting where to grow and invest.
And also a similar calculation made by the residents who move into and out of a city based on the services, infrastructure, tax rate, and companies that are present.
Some economicist must have modeled all this and drawn all the supply/demand curves, and the equations which show how certain curves shift in response to taxes or stimulus or investment in any of the various areas.
The short answer is at the bottom of the letter — a 10:1 return on investment would have been a massive win for any development agency.
Maybe there is a way to model the breakeven point accounting for all the various future cash flows. Maybe we can make a list of all the similar projects and their expected ROI and rank them, e.g. as a dollars per job created number, or a ratio of tax dollars forgiven versus tax dollars collected.
But very subjectively a good deal is one that leaves the community better off in the long run. There’s no way to know this a priori, but all the evidence points to this deal being a truly massive loss for this community.
Amazon can do things for a locale that no amount of simple tax revenue can do. Because they can profitably employs tens of thousands of people. It’s actually the most important function of a city, to enable profitable sustainable jobs for its residents. It’s not, in fact, simply all about the Benjamins.
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> and a tax base necessary to invest in Queens that has received very little investment in decades. In what alternate universe is this? Queens is hardly Camden or Detroit. The neighborhood in question has 40+ story office and residential towers sprouting up like weeds. Queens is at a record low employment rate ever since this started getting tracked at the county level: https://fred.stlouisfed.org/series/NYQUEE1URN .…
LIC does not have many commercial tenants, and none on the scale of Amazon. It would be a good thing to not concentrate all jobs in Manhattan. Also, if you walk around LIC, it's not as developed as you might think, sure there are huge buildings, but they're next to empty lots & industrial spaces. It's largely a desirable area because of it's proximity to Manhattan, not really anything intrinsic about the neighborhood…
Putting jobs in LIC will still force workers from the non-Queens sections of the metro area to go into Manhattan and then back out to Queens. Even the LIRR can't really serve LIC, because it's impossible to build a station that serves waterfront LIC that is on the way to Penn.
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The area has been built up with skyscrapers over the past decade, well before HQ2 had even been announced. Development in New York is not so quick that you could shovel a project through in the four months after the announcement. New York's economy is plenty diverse. There's real estate and Wall Street, sure, but there's also legal services, advertising, media, health, education (NYC has the largest student populatio…
So you are saying Queens is in a great place and we do not need to create much more opportunity there?
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> Well if Amazon could not find 25k employee in the given time they would not receive the 3 billions in tax relief The problem of the deal wasn't the mechanics, it was how it was sold to the public. A competition putting cities against cities, negotiated without any public input, a large tax break to one of the richest companies in the world, choosing already popular cities rather than really investing in a newer one…
Maybe, but as it is pointed out many times here and in the open letter this was basically a replay of Brexit. another commenter said that his mom believed the city would give amazon 3 billions up front. the public approved of the deal, the only demographic to disapprove was the internet. 70% of local residents approved of the deal. that is a lot.
Depending on
* how the question was framed ("Do you think the second headquarters of Amazon will be a positive?" vs. "Do you think the deal with Amazon will be positive?" vs. "Do you think tax breaks for Amazon are good?")
* how informed the voter was required to be; people are notoriously uninformed and uninterested about anything that isn't a presidential election
* how residents were contacted (was it a landline poll? mail? survey on the street? online? because these all have different populations to be accounted for)
* who counts as a valid resident for the survey? someone who lives in Buffalo? someone who lives in Westchester? someone who lives in Manhattan? someone who lives in Flushing? etc.
Polls predicted that AOC would lose her race, and that clearly didn't happen.