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I agree with you that these kinds of transactions are regrettable and they leave a bad taste in my mouth. At the same time, you haven't convinced me that local
by trgv 9y ago
I agree with you that these kinds of transactions are regrettable and they leave a bad taste in my mouth. At the same time, you haven't convinced me that local governments are making a bad decision by playing this game.
I think perspective is key here. From a broad economic perspective, Amazon is going to build this thing somewhere, and so these kinds of trade-offs seem pointless. Economists likely object because the whole thing is economically inefficient from a broad (national) perspective.
But from the perspective of a local government, that may not be the case. A local government is concerned about the local economy more than the national economy, and so offering these perks makes sense.
Again, I agree that the whole thing is regrettable, and that it probably hurts the economy as a whole. I wish Amazon didn't play these games. But I also think it's worth pushing back against the idea that these local governments are clueless idiots. They may very well be making a good decision from their narrow perspective, and the city that Amazon chooses may very well see a net increase in tax revenue.
- grecy 9y ago> I wish Amazon didn't play these games. This has nothing to do with Amazon "playing games" and everything to do with politicians making deals so multi-billion dollar companies can avoid their tax obligations. Hilarious, anywhere else in the world it's called corruption, but in America "It's just business" >They may very well be making a good decision from their narrow perspective, and the city that Amazon chooses may very well see a net increase in tax revenue. There is no universe where that is true. It just means all the cities are in a race to the bottom competition. Sure their tax revenue may have net increased, but it will be by a much lower amount than it should be. "Net increase in tax revenue at all costs" is not the goal here. What do you think is going to happen when this happens all across America, and every time a monster company does something they get out of paying billions in tax?
- Anon1096 9y agoA city's tax revenue isn't "lower than it should be" with Amazon's headquarters (subsidized by the taxpayer). If they don't attract Amazon, they don't get any money at all. With Amazon, they get increased employment and all the taxes employees are now paying. And all the benefits of having a tech giant centered in your jurisdiction. It's a win-win for Amazon and any cities willing to play.
- trgv 9y agoI feel like you missed my point. I'm not saying this is good or that it should continue. I'm saying that, in the context of the world as it exists today, if I am the mayor of Boston, it will benefit my city to offer Amazon tax breaks to entice them to build there.