4 ms·

Comparing a landlord, which only represents the owners' interests, to the state, which represents all taxpayers', doesn't make sense.

deleted 8y ago
[deleted]
manfredo 8y ago
In a sense, the state is the landlord of all the residents of the state. The state provides services to the people, and in return the people pay rent (taxes) to the state. This is not directly related to the point I'm making though: the point of these tax deals is not to help Amazon's business (though that is likely a side effect). The point of these deals were to entice Amazon to set up shop in that location. Thus, it is better to call these deals incentives rather than subsidies.
- rosser 8y ago
  > Thus, it is better to call these deals incentives rather than subsidies. Note the added emphases: "A subsidy or government incentive is a form of financial aid or support extended to an economic sector (or institution, business, or individual) generally with the aim of promoting economic and social policy." [0] "a grant by a government to a private person or company to assist an enterprise deemed advantageous to the public" [1] "A subsidy is a benefit given to an individual, business or institution, usually by the government. It is usually in the form of a cash payment or a tax reduction." [2] I don't think there's nearly as bright a line between "subsidy" and "incentive" as you're trying to paint here. [0] https://en.wikipedia.org/wiki/Subsidy https://en.wikipedia.org/wiki/Subsidy [1] https://www.merriam-webster.com/dictionary/subsidy https://www.merriam-webster.com/dictionary/subsidy [2] https://www.investopedia.com/terms/s/subsidy.asp https://www.investopedia.com/terms/s/subsidy.asp
  - manfredo 8y ago
    This isn't financial aid since Amazon isn't short on cash. It also isn't promoting any economic or social policy (unless people see e-commerce and cloud computing as a social policy, which seems far fetched). So it at least fails the first definition. Perhaps a better way to put my underlying idea into words is that these cities are still acting in their own self interest. Much like a dealer offering a few grand off sticker price, these cities are making a concession to Amazon but are still acting in their own self interest because they would be making even less money if Amazon decided to set up shop somewhere else. "Subsidy" often as the connotation of being something charitable to advance some social policy. These cities aren't being charitable to Amazon. They're acting in their own self interest by making themselves economically competitive. Much like the dealer accepting a lower price, they're accepting a lesser payment but the alternative is not making a sale at all. Sure, an argument could be made that Amazon would have chosen NY or DC with a smaller incentive - but that's more of a hypothetical criticism of the government's negotiations rather than the act of offering incentives in and of itself. This is distinct from something like offering a subsidy to buy electric cars. This is a scenario where the government is making a sacrifice in order to promote an environmental benefit.
    - rosser 8y ago
      You seem to be asserting the unsubstantiated, and until now implicit premise that "subsidies" are necessarily somehow "charitable." I don't find that to be at all supported, whether in the literature, in the behavior, or in your argument. EDIT: That is to say, a "subsidy" can absolutely be used to serve the subsidizing party's interests, as you describe, alongside, or even over the subsidized party's. Charity is an orthogonal question.
      - manfredo 8y ago
        Two of your 3 definitions specified that subsidies are characterized by having the aim of promoting some sort of "social policy" or something "advantageous to the public". In my view, this means subsidies are "charitable" insofar as they are making a monetary sacrifice to promotr some sort of greater good, be it environmental (like green energy subsidies) or social justice (like grants to minority or women owned businesses) or something else. I don't think any of the public officials framed these tax incentives to Amazon of having any sort of "social policy" or anything of that sort. They seemed to have been offered with the explicit goal of optimizing revenue in the long term, not trying to advance any sort of social good beyond bringing in more money.
- bassman9000 8y ago
  All those taxes not paid by Amazon will have to be paid by someone else, because the services, from roads to hospitals, will surely be used. As per the argument > the Amazon employees will increase tax revenue Will they? When every and each of their meals is subsidized? Where their transportation, their gym membership, even their kids' school is paid for? And Amazon pays almost nothing in taxes itself [0] So, yeah, it's a subsidy, maybe not in cash, but in free city services. [0] https://itep.org/amazon-inc-paid-zero-in-federal-taxes-in-2017-gets-789-million-windfall-from-new-tax-law/ https://itep.org/amazon-inc-paid-zero-in-federal-taxes-in-20...
  - manfredo 8y ago
    Softeware development isn't exactly heavy industry. It's not known for incurring significant burden on government services. Not to mention, the demographics that disproportionately make up tech companies (younger wealthier people, with higher rates of childlessness) tend to contribute a lot more in taxes than they consume. Remember, even if Amazon itself is paying less corporate taxes, their employees are still paying state and local taxes.

deleted 8y ago

[deleted]

manfredo 8y ago

In a sense, the state is the landlord of all the residents of the state. The state provides services to the people, and in return the people pay rent (taxes) to the state. This is not directly related to the point I'm making though: the point of these tax deals is not to help Amazon's business (though that is likely a side effect). The point of these deals were to entice Amazon to set up shop in that location. Thus, it is better to call these deals incentives rather than subsidies.

rosser 8y ago
> Thus, it is better to call these deals incentives rather than subsidies. Note the added emphases: "A subsidy or government incentive is a form of financial aid or support extended to an economic sector (or institution, business, or individual) generally with the aim of promoting economic and social policy." [0] "a grant by a government to a private person or company to assist an enterprise deemed advantageous to the public" [1] "A subsidy is a benefit given to an individual, business or institution, usually by the government. It is usually in the form of a cash payment or a tax reduction." [2] I don't think there's nearly as bright a line between "subsidy" and "incentive" as you're trying to paint here. [0] https://en.wikipedia.org/wiki/Subsidy https://en.wikipedia.org/wiki/Subsidy [1] https://www.merriam-webster.com/dictionary/subsidy https://www.merriam-webster.com/dictionary/subsidy [2] https://www.investopedia.com/terms/s/subsidy.asp https://www.investopedia.com/terms/s/subsidy.asp
- manfredo 8y ago
  This isn't financial aid since Amazon isn't short on cash. It also isn't promoting any economic or social policy (unless people see e-commerce and cloud computing as a social policy, which seems far fetched). So it at least fails the first definition. Perhaps a better way to put my underlying idea into words is that these cities are still acting in their own self interest. Much like a dealer offering a few grand off sticker price, these cities are making a concession to Amazon but are still acting in their own self interest because they would be making even less money if Amazon decided to set up shop somewhere else. "Subsidy" often as the connotation of being something charitable to advance some social policy. These cities aren't being charitable to Amazon. They're acting in their own self interest by making themselves economically competitive. Much like the dealer accepting a lower price, they're accepting a lesser payment but the alternative is not making a sale at all. Sure, an argument could be made that Amazon would have chosen NY or DC with a smaller incentive - but that's more of a hypothetical criticism of the government's negotiations rather than the act of offering incentives in and of itself. This is distinct from something like offering a subsidy to buy electric cars. This is a scenario where the government is making a sacrifice in order to promote an environmental benefit.
  - rosser 8y ago
    You seem to be asserting the unsubstantiated, and until now implicit premise that "subsidies" are necessarily somehow "charitable." I don't find that to be at all supported, whether in the literature, in the behavior, or in your argument. EDIT: That is to say, a "subsidy" can absolutely be used to serve the subsidizing party's interests, as you describe, alongside, or even over the subsidized party's. Charity is an orthogonal question.
    - manfredo 8y ago
      Two of your 3 definitions specified that subsidies are characterized by having the aim of promoting some sort of "social policy" or something "advantageous to the public". In my view, this means subsidies are "charitable" insofar as they are making a monetary sacrifice to promotr some sort of greater good, be it environmental (like green energy subsidies) or social justice (like grants to minority or women owned businesses) or something else. I don't think any of the public officials framed these tax incentives to Amazon of having any sort of "social policy" or anything of that sort. They seemed to have been offered with the explicit goal of optimizing revenue in the long term, not trying to advance any sort of social good beyond bringing in more money.
bassman9000 8y ago
All those taxes not paid by Amazon will have to be paid by someone else, because the services, from roads to hospitals, will surely be used. As per the argument > the Amazon employees will increase tax revenue Will they? When every and each of their meals is subsidized? Where their transportation, their gym membership, even their kids' school is paid for? And Amazon pays almost nothing in taxes itself [0] So, yeah, it's a subsidy, maybe not in cash, but in free city services. [0] https://itep.org/amazon-inc-paid-zero-in-federal-taxes-in-2017-gets-789-million-windfall-from-new-tax-law/ https://itep.org/amazon-inc-paid-zero-in-federal-taxes-in-20...
- manfredo 8y ago
  Softeware development isn't exactly heavy industry. It's not known for incurring significant burden on government services. Not to mention, the demographics that disproportionately make up tech companies (younger wealthier people, with higher rates of childlessness) tend to contribute a lot more in taxes than they consume. Remember, even if Amazon itself is paying less corporate taxes, their employees are still paying state and local taxes.