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> 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

• 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.
      • rosser 8y ago
        You don't see any growth in the local economy that would result from HQ2-A (or is this one -B?) as an "economic [or social] policy" worth supporting, for its own sake, or that it's not somehow "advantageous to the public", under the kind of thinking that uses tax breaks to lure corporations like this? The "greater good" under discussion is, IMO, the "rising tides lift all boats" notion that (at least some of) the people behind this policy believe will result from it. That's not charity; it's "optimizing revenue in the long term". It's purely about "bringing in more money". EDIT: Not to say I subscribe to this theory, personally, but that's my understanding of the motivations in play. Now, if you'll excuse me, I have far more productive things to do with my time than to keep going in circles here.
        • 8y ago