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1. $3B in "incentives" sounds like a lot, but would this have been a good investment? i.e. would the city and State have gotten a reasonable return in the long

1. $3B in "incentives" sounds like a lot, but would this have been a good investment? i.e. would the city and State have gotten a reasonable return in the long run? 2. New York already has a lot to offer in terms of labor market, real estate for employees, and access to capital markets. Did Amazon really need incentives to want to be in NYC? 3. No huge loss for either party. NYC doesn't need Amazon, and Amazon can make the little people dance for them somewhere else.

larrydag 8y ago
Concerning 1. I believe that is often overlooked. It would not be hard (I suspect) to figure out the future effective tax revenue a municipality would receive.
- moate 8y ago
  Also, being a positive gain doesn't represent a good deal. We don't know what the lowest deal was that Amazon might have accepted (2 Billion? 1 Billion?) so even if NYC winds up in the black, they might have been leaving hundreds of millions of dollars on the negotiating table. It's just like anything, you might benefit from the price you pay but you might have been able to get it cheaper.
shaki-dora 8y ago
It isn’t about the net loss or win for NY. The problem with subsidies is that they needlessly cost money in a zero-sum competition between cities. It was always clear that Amazon would build somewhere. A race to the bottom competition over the exact location leaves everyone but them worse off than the alternative, which is coordinating to refuse to engage in it, like any sane economy like the EU does.
- jumbopapa 8y ago
  It's almost like there is a demand for Amazon to have a presence in the community.
  - hannasanarion 8y ago
    Demand and price are not the same thing unless both sides have perfect information. The fact that Amazon ran a secret auction for their HQ2 compelled New York to overspend, for fear of missing out.
blankley 8y ago
Regarding #1, see this from an Amazon release: As part of Amazon’s new headquarters, New York and Long Island City will benefit from more than 25,000 full-time high-paying jobs; approximately $2.5 billion in Amazon investment; 4 million square feet of energy-efficient office space with an opportunity to expand to 8 million square feet; and an estimated incremental tax revenue of more than $10 billion over the next 20 years as a result of Amazon’s investment and job creation.

larrydag 8y ago

Concerning 1. I believe that is often overlooked. It would not be hard (I suspect) to figure out the future effective tax revenue a municipality would receive.

moate 8y ago
Also, being a positive gain doesn't represent a good deal. We don't know what the lowest deal was that Amazon might have accepted (2 Billion? 1 Billion?) so even if NYC winds up in the black, they might have been leaving hundreds of millions of dollars on the negotiating table. It's just like anything, you might benefit from the price you pay but you might have been able to get it cheaper.

shaki-dora 8y ago

It isn’t about the net loss or win for NY. The problem with subsidies is that they needlessly cost money in a zero-sum competition between cities. It was always clear that Amazon would build somewhere. A race to the bottom competition over the exact location leaves everyone but them worse off than the alternative, which is coordinating to refuse to engage in it, like any sane economy like the EU does.

jumbopapa 8y ago
It's almost like there is a demand for Amazon to have a presence in the community.
- hannasanarion 8y ago
  Demand and price are not the same thing unless both sides have perfect information. The fact that Amazon ran a secret auction for their HQ2 compelled New York to overspend, for fear of missing out.

blankley 8y ago

Regarding #1, see this from an Amazon release: As part of Amazon’s new headquarters, New York and Long Island City will benefit from more than 25,000 full-time high-paying jobs; approximately $2.5 billion in Amazon investment; 4 million square feet of energy-efficient office space with an opportunity to expand to 8 million square feet; and an estimated incremental tax revenue of more than $10 billion over the next 20 years as a result of Amazon’s investment and job creation.