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If Amazon had just quietly announced plans to expand to LIC without the "HQ2 Search" dog and pony show they almost certainly would still be here. Google buys e
by zelias 8y ago
If Amazon had just quietly announced plans to expand to LIC without the "HQ2 Search" dog and pony show they almost certainly would still be here.
Google buys entire city blocks and nobody bats an eye. Turns out that publicly shaking down cities across the US tends to draw out the opposition.
More publicity = more scrutiny = more angry opponents of your business decision
- weliketocode 8y agoTheir dog and pony show almost netted them $3bn. That type of payday might be worth a bit of scrutiny.
- vonmoltke 8y agoNo it didn't. The vast majority of those incentives were on the table for Amazon, or anyone else, without the theatrics.
- null000 8y agoOh, sorry, it was "only" 1/2 a billion that was specially on the table for Amazon (if up thread comments are to be trusted) That's not peanuts.
- vonmoltke 8y agoI never said it was, or that it in itself wasn't a problem. It's far less than $3B though, so anyone talking about billions specifically for Amazon is wrong. Also, if your problem is large tax breaks for corporations, the focus should be on those programs that make available the other $2.5B available, since any corporation with a similar scale project could get that. Focusing specifically on Amazon distracts from the existence of these programs and whether that existence is a good idea. As an aside, your snarky tone detracts from your comment and hurts the discourse.
- digianarchist 8y ago>Turns out that publicly shaking down cities across the US tends to draw out the opposition. Unless it's for a football stadium.
- mc32 8y agoThis is true, but sadly it’s democratic and lots of fans turn out in support. I don’t get it, but that’s probably because I’m not a pro sports fan.
- billman 8y agoIs it just a coincidence that the Giants and Jets both play in New Jersey. Maybe Amazon should just move across the river and call it the New York office.
- sethhochberg 8y agoThis was one of the common critiques of the LIC HQ2 plan - LIC doesn't _need_ Amazon to continue redeveloping well, but a nearby city like Newark gets access to the same talent pool and a big anchor tech campus could do a lot more good there. If you're gonna throw tax incentives around, it seems prudent to do the most good with them. (Granted, Newark is in NJ... and the proposed tax deal was from NY. Thinking as adjacent states instead of a region bites.)
- JohnFen 8y ago> Unless it's for a football stadium. You haven't seen the perpetual and energetic fights in my part of the nation about public funding for football (and other professional sports) stadiums. Sports businesses trying to get tax money to be spent in order to enhance their profitability is absolutely something that brings out the opposition.
- humanrebar 8y agoCorrect. St. Louis and San Diego both let pro football clubs leave recently.
- jhall1468 8y agoGoogle doubled their occupancy to 7k. Amazon was promising 25k jobs. I'm stunned out how so many people in this thread are pretending thats equivalent.
- joshuamorton 8y agoYou've got something confused here. Google's current occupancy in NYC is >7K. They were/are planning to more than double that to ~20K. So it's absolutely an expansion of a similar scope.
- YeahSureWhyNot 8y agoempty promise is useless. did they sign a contract saying if they hire 1 person less than 25k and their average salary is 1 dollar less than 150k by certain time then they will refund all tax breaks? when bezos signs that contract then I would believe this.
- ctvo 8y agoTheir entire deal, which was released with the initial announcement, is predicated on them creating those promised jobs and building those promised buildings. There are benchmarks along the way and all the incentives are based on meeting those benchmarks. In short, yes, they would have signed a contract stating that.
- siruncledrew 8y agoAmazon's spectacle reminds me of Lebron's "The Decision". It's one thing to work out the details and make an announcement, but to purposefully turn it into a show about "What can you do for me?" instead of "Here's what I can do for you" made it not sit well with people. Also, the pull-out letter also basically dumps the blame on state/local officials for not wanting Amazon, despite not all stakeholders being present at the table when discussions started.
- mav3rick 8y agoLeBron's Decision 1 was a lot of money for him. He had the talent to back that up.
- jfnixon 8y agoAnd the company that owns vast swaths of cloud computing space doesn't have talent to back it up? Amazon is way more dominant than LeBron in their respective businesses.
- will_brown 8y agoI don’t know about having more talent, but amazon definitely has more ego...At least LeBron didn’t demand special tax deals and non-public data from cities to bring his talents.
- dagoat 8y ago> At least LeBron didn’t demand special tax deals and non-public data from cities to bring his talents. As is common with other, bigger ego, basketball players
- joejerryronnie 8y agoNo, Lebron just demands the coach be fired, management take on horrible contracts for Lebron's buddies, and all organizational decisions be run by him. Truly, Lebron's lack of ego is staggering.
- jcfrei 8y agoExactly, this was a huge communication error on Amazons and the politicians' side. Offering such huge subsidies to a single company will never go down well in the current political landscape - especially not in a city with a resurgent left.
- koheripbal 8y ago> not in a city with a resurgent left. IRRATIONAL left. This investment on the part of Amazon gave way way way more to the city than it got back in subsidies. It's kind of ridiculous. If I were Amazon, I would drop NYC in a heartbeat if they didn't appreciate that degree of investment. The subsidies were 1.525 billion. Amazon's investment was expected to be around 2.5 billion. Only an irrational fool cannot do that math.
- DisposableMike 8y agoSubsidies are paid out of tax dollars. Surely you're not arguing that Amazon's 2.5 billion investment will go straight back to the city's coffers? It would generate property tax (if not abated) and income tax for the workers (both hired after the fact, and hired to complete the construction), but at what percentage of the total investment? 10-20%?
- lordnacho 8y agoThis is only irrational in a narrow accounting sense, and even then only if you believe in the numbers turning out as purported. You are considering a simple one-time game of "give me this and I'll give you that". What is the long term effect of having government hand out money to every business that creates a hype? What is the effect of the amount of similar deals that will inevitably get hyped? Should you play the game at all? Is it reasonable for someone to come along with this kind of deal? Is there no sense of fair play - that all corporations should be treated equally - whose logic is outside of the simple arithmetic? The simple arithmetic that you are suggesting can potentially lead to unpleasant situations. What if the opposite were to happen? Supposed some big firm like Google decided to ask the government for money, or else they leave and sack every employee who doesn't want to go to their new location? You could have firms queueing up to present you with new math problems.
- tanilama 8y agoYeah, professional protesters are a thing. It is not even NIMBY any more, it is anti whatever development. Especially in a ultra-leftist city like NYC, where in their mainstream political disclosure, business reads as sin.
- a13n 8y ago> Turns out that publicly shaking down cities across the US tends to draw out the opposition. Unless you're Elon, then it's celebrated.
- doublescoop 8y agoI think you're misreading Musk's reputation outside of tech circles. If they're aware of him at all, he's more or less viewed as a Bond villain at this point.
- tytso 8y agoThe opposition is not because some high tech firm, whether it is Google or Amazon, is expanding in NYC. The opposition is because of the Massive tax breaks and other $$$ giveaways New York was going to hand over to Amazon. I don't recall Google extorting NYC for $$$ before they decided to expand....
- r_smart 8y agoBut they probably did. It was just behind closed doors rather than publicized.
- Wowfunhappy 8y agoPlease correct me if I'm wrong, but I'm pretty sure any such tax breaks would have to be public data by now, even if they were originally hashed out behind closed doors. If you're implying that Google got tax breaks, and no one noticed the public data confirming these tax breaks, please provide evidence of the data that has been overlooked.
- heyjudy 8y agoAss and umption.
- SolarNet 8y ago> would have to be public data by now Show me the public data source where I could conceivably find that out and I'll do "please provide evidence of the data that has been overlooked". Because I don't think that data source exists. I don't think you realize how opaque tax records are in many places. You seem to be implying that there is a way for the public - or even journalists - to acquire the tax and assessment information of individual companies. Attempting to do so is considered fraud in most jurisdictions (e.g. attempting to use a FOIA request for the personal information - including tax records - of someone else or a business of which you are not an officer).
- hopler 8y ago
- driverdan 8y ago> Google buys entire city blocks and nobody bats an eye. Was it highly subsidized by taxpayers like Amazon's purchase would have been?
- koheripbal 8y agoTax breaks are just a temporary discount on taxes that otherwise would be paid at all. It's not like Amazon was getting CASH to move to NYC.
- jamiek88 8y agoThat’s assuming that space would be left empty. Which in NYC is unlikely.
- lamarpye 8y agoI guess time will tell. We can track how long it takes for another company or companies to develop the same properties. Hopefully it will be less time than the length of the tax breaks
- Nav_Panel 8y agoHave you been to Long Island City? It's low-slung warehouses and taxi parking lots.
- mjfl 8y agoYou're also assuming that the people who will take Amazon's space wouldn't have moved to some other place in NY or built a bigger building.
- pertymcpert 8y agoNo they are not.
- KorematsuFred 8y agoA sheriff of a small town told me how they ended up spending thousands of dollars to SWAT team which he thinks he will never use. The reason ? After some school shooting in another end of USA the folks of his county wanted to know how their LEAs plan to defend the local schools. The correct response here was that they do not expect such law probability even and even if it happens there is very little they can actually do. But public does not like it and hence they had to put together a fake plan and waste money. Which could have otherwise gone into preventing real crimes.
- ben509 8y agoHonestly, it's a bit like a doctor giving someone a sugar pill.
- r00fus 8y agoExcept it's a vulnerability to SWATings. Also the cost acquisition and maintenance is non-negligible. More like it's a sugary pill that gives you diarrhea that also does nothing useful.
- JohnFen 8y agoOne difference is that sugar pills can actually be very effective.
- asah 8y agoand don't cost $$$ (unless that's important for the placebo effect!)
- baddox 8y agoA doctor giving someone a sugar pill and telling them it’s an active ingredient is definitely illegal. Placebos are used in medical studies where the patients know that they might be receiving a placebo.
- bko 8y agoMost new Yorkers supported the project even when told about the subsidies. It's a vocal minority that sank the project https://www.wsj.com/articles/majority-of-new-yorkers-support-amazon-project-in-queens-new-poll-shows-11549967400 https://www.wsj.com/articles/majority-of-new-yorkers-support...
- jcranberry 8y agoHow about New Yorkers who lived in Queens?
- sammycdubs 8y agoI live in LIC and I've not met anyone who supported it, especially the $3BN of incentives. No wonder Gianaris, who represents our district in the NY Senate, was such a strong opponent.
- rhegart 8y agoMajority of the incentives are from Amazon’s taxes. 27B in economic activity for 3B in tax breaks for just 10 years is wayyy better than almost every other corporate deal. Better than Tesla for sure. That 3B will no longer be generated. You want a net 24B or a net 0B? New Yorkers chose 0
- wolco 8y agoOther businesses can move into those spaces and will end up paying more in taxes. Property values will go up slower. Having one company move in sounds great but diversity might be a better longterm strategy.
- smsm42 8y ago> Other businesses can move into those spaces and will end up paying more in taxes The first is likely, the second is very unlikely. For the simple reason that Amazon would not plan such project in a market that is so hot that is able to generate tax income at the same rate as concentrated investment project of the Amazon HQ size. Surely, it won't turn into a barren wasteland, but I would not expect it to produce more in tax revenue than big development like Amazon HQ would.
- tom-_- 8y agoBut because the dog and pony show draws more public scrutiny, is that not a better, more transparent process for the tax payers vs the norm of corporations "quietly" making deals with city governments? If Amazon required all bids and contracts be made public AND brought in the media circus to invite scrutiny that would seem to be the most in the public interest.
- skookumchuck 8y ago> shaking down Shaking down someone for money is done by threatening them, i.e. extortion. Amazon did not threaten NYC, and therefore it is not a shakedown.
- gdilla 8y agoLIC and Queens was more resistant to hipster techbros than say, Chelsea. Manhattan is already a playground for the rich, lower manhattan even more so. LIC was justifiably worried about tax payer subsidized gentrification.
- philwelch 8y agoIt worked out for Amazon. The biggest goals of HQ2 were to get around barriers to further growth and development in Seattle and to hedge against the risk of further populist backlash in Seattle. The fact that a populist backlash in New York happened so suddenly demonstrated that NY suffers the same afflictions as Seattle.
- tanilama 8y agoPretty on point. Amazon is pretty decided to step aside those toxic politics, that is why I am surprised they choose NYC in the first place, because the climate there isn't that different from Seattle. Well, it turns out to be rather quick running into its conclusions. Fun ride.
- ausjke 8y agoyes Amazon ruined the show itself, it feels too proud about itself these two years probably.
- seppin 8y agoAmazon still plans to dramatically expand it's workforce in NY/NJ. Im not sure what the point of any of this was.
- smsm42 8y agoFrom what I heard, Google also doesn't get the kind of deals with tax breaks that Amazon did. Amazon wanted to leverage their added value (which is clearly existing) into some benefits. That did not work in this case, but it wasn't at all obvious it won't. Majority of New Yorkers supported the deal, as it was. Also, "nobody bats an eye" is not right either - there are tons of protests against Google, which has been widely reported. They just didn't have a focus point like Amazon did, but if any city had a wide contingent of young socialist politicians caring about PR much more than for the jobs for the city population - the same could happen to Google too.
- chrischen 8y agoThe issue are the concessions, not necessarily the actual building of the HQ.
- codyb 8y agoI think it's the fact Google got no tax breaks (as far as I know) to do so.
- stefek99 8y agoAbout Google and Berlin: https://www.nytimes.com/2018/10/25/world/europe/google-berlin-kreuzberg-campus.html https://www.nytimes.com/2018/10/25/world/europe/google-berli...
- lazerwalker 8y agoI mean, they're still doing that. Amazon is still planning on staffing up their existing NY offices, just to the tune of 5k new jobs instead of 25k. The big dog and pony show was about asking for major tax benefits. They're still welcome to open a giant LIC office, they just won't get showered with a tax windfall for it. That's Amazon's decision that it wasn't worth it.