Blocking Amazon's New York Deal Doesn't Help Anyone
Rep. Alexandria Ocasio-Cortez, who for the moment represents a New York congressional district -- tomorrow the world! -- opposes Amazon's plan to locate one of its two satellite campuses in the Queens neighborhood of Long Island City. Amazon promises more than 25,000 jobs. Ocasio-Cortez tweeted her intention to stop what she calls the "creeping overreach of one of the world's biggest corporations." As for the people who might have gotten those new jobs, let them eat tweets.
AOC, as she has become known, is hardly alone in her opposition. The stop-Amazon movement is being led by a state senator named Michael Gianaris, who was recently appointed by his colleagues to one of those state commissions that seem to surface whenever something good is about to be done. This one, the Public Authorities Control Board, has the power to nix the deal -- Gov. Andrew Cuomo and New York City Mayor Bill de Blasio be damned. They both support bringing Amazon to Queens.
In truth, they offered Amazon more than support. They promised around $3 billion in incentives -- tax abatements and the like. It is this figure that sticks in the craw of Ocasio-Cortez and others. They ask why the city of New York should be offering such a nice package to one of the world's richest corporations, headed, as you all know, by the world's richest man, Jeff Bezos. (Bezos also owns The Washington Post.)
This is a good question to which the quick answer is that life is not fair. Should you not know this, I am here to tell you that celebrities -- even minor ones -- get free clothing from stores or manufacturers who want their brands to be seen on the (often) very rich and the (sometimes) barely famous. This practice is hardly fair, and it pales in comparison to the Amazon deal, but it is deeply American. In this country, you can negotiate anything.
And so Amazon negotiated. It asked cities to make offers, and 238 did. Some didn't stand a chance, and their offers cost them money in time and effort, but Amazon never said, "Don't bother." In the end, New York and Crystal City, Virginia, won out. Crystal City is right across the river from Washington, and Long Island City is right across the river from Manhattan.
River views were not, however, the only inducement. Instead, it was more likely the taxes Amazon was going to save. The company might be rich, but so are many of the others who in recent years have struck similar deals. The Atlantic magazine published a dandy article on this matter. According to the magazine, Boeing, Nike, Intel, Royal Dutch Shell, Tesla, Nissan, Ford and General Motors received subsidies worth at least $1 billion each either to move or stay where they are. In exchange, of course, they promised jobs and, I imagine, the occasional school or park. (Amazon offered all three.)
As Ocasio-Cortez implies, just because the practice may be widespread doesn't make it right. I agree. The Atlantic article, in fact, argues that it ought to be outlawed. Right again. Doing so, however, raises constitutional issues involving the Commerce Clause. Still, Congress might jigger with the tax code to make billion-dollar inducements less valuable. Or, as The Atlantic article suggests, a president could use what was once known as moral suasion to make the corporations look cheap and sleazy.
In the meantime, though, simply blocking the Amazon deal is going to do no one any good. Those 25,000 promised jobs are not minimum-wage ones -- we're talking an average of $150,000 a year. In addition, Amazon is going to need more than geeks and nerds -- custodial and security come to mind. Maybe most valuable of all is the effect such a move would have on the community and the city. Rents would rise, probably, and housing would become more expensive, probably, but the area would be enriched not just with affluence but with intellectual and cultural vigor. As Pablo Picasso and Georges Braque knew, being in the same city (Paris) afforded them the opportunity to learn from each other.
New York will survive the loss of Amazon, should Ocasio-Cortez get her way. And people who do not yet have the new jobs will not miss them. But as is now clear, the movement to kill the Amazon deal is not wholly based on the current quid pro quo, but on an antipathy toward capitalism that is rampant on the Democratic Party's left. If these people get their way, Amazon will simply go somewhere else. Ocasio-Cortez, given her genius for publicity, will not.
(c) 2019, Washington Post Writers Group