Seattle officials repeal tax on large companies
nytimes.com
nytimes.com
I had fully expected that the EHT would be repealed by ballot initiative come November, but didn't expect that the city council would just sort of roll over and repeal it.
Erica Barnett, a local journalist, has a far more insightful look at what actually happened here than the somewhat superficial look the NYT provides: https://thecisforcrank.com/2018/06/12/todays-head-tax-defeat...
From TFA
"Is this really all about Amazon?
No, but you’d be forgiven for thinking it was. Council member Kshama Sawant, who exhorted her supporters to “Pack City Hall!” in a mass email yesterday, has consistently characterized the head tax as a “tax on Amazon” and Jeff Bezos, whom she described earlier today as “the enemy.”
Demonizing individual corporations is rarely a path to building broad community coalitions, and that’s especially true when that corporation is Amazon, whose name many Seattleites (rightly or wrongly) consider synonymous with “jobs.” This is one reason head tax opponents were able to so easily spin the head tax as a “tax on jobs,” and to get ordinary citizens to gather signatures against a tax that would really only impact the city’s largest corporations."
That seems like bad politics. Isn't it politics 101 to anticipate that the affected parties (here Amazon and Starbucks) would push back? And if enough political support to overcome this hasn't been built up in the first place, why would someone try passing the head tax at all? This is like playing chess looking only one move ahead.
I don't get it.
Help me understand?
(Due Disclosure: Not a US citizen, nor a Seattle resident, I don't have a position, pro or anti, on the tax measure itself)
Also, the fact that it was a tax for every employee. If you want to encourage companies/people to do something (like hire people), you normally start by not adding extra taxes to that.
Not that adding tax is always a bad thing, but the mechanism of this one was pretty poorly thought out.
The stupidity was that it was a flat, $500 tax, which is not a big deal if you're paying your tech bros six figures, but becomes quite a big deal if you have a lot of minimum-wage earning grocery baggers (who were among the professions and corporations that would've been most impacted)
It was also targeted at the top 3% of companies or something.
This was a paltry tax. If you want to convince me otherwise I want hard numbers, not "oh but the low profit minimum wage employers".
.9% is not a trivial tax increase. If sales taxes went up by .9%, that would be an undue burden on the poor. And a flat $500 head tax is more regressive than even a flat percentage tax on sales; making it only apply to the top X companies doesn't stop it from being regressive.
Now it’s property or sales tax. Hurray.
https://en.wikipedia.org/wiki/Socialist_Alternative_(United_...
[1] https://www.documentcloud.org/documents/4461445-Wfre-Seattle...
A years long process won’t do anything to help thousands of homeless now.
2. Rents increase.
3. More people become homeless.
http://q13fox.com/2017/11/06/study-says-rising-rents-tied-to...
What do you think the underlying cause of homelessness in Seattle is?
Homeowners are a reliable voting bloc. Rezoning single homes would make housing more affordable while adding to the city's vibrancy. It would also reduce existing home values.
I'm not an american so I probably don't get the real estate market in the US. But wouldn't rezoning actually increase the value ? Not of the home itself but of the land on which it is built.
If your $1M home can be turned into a 10-flat building at $300K each, wouldn't real-estate developers buy your home (even at a premium) to destroy it and rebuild on it ?
Let this happen ten times and you have 100 new units on the market. Since nobody moves to a city to live in a particular building (i.e. housing demand, locally, is relatively independent of housing supply, at least in the short run) this will drive the apartments' prices down. That, in turn, will exert downward pressure on the price of the single-family homes.
This is an unfair framing. The tax did far more damage than impair Amazon's bottom line. Your complaint, moreover, could be leveled against every public service in the city. There are simply better ways to solve this problem. Seattle's government chose pot shots over progress.
This tax was predominantly opposed by small business owners. (I think it was $25,000 donated by Amazon and close to $300,000 by small businesses.)
The proposed tax was a flat payroll tax. That burdens lower-wage employees and employers much more than tech companies. There is perfect being the enemy of good, and then there is cutting off the nose to spite the face. This was the latter.
It really didn't though.
I don't want them tackling civic issues because Amazon is a company. It is a profit algorithm in a capitalist system. Humans inside can steer it to Do Nice Things here and there but ultimately its lives because Profit.
The government's ONLY job is to Do Nice Things (maintain nice status of life). Therefore, it is the government's failure to leverage its own powers to solve the homeless issue. Because it's a representative plutocratic democracy, the people are partially to blame as well, although class disparity is a major obstacle.
1. Amazon is not the government.
2. Amazon has no obligation to solve civic issues.
3. It is the government's job to solve civic issues.
(The government tries to solve civic issues; Amazon uses its undue influence in Seattle to undermine the process.)
4. Ergo, it's all the government's fault.
I say instead, attack the concept of capitalism (infeasible) or fight the fight in the battleground of the political sphere - vote and openly support candidates that want money out of government.
Yea, finding one is hard, I agree.
But rather than accepting Amazon's mundane corporate naughtiness, we should be vigilant and outspoken about it. The corporate norms we have now in North America are not etched in stone; we can inveigh against shitty behaviour while also doing what you suggest: electing better politicians and pursuing fairer tax policy.
If you're an affluent techie in Seattle it's easy to say "not my problem bro", work your great job, buy your expensive house, lobby your local councilman to curb new developments and head taxes, watch your property value rise and your chequing account blossom. But there are swathes of other people for whom affluent tech jobs aren't desirable or possible, and there's no need for those people to be priced out of Seattle. Building homes isn't hard.
Is the solution to be companies to throw their hands up in the air and say "municipal governments can't solve gentrification, so let's not become big"?
Do you think the swaths of tech workers moving to be close to work enjoy their rent prices skyrocketing? Do you think they enjoy rising homeless rates?
Nobody wants gentrification. If you can find me a tech worker kicking sand in a homeless person's face I'll lambast him with you. I want to solve gentrification as well but the solution isn't to choke an economy to prevent companies from moving in. That just pushes the problem to some other city. We need the government to step in and do its job, and that means we have to participate and steer the government.
Plus government spending here like many other cities is not well managed. See bike lanes. See the fact that they fired Wells Fargo and then re-hired Wells Fargo because no one else would take their business.
Homelessness is a real problem, but there needs to be more dialogue and better planning before rushing in and taxing growth.
Probably a better idea to look at how the tax system is setup here to favor the wealthy versus low income.
Just salary, not even the full cost of having an employee on staff.
I just refuse to believe this is a massive burden on these businesses without numbers.
People said the same stuff about the minimum wage increase.
> Probably a better idea to look at how the tax system is setup here to favor the wealthy versus low income.
They did and that's why they decided on this tax instead of yet more horribly regressive sales taxes.
Washington has a god awful tax system. This is one of the options they had to get the money without squeezing the poor and middle class even more.
> Teresa Mosqueda, one of the two council members opposing the repeal, said there was no backup plan for dealing with the homeless situation.
There was no plan, period. The plan consisted of 1. Tax Amazon, 2. ..., 3. Get re-elected. When they realized 3 didn't follow from 1, they started grasping at straws.
Great example here of managed democracy. https://en.wikipedia.org/wiki/Guided_democracy
Immediately concluding that because a government didn't pass a new tax, the government is a de-facto autocracy is extremely reductive.
They repealed it a day after the announcement that they were doing so.
Seattle is a company town now.
Oh really?
http://www.capitolhillseattle.com/2018/05/up-against-a-wall-...
Not a perfect plan, maybe not even a particularly good one, but there absolutely were plans and budgets for how the money could have been used even before it was originally approved.
That doesn't even make sense, how is blackmail involved?
You may not agree with a tax, but that's what voting is for. If it passes, you pay it or you remove yourself from the jurisdiction...that's not blackmail, it's how taxes work.
Hopefully that move is to somewhere close by; else, that kind of black-and-white logic would directly result in 45,000 Amazon employees facing either relocation or unemployment. Even then, the added time and monetary costs of added commutes can put folks in a similar "between-rock-and-hard-place" scenario.
In general, telling someone "if you don't like it, then move somewhere else" betrays a complete ignorance of the economic and psychological burden of doing so (burdens which not everyone can afford). Amazon itself can afford to move with relative ease, of course, but that doesn't hold true for the vast majority of its workers.
If anyone was engaging in extortion it was Amazon.
Powerful companies who can communicate one single message backed by advertising/public appearances/media can make it appear that are no other "real" options. This is a deliberate political strategy.
The reality is that there are an enormous amount of "real" options. But political will is hard to muster when there are many competing ideas as to what should be done.
Without a doubt gentrification, homelessness, and housing/rental prices can all be addressed from many directions. I have my own ideas about what can be done by the city, state, and country. To say "there was no plan, period" is literal propaganda that exists to support the status quo.
I'm extremely frustrated by the seeming tolerance for literal shit in the streets. At least put some porta-potties out for public health. If it only costs $300k for laundry, showers, toilets, and sinks (according to the plan linked in the other comment) why hasn't it been done yet?
That's funny xapata. The Seattle City Council has been implementing recommendations from the Poppe report [0]. The Poppe report lays out a homelessness action plan recommendations for Seattle. The head tax was to fund some of those recommendations from the Poppe report.
The Seattle Times recently covered the homelessness count [1]. It explicitly mentioned that actions Seattle has taken to combat homelessness were having a positive effect.
> Compared to more rapid rises in homeless counts over the past five years, a slower 4 percent increase represents progress, said Kyra Zylstra, interim director of All Home, the county’s homelessness coordinating agency, which organizes the yearly count.
> “It’s not the kind of progress we all want to see,” Zylstra said. “But our performance data shows that the resources that we are investing in are housing people faster.”
The whole point of the head tax was to continue funding recommendations from the Poppe report. They're the same recommendations that are demonstrated to be working.
[0] https://www.seattle.gov/Documents/Departments/pathwayshome/B...
[1] https://www.seattletimes.com/seattle-news/homeless/new-homel...
If this Poppe report was the purpose of the tax, why was all the messaging "Tax Amazon!" instead of, "We need money for urgent projects!"?
Despite being 70 pages, that report was quite vague. Mostly platitudes like, "Prioritize the most vulnerable!" I hope the plans were more detailed elsewhere. And how much did that report cost?
Piketty's work [1] found real estate (and its favorable tax treatment) to be the largest driver of wealth inequality in America. Land taxes would be progressive. (Particularly if the first X dollars of one's primary residence were excluded.)
I’m looking forward to watching this same short of bootlicking and idiocy when Jeff comes around to extort tax breaks with the threat of HQ2.
I tend to assume it includes an effective social media campaign (complete with targeting), and maybe that's the core of it, but does anyone know?
Like in SF, there's a lot of lukewarm liberalism in Seattle, and when the rubber meets the road you can see the conservatism.
For Amazon, it may be a "corporate" tax. But for other low margin companies its just a tax on everyday people.
This head tax failed because the campaign in favor was driven by insane anti-capitalist ranting by Councilwoman Sawant and friends, who made it a "war on Amazon" instead of a traditional, civilized, "share some of the wealth" campaign.
That said, I'm saddened that the town council caved in so quick.
Our biggest problem is homlessness.
All I know, is it's basically illegial to live without a perment shelter in this once great country. Yes--once great. I'm not sure what's great about it anymore. If I had a do over, I would have hightailed it to France, or Canada in my twenties.
Can't sleep anywhere, including your car, without breaking some law.
There's know-where to go to the bathroom once they know you are homeless.
The industrious will find food. That's about all they might find. That food will eventually need to leave the body though? I just don't understand not providing bathrooms. I'm not homeless, and I have a hard time finding a restroom in San Francisco.
This country was founded by in debt homeless individuals? All the settlers were basically camping out?
Homelessness is our biggest problem.
It's beyond debating.
We need to open up available federal, state, and county land to camping.
We need to repeal all laws that have essentially criminalized being without a perment shelter.
I don't want to debate.
I've had too many friends die on the streets. Their last days were filled with overly aggressive cops ticketing them. That whole "fix the broken window theory" is policy for most counties now.
Even to those that have a home, and a good job; do you like living in a country with so many laws? Laws that are designed to trip you up if you are poor, or even middle class.
I'm sick of it.