Amazon's electricity rate discounts have pushed up utility costs
bloomberg.com
bloomberg.com
Maybe someday we'll get an itemized tax bill, so you can see that you paid $4.12 for Amazon's electricity and $1.23 for a new sports arena, and can vote for someone else if that upsets you. Now that I think about it, that will never happen. And so, the cycle continues.
Most cities that tell teams to shove it just end up losing their teams to other markets: In this case, San Diego and St. Louis.
I get what you're saying, though - cities often give up a lot (and probably too much) to keep franchises happy.
I'm mostly just pointing out the major power disparity between LA and other cities: Major sports teams want to be in LA far more than LA wants a major sports team. That's not true of, say, Seattle or St. Louis or San Diego.
>..."There will be no public dollars, no taxpayer dollars used for this project," he said. "The entire project has been privately capitalized and is being privately funded." The nuance between that statement — similar claims were made by Inglewood Mayor James Butts — and tax breaks that could reach $100 million lies in the fine print of a 185-page initiative plan filed by the developers earlier this month. It includes two paragraphs of how Inglewood would eventually reimburse the project for the costs of roadwork, utility work and public parks on the nearly 300-acre site. Meany estimated those costs at $60 million. The city would also reimburse costs of security, medical services and shuttles to off-site parking during stadium events, which Butts estimated at about $8 million a year.
http://www.latimes.com/sports/la-sp-stadium-tax-break-201501...
Also, being pedantic, Inglewood is its own city.
Step 1: Make a threat about jobs/money to get lawmakers to pay attention.
Step 2: Get favorable legislation passed. Hold hands with lawmakers in photo-op for the papers.
Step 3: Stall on delivering on promises until lawmakers leave office or come up with excuses.
Step 4: Profit.
For who are this measures passed? Interesting explanation:
Yes, just like they "fall for" municipal operas, art museums, Shakespeare in the Park, and any number of other cultural amenities that don't have obvious and immediate economic impact.
Perhaps your complaint is less about public investment in cultural benefits than it is an issue with one particular kind of culture?
> During its history, the zoo-museum district - officially known as the Metropolitan Zoological Park and Museum District - has raised about $1.3 billion, stabilized five once-struggling institutions and helped some of them develop international reputations.
Source: https://www.stltoday.com/news/local/metro/zoo-museum-tax-dis...
So that's $1.3. billion in tax dollars raised specifically to fund the museums and zoo in the largest park of one mid-sized U.S. city.
That tax raises 35 times the $5 million per year the city pays on the bond for the old Rams stadium, which generates a lot of articles like this one:
https://www.huffingtonpost.com/entry/rams-los-angeles-st-lou...
Of course, HuffPo doesn't write any articles about the zoo tax, because literal rams in cages is a more noble use of money than figurative Rams throwing a football, one presumes.
The number here also dwarfs the direct public subsidy for Busch Stadium, also in St. Louis, which also got a ton of ink and public scrutiny.
More info on that subsidy here:
https://www.thefreelibrary.com/What+the+public+paid+for+the+...
That's divided amongst 5 public organizations. Not all going to one billionaire.
"That tax raises 35 times the $5 million per year the city pays on the bond for the old Rams stadium"
Stadium for one purpose, for a team owned by a billionaire, who also left town.
The cost to the city was also far more than just $5 million a year; the total amount the city put behind the stadium was $280 million.
"Of course, HuffPo doesn't write any articles about the zoo tax, because literal rams in cages is a more noble use of money than figurative Rams throwing a football, one presumes."
Or maybe it's because NFL teams, with the exception of the Green Bay Packers, are owned by billionaires who could easily afford to build their own stadium.
And I've never seen a zoo threaten to leave town unless the city agreed to pay for a new elephant habitat.
1) We spend money on other types of cultural amenities all the time and nobody cares; and...
2) That spending is of an amount that lodges it appropriately within this conversation.
In fact, what the high salaries in sports reveal to me is that the public wants sports a lot more than they want museums.
So I guess that means we're at an impasse.
> You chose not to mention that, for reasons I think I know.
You should re-read my original comment, the one that started this truly silly subthread, which twice reveals that there are multiple organizations included in the district.
how many of them now are actually one purpose? Local example is AT&T Stadium (also known as "Jerry World") which in addition to the occasional Dallas Cowboys win also hosts a lot of UIL sporting events, high school football playoffs, motocross, monster trucks, rodeo events, and a bunch of concerts.
Nearby Globe Life ballpark has... well, baseball.
> And I've never seen a zoo threaten to leave town unless the city agreed to pay for a new elephant habitat.
Never seen one threaten to leave, but I've seen them threaten to close down exhibits.
More on Standard Oil, rebates, and the breakup of the trust: https://repository.law.umich.edu/cgi/viewcontent.cgi?referer...
I also recommend Titan, the well-researched John D. Rockefeller, Sr. biography by Ron Chernow.
http://www.businessinsider.com/amazon-not-paying-taxes-trump...
https://www.politifact.com/truth-o-meter/statements/2018/may...
They do pay taxes...
"According to an analysis from the ITEP, the gap between the tax rate that some local tax jurisdictions impose and what Amazon collects can be as much as 7.5 percentage points in Homer, AK., for example."
http://fortune.com/2018/03/29/amazon-tax-rate-president-dona...
'To be clear, Amazon purchased only the trailers and will use third-party companies for the actual truck cabs and drivers. The original source report did not make clear there was a distinction.'
https://www.technobuffalo.com/2015/12/04/amazon-prime-now-ha...
Presumably Amazon funds paid to delivery services are also used to pay for gas, which therefore indirectly pays for the roads.
You could make a (good) argument that they are underpaying their contract drivers, but nontheless -- everytime they pay a contract driver to drop a package off at your house, Amazon is paying for that gas in their pay to the delivery driver.
The same is true when they use a commercial delivery service at all -- the cost of fuel tax is bundled into the delivery price.
Whether Amazon owns any trucks of their own is immaterial, if they are contracting with Amazom, Amazon is ultimately paying for the fuel (including taxes).
https://www.citylab.com/transportation/2015/05/debunking-the...
https://frontiergroup.org/reports/fg/who-pays-roads
They pay less for the roads than you or I. You are subsidizing Amazon's business with your taxes.
Yes, they're getting picked on because they are the most exploitive (extreme tax avoidance, worker abuse, etc). It seems that would be the first org you would pick on: the one causing the most damage. Why would we pursue or focus on the orgs doing the least amount of damage first?
But there's only one of me.
That isn't the point though. Like Facebook and privacy issues, the ultimate outcome of this will either be (a) nothing, or (b) government singles out Amazon alone for scrutiny, which does nothing to stop the same systemic problem that happens at many other employers also but goes unreported because the company in question isn't tech-sexy (Wal-Mart, Ford, etc).
The fix needs to be applied universally, without considering how much damage individual orgs are doing.
Appreciate any feedback you provide!
That's not close to what the person you replied to said though. They simply said that Amazon is not alone in doing this. That it's a much larger problem.
> How would you argue against such an argument?
I wouldn't. I would see anyone saying: "Someone else does X" as providing additional evidence this an even bigger problem. So Amazon isn't the only one doing this? Walmart is also doing this, as well as other companies. What can we do to stop this all-together? Because focusing on Amazon won't solve the problem. In fact, in some ways it becomes easier when there are many "someone elses" doing X, because then it comes a general problem, and not a specific attack on any one company someone might have an attachment to for some reason.
Local jurisdictions can and do give steep tax (and other) discounts to attract businesses and stadiums (just two examples). You would have to revoke local governing authority to prevent these sorts of venue shopping (IANAL; if you have better suggestions, I’m all ears). I don’t believe that is realistic, so I don’t argue that as a legitimate solution.
Maybe you could tax at a federal level where you can overrule local taxing policy (similar to new SALT deduction constraints in federal tax policy), negating the benefits of venue shopping.
Yet... this is Amazon, and HN hates Amazon.
There have always been and probably always will be unpleasant jobs. I watched 6 guys replace the roof of my neightbor's house yesterday in Houston. It was 100 degrees on the ground so I'd imagine it was intensely unpleasant working 8 hours on the ashphalt shingle roof. Does that make the roofing business exploitive? Should we all abandon our roofs?
When I worked at Amazon we had to run around the warehouse, bc
if our pick rate fell below a certain number we stopped getting
paid. There were bottles & bins full of piss at odd points, bc
you were penalised for toilet breaks. A co-worker attempted
suicide on-site bc of the stress
If this isn't exploitation, I'm not sure what it would be.
It's like the meat packing industry... People die there in big numbers, but it just continues.
That's not true. Many times people use the "asking questions" as a ruse to do just that, and erode support for these people by saying it's their own fault for being exploited.
And, quite frankly, I don't care one iota why they stay; there is exactly zero legitimate reason for them to be treated like that. Bezos should be so ashamed of himself that he would be unwilling to show his face in public.
There is always a cost associated with trying to change a job, one that may be difficult for a poor person to pay. You need to do research to find these other job choices (and you really may not have many choices depending on where you live), apply to multiple places, show up for interviews, etc. Doing all these activities takes time and energy, which a person, who is possibly already struggling to make ends meet, may not have. Imagine coming home from your grueling warehouse job where you had to pee in bottles, putting together a dinner for yourself and your kids, doing some basic chores around the house so that your place doesn't turn into a shithole, and then finding the energy to do all the things you need to do for finding a job.
It's easy to pontificate while sitting in our cushy tech job chairs, where if we don't like the current job, there'll be 10 recruiters blowing up your email with job opportunities, about what a person who may be less fortunate should do.
> I think it's just easier to blame Amazon than for people to make different choices. It is possible that some blame lies with both parties, but Amazon definitely shares a clear (and rather heavier) burden of blame here, and there is nothing wrong in calling that out.
It's not easy for a lot of people to find jobs. It's not easy to go weeks without pay while you apply, wait for drug tests to come back, go through initial onboarding, and then wait 2-3 weeks for your first paycheck.
The fault is not with the person being exploited, it's with the exploiters.
That’s a great question and I’m sure the answer would be interesting. Assuming most people working there to be unreasonable or illogical would be unfair to then.
> There are other jobs I’m sure
Or is there ? What’s the criteria for “other job” ? How do they look for it, when, on what terms ?
If that many people are just stuck there, I think it’s just not a “I just quit and go work for some other 9 to 5 job tomorrow” situation.
1. College is expensive. Outside of the trades and a few other exceptions, a college degree used to be the best way for young people or unskilled laborers to get into higher-paying, more stable jobs. That math doesn't work out so well anymore, and there are continuing efforts to further increase the individual cost of a college degree. The percentage of college graduates in the U.S. has risen only a few points since the late 70s: https://en.wikipedia.org/wiki/Educational_attainment_in_the_...
2. Lack of affordable health care is preventing a lot of people from opting out of the job market. If you have any kind of illness that requires regular treatment, or even if you're worried about getting bankrupted by an injury, then you're forced to look for employers offering company health insurance, even if the pay is crap. Amazon offers health insurance for their full-time employees: http://www.amazondelivers.jobs/about/benefits/. As long as there isn't a sensible, publicly-supported health care system in the US, companies will be able to exploit this to get and retain workers at a net discount.
3. Rising housing costs in many urban areas are further squeezing a lot of people.
4. Upside-down tax structures and other financial incentives (like the ones described in this article) are further moving a lot of money from the poor to the rich. These factors together are creating a de facto peasant class, and massive companies like Amazon are doing their level best to ensure that it stays that way. It is a really good deal for Amazon when they can work this system well enough to get the public to subsidize their employees' food costs (https://yro.slashdot.org/story/18/04/21/1634237/many-amazon-...). Remember when the Silicon Valley big-wigs colluded to create a non-competitive job market for tech employees (http://fortune.com/2015/09/03/koh-anti-poach-order/)? And out of that lawsuit, the tech workers got just $5k on average. That was a fantastic deal for the companies.
So if you're a low-skilled worker, that doesn't leave you a lot of options on the table. You hear Amazon advertising (via some staffing firm) for warehouse positions in your area, it sounds like they'll hire anybody, you've heard the work conditions are bad but you figure it'll be temporary, and hey, health insurance, if you're lucky enough to be considered a full-time employee by the company.
Fix health insurance, and more people would get into the trades. Fix education, and more people would get a degree. Fix housing, and people would be less desperate for crappy work. Fix regulation, and communities would get a lot wealthier.
Unfortunately, none of that appears to be happening anytime soon, because there's a long line of people willing to argue against any of those things for one ideological reason or another, because the situation hasn't gotten quite bad enough, quite fast enough, for them to see anything wrong with it.
And quite frankly, I honestly do not care if there are other jobs or not. That kind of treatment is completely unacceptable, and there is zero legitimate reason for Amazon to treat them that way.
https://www.usatoday.com/story/money/2018/04/26/truck-driver...
There seems to be this bubble of thinking on HN that hard labor jobs don't pay well. The reality is they pay more than your average IT Support job. They are in demand because they can't find people willing to do the work. Another example is electricians. Some electrician companies are so desperate for skilled electricians that they are paying their retirees to come out of retirement and still allowing them to keep pension benefits. Another one is plumbing, etc.
Roofing especially in a hot climate is harder more demanding work than a warehouse job. And it pays considerably more.
Roofing pays a premium because it is a crap entry level job that is hard to staff with reliable workers. The labor force is generally limited to younger able bodied men with transportation who are willing to do seasonal work.
Amazon can recruit almost anyone to do picking and can get value even from the people whom they purge.
Have any evidence of this or is it purely anecdotal? Many warehouses aren't air conditioned, especially Amazon ones.
https://www.businessinsider.com/amazon-warehouse-2011-9
> Amazon kept paramedics in the parking lot of the warehouse to treat employees who were fainting, suffering from dehydration, or exhaustion.
Then again, while the warehouse I worked in had much less stringent metrics than Amazon’s, there were other factors that may have made it worse overall.
People do have choices.
6 guys, 8 hours? Seems reasonable. The Amazon way would be 4 guys working 16 hours, but I’m rotating shifts so that you don’t have to pay OT, but knowing that the rotation is such that people won’t leave the job site. And when somone goes 1-minute over their 15 minute break they are fired and replaced on the spot.
Amazon treats people as inanimate objects completely devoid of humanity.
What are you talking about? You've moved the conversation away from a specific discussion of Amazon's practices to an anicdote.
Unpleasant does not equal exploitative. Amazon is unpleasant and exploitative.
Also, please don't be uncivil in comments here, even when another comment is wrong or annoying. ("What are you talking about?" is the sort of nasty elbow that can and should just be edited out of a post.)
Not really. It's an ongoing discussion sparked by the number of articles that appear on the front page that are deeply related to the economics of the tech industry. It interests me. If genuine comments responding to articles from a particular and consistent point of view are unwanted I can stop.
Everytime I log in something like this is at the top of the front page. Even now this is there: https://news.ycombinator.com/item?id=17804202
I understand your concerns and as it's not my platform fair enough. Will do better.
> If you'd review the rules
Will do
> please don't be uncivil in comments here
Fair and noted.
I've posted other explanations of our thinking about this, in case it's of interest: https://hn.algolia.com/?amp;sort=byDate&dateRange=all&am....
I love this job a lot more than my old sales jobs which involved needless travel, quotas, pressures, and lots of layoffs!
That "probably" is doing a lot of work there. I'd wager a bunch of us are on this website because we want to make changes in the world. We're not excited about computers because they pay well, we're excited about computers because they let us do cool things. We're not interested in disrupting entrenched industries because we are bored and want to amuse ourselves, we're interested in disrupting entrenched industries because we think we can do better. And when we say better that implies that we have a sense of good and bad and how to incrementally get closer to good.
So what is the world we want to build? We, humanity collectively, control whether there will be unpleasant jobs. No god told us, "Thou shalt build roofs in 100-degree weather or pay the consequences." We control what jobs exist. There are people working on robotics, right? I can imagine a world where nobody works 8 hours in 100-degree weather on an asphalt roof any more. And whether I call that job "exploitative" is pretty irrelevant to whether we're getting closer to that world.
There have always been unpleasant jobs, yes. Whether there will be is up to us.
It’s pretty hard to have a business of any size and not touch Amazon in anyway. Amazon, in many ways, has becoming embedded the as GE once was.
Economically-questionable conclusions: although individual secretive utilities might on occasion make dumb deals, they'll charge households whatever the market & regulators will allow, and then charge Amazon whatever the market & regulators allow.
And utilities would like Amazon as a customer because of the efficiencies of scale it'd provide. They'd not want Amazon at-a-loss, that then requires making other customers to pay more – and if utilities already had the market-power or case-to-regulators to charge others more, they'd already be doing it.
And even in the particular leading anecdote of the article, it's not so much Amazon's rates that have caused a regulator to approve a new assessment on other customers - it's neighbors' demands for more-expensive underground transmission lines. Even if Amazon received no discounts, the lines would still be needed, and the regulator would allow this sort of capital outlay to be passed-through to ratepayers.
Economically-questionable conclusions: although individual secretive utilities might on occasion make dumb deals,
they'll charge households whatever the market & regulators will allow,
and then charge Amazon whatever the market & regulators allow.
Edit: formatting
That's interesting. In Norway and UK, etc., You can buy your electricity from any operator you like. The only monopoly is the power cable. So I get two bills, one for energy and the other for the transport of it.
That there, is enough, though. It's not as if you could choose not to pay for that portion and pay only for the energy.
As such, the rate could go up without bound. (Well, bounded by competition from off-grid systems that are 2-6x as expensive in the long run and have a huge up-front cost).
"Jeff Bezos Becomes the Richest Man in Modern History, Topping $150B"
https://www.bloomberg.com/news/articles/2018-07-16/happy-pri...
Sure, I'm playing the devil's advocate here, but in the end it's also really hard to define what is 'good spending' on tax dollars. For all we know, Amazon venturing into health care will end up being a great substitute for socialized health care. It could become Bezos' ultimate philanthropy. It could also be what gives him super villain-like power over the US.
Most social services in developed European countries that allow people to be better off and not squeezed and abused by companies like Amazon? Healthcare, transportation, public housing, higher education? Literally almost anything besides what is spent on the USA’s unwinnable, forever wars?
It’s not hard as soon as you set aside American Exceptionalism as having any legitimacy.
Actually, this is the party line of the right-wing in the US. It's not more, it's less, because...freedom?
https://www.independent.co.uk/news/world/americas/us-politic...
But buying toilet paper, towels, and other random supplies is not a fun or enjoyable experience. There is nothing fun about going to a big box store, walking down crowded aisles, loading up a rickety, squeaky cart, and pushing it to a checkout lane with a long line. No one likes going to the store to shop for boring stuff so Amazon delivery is a clear winner there.
But brick and mortar isn't going anywhere. It will always continue to be successful for sales that are actually fun and enjoyable things to buy.
The community wanted it buried at a higher cost? Well, Dominion has a right as a regulated utility to negotiate rates for the following year to match infrastructure and other costs. This is so they can recoup / respond to storms and other issues. It's a part of utilities regulation.
Now, if they get a sweetheart deal on top that's certainly a different story, but the infrastructure cost passed on to the consumer thing has been part of the deal for a long time. It would likely only be higher for that following year, and then rates would return higher but closer to normal as the buried pipe went into O&M mode.
> She was already struggling to pay her monthly $170
Her bill is 2x mine in the winter, and 5x it in the summer, and I pay 2x per kWh¹ more than she does. Am I unusual, or is this an absurdly high electric bill?
¹https://www.electricitylocal.com/states/georgia/gainesville/ ; Gainesville electric rates appear to be 11.6¢/kWh; I'm paying over 20¢/kWh
You're unusual.
Or, rather, her bill is high, though not absurdly so, especially if it includes more than just the per-kWh charge (e.g. a fixed/per-meter charge or even additional utilities like water) and if it's her only household energy source (i.e. no natural gas, propane, or heating oil).
Virginia gets warm and humid in the summer and cold (enough) in the winter. Using resistive heating can really jack up an electric bill. The absurdity of that form of heating is at least debatable.
$34 in the summer mean 170kWh, which is remarkably low. It implies no AC, no or very light use of appliances like a dishwasher, clothes washer, or dryer, and either little use of hot water (or "cheating" with a gas-fired water heater).
A single 100W light bulb (remember incandescent bulbs?) left on 24x7 would use 73kWh in a month.
It starts with a story about how Amazon wanted to get power lines through a data center, and the community forced it to expensively route around a historic site, and the user base ended up getting a rate hike to pay for it (despite most of them not needing that part of the grid).
Sounds cut and dry for the Ohio anecdote as well.
This should also apply to stadiums where, for reasons I cannot even fathom, small cities throw billions into a building that they don't own, that has an astonishingly short life-span, and for which they derive very little in the way of actual benefits.
Unfortunately, many corporate tax breaks are created to compete with the municipality next door for economic activity that would occur in any case. The key point is that even if all municipalities banded together and agreed not to TIF, then the economic activity would still occur.
Concretely, here's a list tallying the value of Wal-Mart TIFs: http://www.walmartsubsidywatch.org/state_tallies.html
Now, here's the key question: would Wal-Mart (or a competitor) have built all those stores and distribution centers without TIFs? I.e., is Wal-Mart profitable without tax subsidies?
The answer is obviously yes: those stores would still be enormously profitable, so Wal-Mart would still build them. Which means these tax breaks are not creating new value or spurring economic activity that would otherwise not occur! These TIFs are simply a wealth transfer from local taxpayers to Wal-Mart executives and shareholders, orchestrated by playing municipalities off of one another.
Hundreds of millions of Americans pay extra taxes and/or receive inferior services because municipalities won't cooperate in a game of prisoner's dilemma. Great for the Waltons, though.
TL;DR: because allowing municipalities to compete using TIFs results in wealth transfers from local communities to large corporations without creating new economic activity that wouldn't have occured anyways.
People see salaries of FAANG engineers and think that those companies pay well in gneeral, and furthermore that the tech industry pays well in general.
I've seen this first-hand: people were super excited about an Amazon distribution center being built in a town I used to live in. The thought process goes something like: "Amazon says they'll be hiring hundreds of people and that they will train people on the job. Also, Amazon engineers make 100k. Therefore Amazon will hire me, train me, and I'll be making 100k!"
I think the ship has now sailed on Amazon; people today realize that an HQ full of engineers is different in kind from a distribution center.
But the cycle continues with other low-skill and medium-skill "tech" jobs. For a particularly striking example, see some of the rhetoric around the Foxconn plant in Wisconsin...
* A computational paywall is one where you have to run arbitrary code from an untrusted source in order to access the content.
You made up the term computational paywall, made up that paywall articles are against the spirit of HN (the "web" button specifically helps with getting cached versions of articles or bypass some paywalls through Google redirect. It's available on each thread).
A quick Google search shows you're are the only person who has used the term computational paywall.
Paywalls are against the spirit of HN. They always get switched out with non-paywall sources if possible.
The 'web' button unfortunately does not help in this case. The only source is bloomberg.