Amazon Reconsidering Plan to Put Campus in New York City

That's right.... nobody is denying that a large company creating jobs, is a bad thing. People are upset for the large subsidies.

the "Do you believe NYC should give 3B+ subsidies to Amazon"

Or, "Do you believe NYC giving 4 times the subsidies to Amazon, compared to D.C., is a good deal?.?

are missing. Put them into the questionnaire, and see how the response rates change.

Cherry picking.

Also from the poll:

a majority of New York registered voters also see it as likely that Amazon’s HQ2 will increase the cost of housing in New York City and complicate public transit and transportation, among other issues.

This seems to support the parent’s general claim about the subway etc.

Did the poll ask if New Yorkers were happy with the subsidies?

The poll question: Do you approve or disapprove of Amazon locating one of its new headquarters in Long Island City in Queens? is at least vastly incomplete.

I don’t know the specifics, but it seems fair to me the question should be something more like: do you approve or disapprove of the city spending $x of taxpayers money on a deal to bring Amazon to NYC?

I would like to remind readers that Amazon funded this poll. Take from that what you will.

Having more people in NYC is great for climate change, because the urban environment is a lot less carbon intensive. In what other city could Amazon locate where fewer net cars would be added to the roads?

Part of it is New York's system is much older than the rest of your examples, Tokyo didn't really expand beyond a single tunnel till 50s-60s, Beijing opened in the 60s and Shanghai only started construction in the mid 80s. Then on top of that the city of New York isn't actually in charge fully so (like just happened) if they try to do something disruptive but critical the governor can come and derail the whole plan. I don't mean to say it excuses the mismanagement but it does explain a lot of the problems.

Also it's not like they're not building new stuff in 2017 the second avenue subway opened with 3 new stations.

This is only true if the company's behavior is changed by the incentive, and the parent's comment was about the view that it isn't.

Moreover, in the global sense we have been deprived of revenue. Amazon was going to open somewhere. This competition means that they overall pay less tax than without it, because they extracted concessions. If we care about protecting the public purse in the general sense, it's reasonable to object to these tactics.

> But that's not what a tax incentive is. The incentive is: bring your business here, create jobs, add economic fluidity with your workforce and you don't have to pay 3 billion dollars in taxes.

It's true, but it's not like your employees also get a tax break. It seems again like the workers are shouldering the burden.

The only reason why this works is because it's a race to the bottom where big companies get huge benefits to their taxes because they can shop around (just like Amazon did with the whole HQ2 thing), and then pick who treats them best. Most businesses don't have that kind of leverage.

If no state offered any tax incentives like this, then companies would just end up paying more taxes, right? We could get into moving your company to another country, but for Amazon this would mean a lot of things, like increased shipping times, customs, etc.

From https://theweek.com/articles/754007/are-corporate-tax-incent...

"Economists say that most of the time, the incentives are counterproductive — a zero-sum game in which jobs created in one community come at the expense of jobs lost somewhere else. The real winners are companies, which are able to play municipalities against one another so as to be freed of paying taxes other businesses (and homeowners) do. The result is a "race to the bottom," leaving cities with less to spend on infrastructure improvements and public education. At the same time, companies increase expenses for communities by drawing on public resources, including sewer systems, roads, power lines, and schooling for workers' children. Last year, Wisconsin pledged $3 billion in incentives to electronics manufacturer Foxconn to build a plant in Racine County that the company says will eventually employ 13,000 workers. But according to Wisconsin's own estimates, the cost to taxpayers per job created is $230,700, and the state won't recoup its investment until 2043."

And now more recently, Foxconn has been saying they won't even have as many jobs as they thought!

https://www.chicagotribune.com/business/ct-biz-foxconn-plant...

You are guaranteed to not earn that 3 billion from that area (usually property tax based) if you offer that incentive to Amazon. You will get something from that area if you don't. Amazon isn't the only game in town - it's not like NYC is starving for new business...

The money is absolutely real, and the point is that NYC has what Amazon wants, Amazon does not need corporate subsidies, and that NYC should be leveraging its talent pool and thriving economy in order to generate more revenue for the city. Cuomo's incompetence left $3bn in revenue on the table.

Furthermore, representing your constituents is not "populism". Local residents are intimately familiar with how gentrification displaces entire communities considering it happens all the time there. Big business Democrats like Cuomo and DiBlasio are just having a tantrum because they're so seduced by revenue charts that they've completely dissociated from the impact of these decisions on real people.

Your logic would also conclude that all taxes are a mistake, and a rational municipality would offer a 100% tax break to everyone as an incentive. That seems like too strong a conclusion.

Your explanation might be correct, but that's not what many cities offered Amazon. Most offered comprehensive packages that offered to subsidize wages and construction, improve infrastructure, etc. on top of the basic tax credit you refer to. The city would likely be out any of the money it put up for infrastructure upgrades if Amazon had bailed on them.

Montgomery County, Maryland offered an $8.5B incentive, which included $2B in infrastructure & transportation improvements around the HQ site. If Amazon had pulled out, $2B went towards optimizing an area that's no longer a job center. Philadelphia's incentive included $1.1B for essentially the same function. Atlanta offered $2.2B in infrastructure investment.[0]

[0]: https://slate.com/technology/2018/11/amazon-hq2-incredible-i...

> See how different is that?

It’s unclear what the difference is without seeing the projections for how long it will take the city to recuperate the $3B.

If the city believes having Amazon HQ2 will generate an additional $3B in revenue over the next 5 years then perhaps it’s a reasonable deal.

If it’s going to take 50 years, then possibly less so.

The projections are done by the city and state in this case, not Amazon. The city/state agents involved worked with a third-party (REMI) to perform a comprehensive forecasting and economic analysis. Also, most of the subsidies here are not in the form of capital investments, but rather things like tax credits which are provided for some action already taken (for example, having created a job that meets certain requirements).

This deal is very safe because it is paid out incrementally, over time, and mostly in-step with incremental actions taken by Amazon, and because the ROI is so big (even if projections are significantly off target, this will still be a win).

> who receives those returns? Is it going to help New Yorkers who need help, or to the already rich?

The net new revenue can be used by the city and state to pay for whatever services they deem fit (e.g. infrastructure, health, etc.).

> we've seen these kinds of wildly optimistic plans time and time again with companies promising tax revenues based on straightforward filing, and then using the wide variety of loopholes to (legally) avoid the projected taxes

The company is not promising tax revenues here. The city/state are. They are the ones who commissioned the economic analysis, and I am sure the findings informed their negotiations. The tax sources are not just Amazon either - it includes things like taxes from the additional jobs and businesses that will be created outside of Amazon.

> I don't really care to hear about ROIs.

The ROI is what matters, though. If you were a city that is looking to increase your budget to provide more services to your constituents, you might consider what sort of investment choices you could make to get there. The ROI here is well beyond any other conceivable option. It is so large that even if projections of a 9:1 ROI are way off, it would be a big win. To put it into context, the NY Film Tax Credit program had a 1.15:1 ROI but was still implemented. Also, most of the subsidy to Amazon is not an up-front lump sum. Rather, most of it takes the form of credits for prior actions.

Taking all this into account, this seems like a super safe path to greater tax revenues, which will improve the city and state as a whole.