My hometown, Pittsburgh, is on Amazon’s short list of the 20 cities where they might build their second headquarters. I love that a(nother) hot tech company recognizes that our city is a great place to be, but you know what? I kind of hope we aren’t chosen.
Amazon’s lengthy and competitive decision making process is kind of terrifying because it feels like a bigger version of what happens when a sports team wants a new stadium: a company goads a city into paying for its business expenses.
There’s a good chance that the “winning” city will give the company significant tax breaks, and still have to contend with paying for the infrastructure to support it. I would love if my city got, say, a better public transit system as a side effect of HQ2. But what price would residents indirectly pay for that?
Seattle journalist Knute Berger tells Business Insider that Amazon’s original headquarters has displaced minority communities there, driven up housing costs, and swelled the city’s population of homeless people. Seattle is also in the nation’s top 10 cities with the worst traffic, and doesn’t have a public transit system good enough to alleviate traffic pressure. I’m thinking of my city, Pittsburgh, as I read about Seattle’s troubles. Our housing costs are blessedly cheap to begin with, phew. But I can’t imagine any part of the city handling 50,000 employees worth of traffic. And our public transit kind of sucks.
Amazon has reportedly infused $38 billion into Seattle’s economy, and it’s promising $5 billion to whatever city ends up with HQ2. Perhaps it’s worthwhile. But the 20 cities are competing fiercely, and I’m terrified to wonder what my city has offered them in terms of tax breaks or residents’ firstborn children. And you know why I’m wondering?
Because Pittsburgh won’t say. Officials turned down public records requests, saying that they didn’t want to compromise the competitiveness of their bid, and that they had signed a nondisclosure agreement with Amazon. “My goal is to win, not to do what other cities are doing,” one county executive said. CNET reports that Indianapolis, Miami, Montgomery County in Maryland, northern Virginia, Raleigh, and Los Angeles also refused to release any financial details.
Some of the other cities offered partial information. Among those that seem to be coming clean about their financial incentives, only Nashville said tax breaks would be “absurd.” Atlanta is offering $1 billion. Newark is offering $7 billion. Chicago’s offer of $2 billion reportedly includes a heart-sinking bargain: workers would pay taxes as usual, but then the city would give that exact dollar amount to Amazon. Remember, that’s your share of the money you pay to help your community. This feels like the beginning of one of those Snow Crash style dystopias where corporations replace governments. “Many have criticized giving incentives to one of the world’s most valuable companies, calling it corporate welfare,” the Illinois News Network reports.
I suppose paying a few billion to become a tech hub isn’t as bad as another project in the Pittsburgh area, where the state is giving a petroleum company $1.7 billion in tax breaks for an environmentally risky project that only brings in 600 permanent jobs. So, I guess it could be worse? Just be careful what you wish for.