Like the entire HQ2 selection process, the decision by Amazon to split its new headquarters between two cities,
Arlington, Va. and Long Island City in Queens, N.Y., has
gotten plenty of attention from business publications, media talking heads and
politicians alike. While the move is anticipated to bring 50,000 jobs to the two metropolitan areas, the company’s drawn-out
selection process has generated
plenty of negative criticism directed
at the e-Commerce giant.
The RTP team
discusses whether Amazon played fair with its selection process, and speculates
on some of the less obvious reasons for the final choices.
Debbie Hauss, Editor-in-Chief: It’s
disturbing that Jeff Bezos dragged this out for so long. He is now in
possession of detailed data on each city that was not selected, which he can
use to his future advantage. Additionally, he selected cities near to each
other, and is receiving $2.4 billion in incentives from the two states, plus Tennessee – the location
for the new Amazon hub. Many local businesses are happy with the decision,
according to Homebase: Food and beverage, retail, and health & fitness
stand to receive an influx of customers. Others are not happy, including
politicians, as reported by the Washington Post: “We
are witness to a cynical game in which Amazon duped New York into offering
unprecedented amounts of tax dollars to one of the wealthiest companies on
Earth for a promise of jobs that would represent less than 3% of the jobs
typically created in our city over a 10 year period.” — Sen. Michael Gianaris
and City Council Member Jimmy Van Bramer.
Adam Blair, Executive
Editor: New York Times business columnist James B.
Stewart chided Amazon for choosing two cities that
“didn’t need” its influx of jobs, New York and Washington, D.C., rather than a
heartland metropolis such as Indianapolis, Detroit, St. Louis, Cleveland or
Columbus, Ohio. “Picking one of these cities would have been transformative…as
an affirmation that there are great places to live in America that don’t offer
ocean views and $3,000-a-square-foot condos,” Stewart wrote. Undoubtedly true —
but Amazon’s responsibilities are to its shareholders, employees and customers,
not the country’s common good. No disrespect to the also-ran cities, but Amazon
wanted places with a ready supply of tech talent; let’s remember that most of
its profits come from cloud services, not its retail operations. I doubt Jeff
Bezos would be willing to wait until Detroit remade itself as a tech hub. And
as Scott Galloway cynically noted, Bezos has houses in New York and Washington
D.C. — an almost infallible indicator of where a corporate HQ will be
located.
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Glenn Taylor, Senior
Editor: I wouldn’t have minded these selections if two big things about it were
different: 1.) The selection process was more transparent — it’s simply not
fair to string along other municipalities if you were always going to pick an
obvious choice; and 2.) The outrageous tax incentives weren’t attached to the
deal. The second part reminds me of whenever a pro sports team moves to a new
city (or threatens to leave its current one), and the state fronts the bill for
the new stadium. Sure, a stadium is an economic driver that gets people to
spend and opens up jobs, but the billionaire in charge of the team can’t front
the bill? Given what Amazon got from the two cities, and even Nashville, the
company was likely to get a massive incentive no matter where it sited HQ2. I
have no doubt that being home to the biggest e-Commerce business in the world
can bring plenty of healthy revenue into the local economies in the long run; I
totally expect that to happen. But cities shouldn’t feel the need to sacrifice
immense capital sums in the short term when Amazon certainly can afford them on
its own.
Bryan Wassel,
Associate Editor: Amazon may very well have known it would choose New York
and Washington D.C. from the start — New York City is a well-equipped tech hub,
while Washington puts the retail giant near the government’s seat of power.
However, that doesn’t mean Amazon was just stringing the other competitors
along for no reason. Those failed proposals told the company just what these
other municipalities would give up to earn its business, and they no doubt
included other actionable information about infrastructure plans and growth
potential. This could be valuable intel for future smaller projects, such as
distribution centers or innovation hubs. If Amazon is serious about expanding
its network of physical stores, that may well entail the need for more warehouses
and other support infrastructure. By farming out proposals from cities across
the U.S., the retail giant has gathered the information it needs to create a
bigger, more detailed map of how such a plan could proceed.
