Eggheads: Cities, don't woo rich Amazon with sweetheart HQ deals
File under: 'Good luck with that'
A handful of university professors are calling on the mayors of US cities to let common sense prevail and refrain from offering Amazon tax cuts and other incentives for its new campus.
The change.org petition, crafted by University of Toronto professor Richard Florida and signed by professors from Harvard, MIT, and UC Berkeley, asks the 20 cities still in the hunt for Amazon's HQ2 to agree that their recruiting efforts should not include giving tax breaks to the world's richest man.
"While we are supportive of Amazon’s quest to build a new headquarters, we fear that the contest among jurisdictions — cities, metro regions, states, and provinces — for this facility threatens to spiral out of control," the petition reads.
"Already, at least four jurisdictions have proposed multi-billion-dollar incentive packages. This use of Amazon’s market power to extract incentives from local and state governments is rent-seeking and anticompetitive. It is in the public interest to resist such behavior and not play into or enable it."
Amazon has named 20 cities in the US and Canada as "finalists" to host what it promises will be a $5bn investment that would host 50,000 jobs. In exchange, the Bezos bunch wants concessions like like a "business friendly environment" [tax breaks] and large plots of cheap land.
Rightly reasoning that letting Amazon write its own ticket will minimize the actual benefits to the host city, Professor Florida suggests the cities agree not to hand out any tax giveaways and "direct monetary incentives" to the retail giant in making their pitches.
"States, cities, and metropolitan regions should compete on the underlying strength of their communities—not on public handouts to private business," the petition reads.
The suggested non-compete deal will be easier said than done.
While not handing out free land and tax breaks to a man worth $117bn makes perfect sense to just about everyone, these are US politicians we're talking about, and the bragging rights that would come with netting a major corporate campus from a tech giant will most likely drive them to hand Jeff Bezos the keys to the city. ®