The Spark

“The emancipation of the working class will only be achieved by the working class itself.” — Karl Marx

Amazon’s Game of Extortion

Oct 30, 2017

More than two hundred cities and states throughout the country met Amazon’s deadline in October to bid on the second headquarters they propose to build. Amazon claims they will contribute five billion dollars to build the second headquarters and hire up to 50,000 people who will be offered “high-paying” jobs.

City after city, state after state has proposed billions of dollars in tax breaks to one of the world’s wealthiest corporations. The governor of New Jersey has proposed seven billion dollars in incentives to lure Amazon to Newark, which counts a quarter to a third of its population living in poverty. The mayor of Chicago talked of two billion in tax breaks. The mayor of Baltimore, a city like Newark in terms of population living in poverty, proposes to put Amazon into a development that is already wringing 660 million dollars of taxpayer financed bonds and millions more in tax breaks from the state of Maryland.

But tax “breaks,” and utility “rebates,” and income tax deductions – all proposals to Amazon – come at the expense of residents of those areas. The rest of us will pay for those missing taxes, will pay for new roads, or new buses or trains, will pay for new water lines or power lines for the company.

In addition, an influx of thousands of people looking for nice houses or condos raises the price of housing for everyone. Look at the experience of Seattle, which got thousands of new jobs when Amazon placed its first headquarters there. The cost of housing has pushed poorer people, who don’t get half the pay of Amazon’s officials or computer programmers, farther and farther away from the city. They cannot afford the prices of rents or mortgages in the Seattle area.

As Seattle shows, huge corporations like Amazon come into a location as a double-edged sword – good pay for a few and a worse tax burden for everyone else.

As the mayor of San Antonio, Texas said in publicizing that San Antonio would NOT offer to bid on the Amazon proposal, it is a “race to the bottom.”