Amazon planning second headquarters with 50,000 jobs

[nfotiu]

Originally Posted by GGG

This is the problem,

Maryland and Virginia shouldn’t be in a race to the bottom to offer tax breaks to canabalize jobs from eachother. When governments compete on tax breaks for corporations citizens lose.

This is effectively the Arena debate. If no one subsidized arenas, Salary Caps would be lower and leagues could easily afford they own. Because cities can steal teams by providing free or subsidized arenas the public in general loses and the dollars that could have been used to build arenas is split between the players and the owners. (Yes I acknowledge that subsidizing Amazon on the local level has significantly better returns then a sports team)

There's a huge difference in scale here. Paying 600 million for an Arena that allows a team to pay its 25 employees millions of dollars who live in the city part time vs paying 600 million for a company that will employ 25,000 full time residents. The aren't stealing from MD or anywhere else, as they are not moving HQ employees from anywhere.

[MelBridgeman]

Originally Posted by nik-

Again, that's all stock market. That's not the real economy.

Of course when companies can slash and export workers and be more profitable, with more automation, their stocks are going to boom.

The underlying engine of the economy, middle class buying power, has stagnated since Reagan, and no president, regardless of party, has really done anything to fix it.

fair enough.

[GGG]

Originally Posted by nfotiu

There's a huge difference in scale here. Paying 600 million for an Arena that allows a team to pay its 25 employees millions of dollars who live in the city part time vs paying 600 million for a company that will employ 25,000 full time residents. The aren't stealing from MD or anywhere else, as they are not moving HQ employees from anywhere.

Do you agree that Amazon would have built headquarters somewhere in the US without subsidies? I do. Therefore these jobs moved from one jurisdiction (the jurisdiction amazon builds it in without any subsidy) to another as a result of tax breaks.

This subsidy didn’t create any new jobs that wouldn’t have existed somewhere in the US. It didn’t create any new tax base that wouldn’t have existed somewhere in the US. It assured that Virgina would be the spot this would occur.

[nfotiu]

Originally Posted by GGG

Do you agree that Amazon would have built headquarters somewhere in the US without subsidies? I do. Therefore these jobs moved from one jurisdiction (the jurisdiction amazon builds it in without any subsidy) to another as a result of tax breaks.

This subsidy didn’t create any new jobs that wouldn’t have existed somewhere in the US. It didn’t create any new tax base that wouldn’t have existed somewhere in the US. It assured that Virgina would be the spot this would occur.

It created a new tax base in Virginia, period, and that is worth many times as much as 600 million dollars.

There are wildly different local tax rates, state tax rates, state income tax rates, property taxes across the various states and localities in the country. Would you be fine then if they just picked the lowest taxed state/county in the country. It would have probably saved them a hell of a lot more than 600 million.

Basically, they are investing enough in the state that will be very lucrative to the state, that they can negotiate some off of their tax rate. It's not limited to giant companies. Very small, small, and medium companies around here get local and state grants and tax breaks all the time to invest in new ventures.

[GGG]

Originally Posted by nfotiu

It created a new tax base in Virginia, period, and that is worth many times as much as 600 million dollars.

There are wildly different local tax rates, state tax rates, state income tax rates, property taxes across the various states and localities in the country. Would you be fine then if they just picked the lowest taxed state/county in the country. It would have probably saved them a hell of a lot more than 600 million.

Basically, they are investing enough in the state that will be very lucrative to the state, that they can negotiate some off of their tax rate. It's not limited to giant companies. Very small, small, and medium companies around here get local and state grants and tax breaks all the time to invest in new ventures.

The difference our discussion right now is where do you draw a box around and say anything that comes into the box is new growth.

I see drawing the box at the city and state level as a tragedy of the commons in which jurisdictions are incentivized to provide larger and larger tax breaks for the most profitable and largest corporations.

Your position which is just as valid is that Virgina made a good deal for Virgina and therefore makes sense.

[iggy_oi]

Originally Posted by nfotiu

It created a new tax base in Virginia, period, and that is worth many times as much as 600 million dollars.

There are wildly different local tax rates, state tax rates, state income tax rates, property taxes across the various states and localities in the country. Would you be fine then if they just picked the lowest taxed state/county in the country. It would have probably saved them a hell of a lot more than 600 million.

Virginia is one of the lowest taxed states.

Basically, they are investing enough in the state that will be very lucrative to the state, that they can negotiate some off of their tax rate. It's not limited to giant companies. Very small, small, and medium companies around here get local and state grants and tax breaks all the time to invest in new ventures.

That doesn’t mean it’s sensible to continue doing so. After decades of tax cuts for large corporations America’s infrastructure is crumbling. The middle class and working poor have continued to pay taxes while they waited to see the benefits of trickle down economics and it has never materialized, instead they are sinking deeper into debt and so is their country. It makes no sense to offer a $600M subsidy/handout to a corporation that already pays no federal taxes and whos CEO’s wealth grows by that amount in a matter of days.