3 min read

Yesterday, Amazon announced that it will split its second headquarters between New York City and a suburb of Washington, D.C. Specifically into Long Island City, Queens, and Crystal City, in Arlington, Virginia.

Per Amazon, the company will invest $5 billion and create more than 50,000 jobs across the two new headquarters locations, with more than 25,000 employees each in New York City and Arlington. The new locations will join Seattle as the company’s three headquarters in North America.

How did it all start?

The stage was set fourteen months ago when Amazon invited North American cities to apply to compete for getting Amazon’s second headquarters in their cities. Every year, American cities and states spend up to $90 billion in tax breaks and cash grants to urge companies to move among states. After considering applications from nearly 238 cities, Amazon shocked everyone by finally choosing New York and D.C., the two most sought after cities in America.

And to top that, the incentives the company will receive as part of the deals are touching the sky.  Amazon announced that, in New York, it will receive up to $1.2 billion in a refundable tax credit, tied to the creation of jobs, and a $325 million cash development grant. The company will meanwhile earn up to $573 million in cash grants for the Arlington investment if it creates the promised jobs.

What do the people think?

Amazon’s decision was met with backlash and outrage by concerned citizens as well as other people on the internet. People have found Amazon’s decision extremely concerning.

Queens residents are also “outraged” at Amazon’s plans according to Rep.-elect Alexandria Ocasio-Cortez.

Many people have also released statements and drafted open letters to Jeff Bezos disagreeing to Amazon’s decision and highlighting the trouble associated.

David Heinemeier Hansson, the creator of Ruby on Rails has written an open letter addressed to Jeff Bezos terming Amazon HQ2 process demeaning if not outright cruel. “At a time when politicians are viewed as more inept, more suspicious, and more corrupt than ever, you made city after city grovel in front of your selection committee. They debased themselves in a futile attempt to appeal to your grace and mercy, and you showed them little. The losers ended up worse than where they started, and even the winners may well too.”

He wrote, “At some point people are going to have had enough, and when they figure out a way to channel that discontent into political action, they’re going to come looking for the heads of those that did them the most egregious wrongs.

How to control corporate giveaways?

We need a national truce, both within states and between states,” said Amy Liu, the director of the Metropolitan Policy Program at the Brookings Institution. “There should be no more poaching of private companies with public funds.” The Atlantic highlights three ways the government could take control of corporate giveaways:

First, Congress could pass a national law banning this sort of corporate bribery. Second, Congress could make corporate subsidies less valuable by threatening to tax state or local incentives as a special kind of income. Finally, the federal government could actively discourage the culture of corporate subsidies by strict law enforcement measures.

In another striking move, Democratic Assemblyman Ron Kim has announced a bill to block the Amazon deal and redirect taxpayer subsidies for Jeff Bezos into reducing student debt. “Giving Jeff Bezos hundreds of millions of dollars is an immoral waste of taxpayers’ money when it’s crystal clear that the money would create more jobs and more economic growth when it is used to relieve student debt,” said Kim.

Read Amazon’s official press release to know in detail about the new headquarters and Amazon’s incentives in these HQ2.

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