October 19th is the due date for interested cities to bid to become the home of Amazon’s second headquarters, dubbed “HQ2.” Based on earlier reports, Irvine Company (presumably in partnership with the City of Irvine) may be submitting its proposal in hopes of bringing Amazon to our community. Since Amazon announced its search in September, the company has been waving the prospect of 50,000 new jobs in front of city leaders everywhere. We welcome the idea but caution the taxpayers and the City of Irvine to watch out. Here is why:
In its request for proposals, Amazon provided a laundry list of the kind of things that any family would look for, if they are moving to a new city -- great schools, cultural diversity, functioning public transit, excellent cellphone and fiber optic coverage, access to museums and theaters. Sounds great, doesn’t it? Who would not want these folks as neighbors -- they sound just like us!
Of course, what Amazon is also looking for, is a “stable and business-friendly and tax structure,” coupled with “incentives...to offset initial capital outlay and ongoing operational costs…”
In other words, they would like us, the tax-paying public to subsidize their move, and to keep subsidizing their business for years to come. This is an inevitable fact. Look no further but at the relationship between The Walt Disney Company & the City of Anaheim.
But no city is a venture capital firm, and it is not our place to be underwriting the business of one of the richest men in America.
Our city councils, mayors, and state representatives have choices to make in deciding how to spend our tax dollars. Are they using them to improve our schools for everyone, so that our kids have a chance to become someone great? To reduce homelessness? To improve public transit to ensure that people can get to work with the least environmental impact? To provide cultural and recreational activities that are open to everyone in our communities?
Or are they using it to chase jobs from one of the wealthiest companies in the United States? A company that Seattleites say has contributed to an affordable housing crisis there? A company that recent research has shown keeps jobs in the logistics industry low-wage and precarious? A company that avoided paying state sales taxes for more than a decade, because they were selling over the internet, not from a brick and mortar store? A company whose success has come at the expense of small businesses all over the country, including here in Orange County?
Let us ask some serious questions about these job promises. Good Jobs First, which tracks public subsidies of corporate America, notes that the average “price” of a subsidized job has risen exponentially in the last decade. Since 2006, the average “megadeal” that has made for the purpose of corporate economic development has risen from $2.2 million per year to about $7.7 billion per year. Yes, billion, with a “B.” That means each of these jobs can “cost” roughly $658,000 per year.
We should be investing our public funds into the things our city and state needs and Amazon should be paying into that public fund, not depleting our resources. Even if the jobs that are created pay $100,000 or more per year, we do not see how we will possibly recover that money lost in incentives and subsidies into our public coffers -- not to mention that the influx of high wage earners would raise housing prices for all of us.
How will Amazon make sure that the jobs they create are available to people who have lived here for years? We have some suggestions. Make sure that Amazon hires people from underrepresented communities, particularly women and people of color. Make sure that, if Amazon does come, it partners with our schools to train our kids to be lifelong learners, so they can succeed in today’s economy. Beyond jobs, we want Amazon to support and fund affordable housing and equitable public transit, so that their presence does not make ours impossible.
We have made our homes in the County of Orange for years, there is much to love about our county. But before we go too far down the road of cheering ourselves into a deal with Amazon, we ought to make sure that we have got an Amazon Wish List of our own.
Shakeel Syed, Executive Director, OCCORD
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