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Amazon HQ2's influence on Politics - Direct and Future Implications (1 Viewer)

Koya

Koya

Footballguy
As some know, I'm involved in real estate development / place-based economic development, so have been following the Amazing HQ2 "competition" and debate closely.  There are a number of significant political implications of this huge undertaking, which I figured might be worth discussing here - both as they pertain to the HQ2 search and decision proper, or future efforts to attract/grow a corporate workforce and economy, innovation and traditionally oriented. 

I thought this might be interesting, because we are watching folks from each side of the aisle act in some ways either contradictory to their past stated platforms, and/or even perhaps against their own long term benefit regarding the power Politics angle (something you almost NEVER see).  As such, a few issues come to mind, and we can get to others later, but let's start with the whole issue of tax incentives for economic development, using North Carolina in this case, but can pertain to other states be it Amazon or general economic development related.  I think similarities arise in a number of red states that are wooing a dyed in blue company and culture (Texas, which as a strong rural vs. city divide as well with many similarities, and is more and more purple each year... Florida as well in a somewhat different way, but a lot of similarities)

Tax incentives: If Amazon brings tens of thousands of new jobs, it's own mini-economy with ancillary and support businesses along with the services needed for this new workforce, can that be enough fiscal benefit to overcome the promise of upwards of 5-7 BILLION in tax incentives?  We talk about corporate welfare, what would be more an example of that than giving billions to the world's wealthiest man and a company with one of the if not the largest market cap in the world?

Amazon specific: Is the juice worth the squeeze here, ESPECIALLY if a region will need to likely invest MORE billions on ongoing infrastructure, especially transportation related, not to mention schools etc for this new population and economic activity. 

In General: Should the nation begin to eschew these tax giveaways, which are used to essentially bribe (legally, mind you) a company to move to or stay in an area - again, when you consider the need to provide supportive infrastructure for residents and businesses, especially in high cost-low efficiency areas (i.e. many established suburbs), how many times does a region/locality actually end up paying out more to get business between tax breaks and supportive infrastructure and other municipal costs than it generates in new tax revenues?

 
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Another interesting twist: Anti-City, Anti-Transit, Anti-LGBTQ: But HQ2 and Amazon will want all that stuff

Raleigh and the research triangle are listed as one of the 20 finalists.  Now, between gerrymandering and a general disdain for all things "Urban" or "cosmopolitan" (including transit investment, or in Raleigh itself as the State Capital, an almost backward focus on suburban auto-oriented growth, even with some popping in its downtown, the state's notorious anti-gay legislative efforts), NC has not exactly been a state that has embraced the ideals you'd think Amazon stands for / it's workforce represents.

Yet, they are competing for HQ2, which would both require significant levels of urbanization and expansion of mobility options including transit in all likelihood, things you'd think they'd be against.  Just an odd dichotomy.

ETA: This again could be a conversation here in Texas, although there has been a much stronger pull from the cities and the business-oriented communities traditionally than NC (including many conservatives and evangelicals even) that have less disdain for transit, more willingness to not push for LGBTQ legislation etc).

The irony is NC is more blue as an electorate than Texas, but it's legislature is so dominated by the right, the actual landscape is far less liberal and even less business friendly as a result, in an ironic twist.

 
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rockaction said:
Geez, what areas are you talking about, Koya? That's important. 

In general: No, it's not worth it. It's like a professional sports franchise, I'd imagine.  
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Clarified in the OP. My bad

 
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Koya said:
When you say what areas, what do you mean? Which areas in NC? I'll list
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Um, no. It wasn't specified in the OP, at least to the best of my reading. If it's NC, then it doesn't matter, because that's as foreign to me as anything, really. I couldn't speak to NC politics to save my life. 

What's really driving your question? I might have a good answer, or not.  

 
rockaction said:
Um, no. It wasn't specified in the OP, at least to the best of my reading. If it's NC, then it doesn't matter, because that's as foreign to me as anything, really. I couldn't speak to NC politics to save my life. 

What's really driving your question? I might have a good answer, or not.  
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What is driving my question is the many issues that the huge impact of HQ2 represents has brought to light.

From should we invest in economic development by incentives, or focus those dollars in things like infrastructure, better local services and programs, and/or lowering the local tax burden, to how do areas that have been anti-city anti-transit and anti-LGBTQ justify that position with doing what Amazon would want in a region, which is quite the opposite of that, to the next issue I'll bring up...

 
Very specific to North Carolina, but implications in say Florida or Texas and other purplish states: Voting themselves out of future office and power?

N.C. already is about 50-50 split, and gerrymandering has come under a good amount of scrutiny and attack... IF they win Amazon, how does that literally balance the scales of the electorate?

Furthermore, areas like Texas, NC and Florida, if they look to build their corporate and knowledge sector base, are almost by definition looking to cater to and actually bring in folks that are likely to vote in the opposite direction of those who have traditionally held power for the last couple decades, or more. By seeking the Amazon and other similar companies, what effect does that have 5-10 years from now even, in terms of turning a state potentially blue?

 
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Koya said:
Very specific to North Carolina, but implications in say Florida or Texas and other purplish states: Voting themselves out of future office and power?

N.C. already is about 50-50 split, and gerrymandering has come under a good amount of scrutiny and attack... IF they win Amazon, how does that literally balance the scales of the electorate?

Furthermore, areas like Texas, NC and Florida, if they look to build their corporate and knowledge sector base, are almost by definition looking to cater to and actually bring in folks that are likely to vote in the opposite direction of those who have traditionally held power for the last couple decades, or more. By seeking the Amazon and other similar companies, what effect does that have 5-10 years from now even, in terms of turning a state potentially blue?
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Depends what kind of workforce you're employing, I guess. We saw this in VA with the Dulles strip and Ted Leonesis and AOL. That's a very good question. At what point do entrenched social and financial mores become a tipping point? 

I'm not sure about Texas, but Florida is certainly up for grabs.  

 
rockaction said:
Depends what kind of workforce you're employing, I guess. We saw this in VA with the Dulles strip and Ted Leonesis and AOL. That's a very good question. At what point do entrenched social and financial mores become a tipping point? 

I'm not sure about Texas, but Florida is certainly up for grabs.  
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The reason I think Texas might be impacted by this specifically issue more than Florida is simply its place as a magnet for economic growth and corporate relocation.  Already, you have many business-oriented conservatives/Republicans who want no part of bathroom bills and are willing to invest in Transit because they see the benefits economically - so the state doesn't need to "turn" ala North Carolina to see some more left-leaning policies get and maintain support. 

Long term, Texas is becoming more blue, and unless the Republican party takes a significant correction in the next decade (which is certainly possible with the mess that is today), the demographics are just no in their favor to begin with, and would only be accelerated with continued and expected growth in the types of workforce that is fueling most of this growth.

What fascinates me about NC is that the state is already basically 50-50. The confluence of continued trends and rulings against Gerrymandering threaten to unlock the Republican hold on power. IF you added 50k amazon employees to that mix, it could have a real and fairly short term impact, without parallel that I can find. 

 
Koya said:
The reason I think Texas might be impacted by this specifically issue more than Florida is simply its place as a magnet for economic growth and corporate relocation.  Already, you have many business-oriented conservatives/Republicans who want no part of bathroom bills and are willing to invest in Transit because they see the benefits economically - so the state doesn't need to "turn" ala North Carolina to see some more left-leaning policies get and maintain support. 

Long term, Texas is becoming more blue, and unless the Republican party takes a significant correction in the next decade (which is certainly possible with the mess that is today), the demographics are just no in their favor to begin with, and would only be accelerated with continued and expected growth in the types of workforce that is fueling most of this growth.

What fascinates me about NC is that the state is already basically 50-50. The confluence of continued trends and rulings against Gerrymandering threaten to unlock the Republican hold on power. IF you added 50k amazon employees to that mix, it could have a real and fairly short term impact, without parallel that I can find. 
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Nice analysis. I've kinda been out of the day-to-day with politics so it's cool to get a real perspective. Texas certainly is a magnet, but there will be new magnets. It's so interesting to watch low-tax, low-regulation states draw businesses and jobs and then vote them out with higher taxes and more regulatory structures. I'll never be less amazed, but that's the cycle.   

 
rockaction said:
Nice analysis. I've kinda been out of the day-to-day with politics so it's cool to get a real perspective. Texas certainly is a magnet, but there will be new magnets. It's so interesting to watch low-tax, low-regulation states draw businesses and jobs and then vote them out with higher taxes and more regulatory structures. I'll never be less amazed, but that's the cycle.   
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San Fran and NYC are two of the highest cost of business centers in the nation (the top two, continental US?) yet are complete magnets for new growth because the talent wants to be in those enviornments, and the interactions that occur with the density and activity are quite beneficial for many innovation and collaborative companies/environments. They aren't chasing people away, and have always been high regulation, high cost (taxes and everything else).

That said, you are getting a rare commodity (that really high energy level of super urbanism) in those locations that simply isn't available almost anywhere else.  To your point, your high cost high regulation suburbs are definitely hurting - once you have cookie cutter (albeit night) suburbia, it's a commodity.  You can get the similar experience, street and house layout/design, stores/brands across the country, so cost becomes a determining factor. The cost vs. good schools vs. space/yard vs. just how far do I have to be from work analysis doesn't work when you are Long Island, a costly pain in the ### to do business, don't have environments that attract young people anyway and there's Texas or Salt Lake City with far less cost of living for employees, less taxation across the board and certainly more biz friendly from a regulatory environment. 

But, again, when were these areas ever really low tax, low reg?

 
Koya said:
San Fran and NYC are two of the highest cost of business centers in the nation (the top two, continental US?) yet are complete magnets for new growth because the talent wants to be in those enviornments, and the interactions that occur with the density and activity are quite beneficial for many innovation and collaborative companies/environments. They aren't chasing people away, and have always been high regulation, high cost (taxes and everything else).

That said, you are getting a rare commodity (that really high energy level of super urbanism) in those locations that simply isn't available almost anywhere else.  To your point, your high cost high regulation suburbs are definitely hurting - once you have cookie cutter (albeit night) suburbia, it's a commodity.  You can get the similar experience, street and house layout/design, stores/brands across the country, so cost becomes a determining factor. The cost vs. good schools vs. space/yard vs. just how far do I have to be from work analysis doesn't work when you are Long Island, a costly pain in the ### to do business, don't have environments that attract young people anyway and there's Texas or Salt Lake City with far less cost of living for employees, less taxation across the board and certainly more biz friendly from a regulatory environment. 

But, again, when were these areas ever really low tax, low reg?
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I guess this is what you get when you talk to urban developers. Thanks for the perspective. That sounds cold and distant, but isn't. Your point about the Island, or CT even, would be well-taken with me. I've always wondered about this stuff. 

Hey, what do you think about Robert Moses? When you get the time or if you're so inclined...

 
rockaction said:
I guess this is what you get when you talk to urban developers. Thanks for the perspective. That sounds cold and distant, but isn't. Your point about the Island, or CT even, would be well-taken with me. I've always wondered about this stuff. 

Hey, what do you think about Robert Moses? When you get the time or if you're so inclined...
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A lot of it is evolution of a place, rooted around the reality that suburbia as we know it is a huge (and relatively very recent) phenomena, and as forwarded by some of the best minds, the greatest (arguably failed) experiment of all time. Literally, tens of thousands of years of living generally constrained by the distance of walking, and at best horses for "long" trips.  Then like 60 years ago, we stopped building places for people, and built them for cars.

Huge unforeseen consequences that are just being realized today (i.e., after about 25-30 years, most suburban development patterns can't and don't produce the necessary tax revenues for their needed replacement and ongoing maintenance after that; or the forseen and very much intended racial and economic divides that in many ways became more of a segregating factor than cities and towns had ever been before, if only because of the option for "distance" in a literal sense).

That's not to say suburbia is bad, but it's something we are now adjusting to - in terms of the market that wants more urban options (not more than suburban, just more options than are available now, which is why it's so much more expensive to live in cities, almost large and small, as compared with their auto-oriented counterparts in that same region), and in terms of governments going bankrupt because at some point a pyramid scheme no longer has the new money (i.e. new homes and "easy" development patterns) to keep itself afloat.

We are there. As in, some municipalities have literally torn up their roads to go back to dirt roads because they weren't deriving enough tax revenues to maintain the asphalt. 

ANYhoo - a lot of this has huge political implications.  Locally, state and federal - though there are so many constraints at a federal level, which people are disassociated with and don't recognize, while also hyper local issues that make these issues all the worse such as anti-growth, anti-urban (even small scale, like local downtown environment, not "city" like) crowds that insist on only building in the same manner that has them teetering on bankruptcy with crippling municipal debt. 

Robert Moses is also a huge Political issues.  He had great and grand visions, but literally destroyed neighborhoods, and seemingly didn't care (although later in life, some suggest he recognized some of these errs in his ways)... in terms of segregation above, this is all I need to say about Moses:

The original highways that connected NYC to Long Island / the suburbs were Parkways. Called parkways because they literally ALL ended up in some large park - with miles and miles of roads to be developed and devoured by houses, then retail strips, then malls and supercenters along the way.  However, these parkways, to this day, have low hanging bridges where trucks, for example, can't go under.

Do you know why they built such low bridges?   Because buses (aka black and brown people movers) then could not access either the parks, or the new suburban neighborhoods being built in between.

 
Koya said:
A lot of it is evolution of a place, rooted around the reality that suburbia as we know it is a huge (and relatively very recent) phenomena, and as forwarded by some of the best minds, the greatest (arguably failed) experiment of all time. Literally, tens of thousands of years of living generally constrained by the distance of walking, and at best horses for "long" trips.  Then like 60 years ago, we stopped building places for people, and built them for cars.

Huge unforeseen consequences that are just being realized today (i.e., after about 25-30 years, most suburban development patterns can't and don't produce the necessary tax revenues for their needed replacement and ongoing maintenance after that; or the forseen and very much intended racial and economic divides that in many ways became more of a segregating factor than cities and towns had ever been before, if only because of the option for "distance" in a literal sense).

That's not to say suburbia is bad, but it's something we are now adjusting to - in terms of the market that wants more urban options (not more than suburban, just more options than are available now, which is why it's so much more expensive to live in cities, almost large and small, as compared with their auto-oriented counterparts in that same region), and in terms of governments going bankrupt because at some point a pyramid scheme no longer has the new money (i.e. new homes and "easy" development patterns) to keep itself afloat.

We are there. As in, some municipalities have literally torn up their roads to go back to dirt roads because they weren't deriving enough tax revenues to maintain the asphalt. 

ANYhoo - a lot of this has huge political implications.  Locally, state and federal - though there are so many constraints at a federal level, which people are disassociated with and don't recognize, while also hyper local issues that make these issues all the worse such as anti-growth, anti-urban (even small scale, like local downtown environment, not "city" like) crowds that insist on only building in the same manner that has them teetering on bankruptcy with crippling municipal debt. 

Robert Moses is also a huge Political issues.  He had great and grand visions, but literally destroyed neighborhoods, and seemingly didn't care (although later in life, some suggest he recognized some of these errs in his ways)... in terms of segregation above, this is all I need to say about Moses:

The original highways that connected NYC to Long Island / the suburbs were Parkways. Called parkways because they literally ALL ended up in some large park - with miles and miles of roads to be developed and devoured by houses, then retail strips, then malls and supercenters along the way.  However, these parkways, to this day, have low hanging bridges where trucks, for example, can't go under.

Do you know why they built such low bridges?   Because buses (aka black and brown people movers) then could not access either the parks, or the new suburban neighborhoods being built in between.
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Fascinating, bud. Thanks for replying. I actually saw, in Hartford, a bus literally clang off of a bridge -- taking its top off. I'd imagine property and segregation had a lot to do with it, and anything you have in the future would provide me with more knowledge of this. 

Moses, as far as through the lens which I can discern, which is baseball and Brooklyn and the Mets, was definitely one of the most powerful people in America. That's all I can say about the subject.  

 
@rockaction - A lot of what I wrote above, and a lot about balanced urbanism to begin with, is rooted in conservative ideals. You should check out the site of a well known conservative / libertarian, Chuck Marohn, who runs the Strong Towns website, which has a ton of what is called market urbanism coupled with tremendous fiscal conservancy (in fact, he became interested in these issues when as a traffic engineer, he kept telling his bosses that the plan they had will simply funnel money out the door 20-25 years down the road and was not at all a responsible way to build / develop / invest in infrastructure - to the point they fired him and he found his new calling).

There's also a growing movement at the generally left Congress for the New Urbanism with conservative participants.  I've become colleagues / friends with a writer for the American Conservative for example, who espouses how most neighborhoods make building what the market wants literally illegal (mix of uses, not enough parking on site, any other number of issues) while tying the hands of private land owners (gov't saying you can't built a granny flat, or an accessory dwelling unit, on your own land!).

Bringing this back to NC, at the Light Rail forum I put on and spoke at last week, this writer was a participant providing just that point of view. You have a super liberal area like Durham, who then look to force the cost of the huge affordable housing issue on the backs of developers and (very limited) new construction.. while they constrain the market, won't allow innovative solutions for new but appropriate densities and the like - this time the left, not the right, putting into play policies that result in the exact opposite outcome than they say they desire.

 
Koya said:
@rockaction - A lot of what I wrote above, and a lot about balanced urbanism to begin with, is rooted in conservative ideals. You should check out the site of a well known conservative / libertarian, Chuck Marohn, who runs the Strong Towns website, which has a ton of what is called market urbanism coupled with tremendous fiscal conservancy (in fact, he became interested in these issues when as a traffic engineer, he kept telling his bosses that the plan they had will simply funnel money out the door 20-25 years down the road and was not at all a responsible way to build / develop / invest in infrastructure - to the point they fired him and he found his new calling).

There's also a growing movement at the generally left Congress for the New Urbanism with conservative participants.  I've become colleagues / friends with a writer for the American Conservative for example, who espouses how most neighborhoods make building what the market wants literally illegal (mix of uses, not enough parking on site, any other number of issues) while tying the hands of private land owners (gov't saying you can't built a granny flat, or an accessory dwelling unit, on your own land!).

Bringing this back to NC, at the Light Rail forum I put on and spoke at last week, this writer was a participant providing just that point of view. You have a super liberal area like Durham, who then look to force the cost of the huge affordable housing issue on the backs of developers and (very limited) new construction.. while they constrain the market, won't allow innovative solutions for new but appropriate densities and the like - this time the left, not the right, putting into play policies that result in the exact opposite outcome than they say they desire.
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Yeah, I'd read a bit about this in Reason magazine through Jesse Walker. He'd talked about Moses, and I'd known about Moses through the Long Island parkways from a PBS special. 

And holy...your last paragraph. We've seemed to divide the old wealth and up-and-coming so well it's like a tense string on a guitar. It barely exists, and only in the right notes. Perhaps that's an imperfect analogy, but we've priced out the people that need to live in densities that need them. It's crazy. I remember the firefighters of Old Lyme, CT. They can't afford to live there because of the prohibitive cost of housing, so they bus in firefighters? This seems crazy to me.   

But, thanks for commenting. I can't comment much further.  

 
All I know is please don’t let it be Atlanta our traffic is brutal already.  Unless they want to hire me and pay me phat stacks.

 
Amazon has cancelled the NYC piece of HQ2.

"We do not intend to reopen the HQ2 search at this time," Amazon said. "We will proceed as planned in Northern Virginia and Nashville, and we will continue to hire and grow across our 17 corporate offices and tech hubs in the U.S. and Canada."
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@Koya Very interesting conversation between you and RA above. How do you think Amazon's Nashville development will affect us (if you're familiar with what they're doing here)?

 
VandyMan said:
Amazon has cancelled the NYC piece of HQ2.

@Koya Very interesting conversation between you and RA above. How do you think Amazon's Nashville development will affect us (if you're familiar with what they're doing here)?
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Is love to see Nashville pick up the pieces here.  Not sure if that’s an option or not, but I guarantee you Nash wouldn’t turn down the opportunity to get HQ2

 
shader said:
Is love to see Nashville pick up the pieces here.  Not sure if that’s an option or not, but I guarantee you Nash wouldn’t turn down the opportunity to get HQ2
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I hope they would turn down that kind of spending (it would also hugely change what they have going on now downtown (definitely not room I wouldn't think for this).

 
Koya said:
Another interesting twist: Anti-City, Anti-Transit, Anti-LGBTQ: But HQ2 and Amazon will want all that stuff

Raleigh and the research triangle are listed as one of the 20 finalists.  Now, between gerrymandering and a general disdain for all things "Urban" or "cosmopolitan" (including transit investment, or in Raleigh itself as the State Capital, an almost backward focus on suburban auto-oriented growth, even with some popping in its downtown, the state's notorious anti-gay legislative efforts), NC has not exactly been a state that has embraced the ideals you'd think Amazon stands for / it's workforce represents.

Yet, they are competing for HQ2, which would both require significant levels of urbanization and expansion of mobility options including transit in all likelihood, things you'd think they'd be against.  Just an odd dichotomy.

ETA: This again could be a conversation here in Texas, although there has been a much stronger pull from the cities and the business-oriented communities traditionally than NC (including many conservatives and evangelicals even) that have less disdain for transit, more willingness to not push for LGBTQ legislation etc).

The irony is NC is more blue as an electorate than Texas, but it's legislature is so dominated by the right, the actual landscape is far less liberal and even less business friendly as a result, in an ironic twist.
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What are the anti-gay efforts?

 
sho nuff said:
shader said:
Is love to see Nashville pick up the pieces here.  Not sure if that’s an option or not, but I guarantee you Nash wouldn’t turn down the opportunity to get HQ2
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I hope they would turn down that kind of spending (it would also hugely change what they have going on now downtown (definitely not room I wouldn't think for this).
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Definitely not room for something on the scale of what Amazon had planned for NY. No. The project they already announced here is way smaller, but still a big deal for a town this size.

 
VandyMan said:
Amazon has cancelled the NYC piece of HQ2.

@Koya Very interesting conversation between you and RA above. How do you think Amazon's Nashville development will affect us (if you're familiar with what they're doing here)?
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I know a couple people mentioned me - have a ton of notifications as I rarely check the boards nowadays.  As some no, I've taken an extended (and potentially permanent) break from the board due to the nature of limiting certain conversations and not enabling us to speak freely, even when doing so in as respectful a manner as possible considering the ugly realities of which we wish to speak.

FWIW, I've written a number of articles on this very subject.  If you PM me and want to know more, I seem to log in every month or so to check on baseball drafts and ####.  All the best!

 
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