Maybe they don’t need the jobs in Queens.
It doesn’t matter now, because they aren’t getting them anyway. Amazon walked away Thursday from a deal to build a new headquarters near the East River, taking with it 25,000 jobs that could have made a difference to the New York City borough.
Blame the New York State Senate, now in the control of Democrats whose scorched-earth opposition incinerated the plan. Senate Majority Leader Andrea Stewart-Cousins made decisions that all but guaranteed the project would fail. It was unfortunate leadership.
Yes, other forces were also at work. Protesters in the community were pushing Amazon away. But she pulled the trigger.
The giant online store announced last year that it was going to build a second headquarters, drawing feverish interest from around the country, including Western New York. In the end, it decided to build two: one in Arlington County, Va., and one in Long Island City.
It was never going to be cheap. Amazon knows its leverage and used it to maximum advantage. But that’s the name of the game these days and either you’re going to play or watch from the sidelines.
To succeed, New York has to play. In one of the nation’s most business-unfriendly states, where taxes are infamously high, attracting any company requires New York to compensate for its significantly greater costs of doing business. That’s just arithmetic.
In the end, New York offered almost $3 billion in state and city tax breaks, and while that was much more than Virginia ponied up, Virginia starts from a less costly place. New York was always going to have to pay more.
At one time, New York City may have been able to rely on its economic dominance and allure to attract businesses who needed or desperately wanted to be there. Those days are gone. The city and the state need to be able to compete. In this case, they weren’t even interested.
Stewart-Cousins poisoned the well when she appointed State Sen. Michael Gianaris to a state board with the power to veto the deal. It was a hostile move producing so much friction that Amazon on Thursday backed out.
True, Amazon is an incredibly wealthy company, as is its owner, Jeff Bezos, whose 2018 income has been estimated at $230,000 a minute. Clearly it doesn’t need the incentives to survive, but the company is publicly traded, with a board of directors and shareholders who want to maximize their returns. In that regard, New York’s costs of doing business make a critical difference, whatever the fantasists who opposed the deal may imagine.
So Amazon pulled the plug, taking with it 25,000 jobs that Queens could have used and, when the next recession strikes – possibly sooner than later – will rue not having. Democrats blew it, and badly.
It’s not just New York City that will suffer, either. After witnessing the reckless conduct of Senate Democrats, other companies are going to think twice before subjecting themselves to a rigged game. What is a business owner likely to conclude, seeing that even a company like Amazon can’t make it work in this state?
There can be problems with incentives. Companies may not produce all the jobs promised, often leaving taxpayers holding the bag. At RiverBend in South Buffalo, there is concern that the state will have to claw back incentives if Tesla doesn’t produce the jobs it pledged.
But business can take unforeseen turns. Sometimes, guarantees run headlong into realities. But here’s the thing: Western New York is better off for Tesla’s presence. Gov. Andrew M. Cuomo created that project through the Buffalo Billion. With the Amazon deal, he was trying to do something similar for Queens and New York City. Queens and New York City said forget it.
Other factors were at play in this governmental train wreck, including legitimate concerns over labor issues, land-use processes and the role of the New York City Council. Maybe they could have been resolved; maybe not. It never got that far because Senate Democrats, unskilled in the use of power, didn’t know what they were doing.
Nice work.
