Last month, Amazon announced it had received 238 offers for its brand-spanking-new HQ2 that would employ 50,000 workers. A Seattle Times journalist discovered after looking into the released offers – found a not so small offer from City halls – offering up money and democracy.
A great example is the following – hold onto your seats: Chicago has offered to let Amazon pocket $1.32 billion in income taxes paid by its own workers. Filed under a personal income-tax diversion, the workers must still pay the full taxes, but instead of the state getting the money to use for schools, roads or whatever, Amazon would get to keep it all instead.
“The result is that workers are, in effect, paying taxes to their boss,” says a report on the practice from Good Jobs First, a think tank critical of many corporate subsidies.
Most of the HQ2 bids had more traditional sweeteners, such as Chula Vista, California, which offered to give Amazon 85 acres of land for free (value: $100 million) and to excuse any property taxes on HQ2 for 30 years ($300 million). New Jersey holds the crown in the money game, having offered Amazon $7 billion to build in Newark. The oddest part about all of this are the proposals that would put Amazon on the inside of the government. Some are on a smaller scale – such as Boston who is offering to set up an “Amazon Task Force” of city employees working on the company’s behalf.
These would include a workforce coordinator, to help with Amazon’s employment needs, as well as a community- relations official to smooth over Amazon conflicts throughout Boston. (Uhm can’t Amazon can handle these things itself?) But the most far-reaching offer is from Fresno, California. That city of half a million isn’t offering any tax breaks. Instead, it has plans to give Amazon special authority over how the company’s taxes are spent.
Fresno promises to funnel 85 percent of all taxes and fees generated by Amazon into a special fund. That money would be overseen by a board, half made up of Amazon officers, half from the city. They’re supposed to spend the money on housing, roads and parks in and around Amazon. The proposal shows a park with a sign: “This park brought to you by Amazon,” with the company’s smiling arrow corporate logo.
“The community fund projects would give Amazon credit for the funding of each project,” the proposal says. “The potential negative impacts from a project would be turned into positives, giving Amazon credit for mitigating it.”
Is it even legal to give a company direct sway over civic spending like that? When asked about it, Fresno’s economic-development director threw the public interest under the bus.
“Rather than the money disappearing into a civic black hole, Amazon would have a say on where it will go,” he told the Los Angeles Times. “Not for the fire department on the fringe of town, but to enhance their own investment in Fresno.”
Congress is slashing corporate taxes while business cash is overwhelming elections and the Federal Communications Commission is poised to turn control of the internet over to a few private companies. And now, this. John Oliver broke it down in his John Oliver way here.