Amazon Corporation Extracts Tax Breaks from Cities Vying for Headquarters

Rikki Baker Keusch
January 2018

With the announcement of the Amazon Corporation’s intention to establish a second headquarters, 238 cities have submitted proposals, the vast majority in the US.1 Local governments are vying for the tens of thousands of jobs and millions, if not billions, in income it could bring to their cities.

Seattle can attest to the job and revenue growth an Amazon corporate headquarters might bring, but it can also provide a warning.  With rising jobs and income, social disparities can quickly follow: housing prices, gentrification, income inequality, and homelessness.

In Seattle, housing prices doubled over the past five years, leading rental rates to skyrocket and making it difficult for middle- and lower-class citizens to afford a home. Additionally, Amazon still lags behind in supporting the local community through charity involvement.2 Unsurprisingly, these changes have correlated with an increase in homelessness, causing Seattle to declare a state of emergency in 2015.3

Still, many cities are ignoring these drawbacks in their attempts to lure the Amazon Corporation, narrowly focusing on the economic benefits. Chicago, already dealing with a struggling public school system, gentrification, and policing that has brought charges of racism, has promised Amazon  $2.25 billion in incentives, mostly from tax breaks, if it locates a second headquarters in the central Chicago area.4 Couldn’t that diversion of tax revenue cause more Chicago Public School closings?

Chicago is not the exception. Cities across the country, many already struggling with growing income inequality and gentrification, are promising tax breaks and free land to one of the most successful multi-billion dollar corporations in the world. Why should a corporation benefit at taxpayer’s expense when it brings larger homeless populations and increased gentrification in its wake?

Since the beginning of November, over 100 community organizations across 23 states, Washington, D.C. and Toronto have signed a letter to Amazon Corporation CEO Jeff Bezos with concerns over Amazon’s potential second headquarters in their cities. Their concerns include out-of-state hiring, gentrification, housing and income inequality, and a lack of Amazon Corporation’s investment in infrastructure.5 There have also been a few dissenting op-eds and community meetings in cities vying for Amazon’s attention. Perhaps the most difficult issue in organizing around this threat is not knowing where the headquarters will open.

A moral, mutually beneficial agreement between a city and Amazon Corporation wouldn’t involve tax breaks and free land, but a promise that the corporation will hire local residents, give back to the community, and open its new headquarters in a way that does not disrupt the life of a city’s residents. Perhaps this could be done by building the headquarters just outside the city rather than in its central district. Unfortunately, Amazon is wielding the upper hand. In a society in which corporations can bribe cities with much needed money, officials often bend-over backwards to meet their demands, ignoring the long-term needs of local residents.   

It is this onerous, illegal power of corporations, a reality in any city that Amazon or another corporation might want to locate, that Move to Amend’s work is challenging. We the People create corporations to be in service to people, their communities and societies. In a real democracy it is the citizens of a community that have the right to decide where corporate activity of any sort may be located and what its privileges of operation will be. Only by taking away the rights and powers corporations were wrongly given over a period of nearly 200 years can we be the democracy we so eagerly proclaim.

Move to Amend’s agenda is to contest this illegitimate power of corporations by working to withdraw all corporate constitutional rights (intended for natural persons only) and the doctrine that money as a form of political speech. Move To Amend’s proposed 28th Amendment, the ‘We the People’ Amendment (House Joint Resolution 48), would put We the People in a position to make real democracy a possibility.


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