Shame on Amazon

And the cities and states that are about to fall all over themselves for the opportunity to knuckle under to it.

The online retail giant recently announced that it’s growing so big and so fast that it needs to establish a second headquarters to go along with the one it already has in Seattle. With this in mind, the company sent out a request for proposals to American and Canadian cities giving them six weeks to get back to Amazon with their explanation of why the company should choose their location for its expansion.

In this request for proposals the company lays out some of the things it’s looking for in a new headquarters city, including a metropolitan area of at least one million people, a diverse population, on-site access to mass transportation, a location within 45 minutes of an international airport, easy access to major highways, good cell phone coverage, strong local colleges and universities, a skilled workforce, appealing cultural and recreational opportunities, and more.

And oh, yes, one other important thing: money.

Or, as the Amazon request for proposals puts it,

Incentives offered by the state/province and local communities to offset initial capital outlay and ongoing operational costs will be significant factors in the decision-making process.

This is nothing new for Amazon. As described by the New York Times, the Institute for local Self-Reliance reports that between 2005 and 2014 the company received more than $600 million in local and state government subsidies for 40 of the 77 warehouses it built during that period and another $147 million for new data centers.

“Brother, can you spare a dime?”

And to be fair to Amazon, which really doesn’t deserve fairness, it’s not alone in receiving such subsidies, as the New York Times reports: the state of Wisconsin is giving Foxconn $3 billion in tax credits to build a $10 billion factory in the state; Washington state, where Boeing has had a major presence now for more than 100 years, is giving that company $8.7 billion in support for projects through the year 2040; Tesla received $1.25 billion in tax credits from the state of Nevada to build a battery factory there; and Aetna will abandon Hartford so it can take advantage of $24 million in tax breaks offered to the company by New York City.

But still…

Let’s put this in a little context.

How much a business is worth is known as its market capitalization. That number comes from multiplying the number of shares of stock a company has issued by the value of that stock on any given day. The higher the market capitalization, the more valuable the company. Based on market capitalization, Amazon was the fifth most valuable company in the world as of September 7, behind only Apple, Alphabet (which is Google), Microsoft, and Facebook and just ahead of Berkshire Hathaway (Warren Buffett’s company). Amazon is worth $465 billion.

Again: Amazon is worth $465 billion.

Amazon is pretty high up in revenue, too: 26th highest in the world, with revenue of $135 billion in 2016.

And last but not least, Amazon’s CEO and largest shareholder, Jeff Bezos, is now the third richest person in the world, behind only Bill Gates and Warren Buffett. How rich? Try $73 billion worth of rich. ( By the way, both market capitalization and individual wealth ratings fluctuate daily based on the value of the stock these rich folks own at any given time. For one day this summer, Bezos briefly was the richest person in the world.)

Again: Bezos is worth $73 billion.

Yet there those Amazon folks are with their greedy hands out, looking for government to subsidize the expansion of one of the richest companies in the world led by one of the richest men in the world. It’s not enough that the company is fabulously successful and the man is incredibly rich. No, they demand to feed at the public teat and pursue greater success and greater wealth at taxpayers’ expense. Can they afford to pay for what they want on their own? Of course they can. They may be more capable of doing so, in fact, than any company and any individual in the world. But why would they, why should they, when they can put out their hands, cry poor, and demand that government give them a handout they neither deserve nor need.

Is it disgusting?

Of course it is.

Is it going to happen?

Of course it is.

Doesn’t it make you feel good, as a taxpayer, to know that even though your government is struggling just to cover its own costs it can still find it in its heart to lend a hand to one of the most valuable companies in the world that’s run by one of the richest people in the world?

 

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