Talk about First World problems.
Ordinarily, Amazon’s announcement on Tuesday that it is planning major expansions in Queens and in Arlington, Va., would sound like good news for those areas. Amazon says it plans to hire 25,000 people in each location at salaries averaging $150,000.
Recall that the appeal of landing Amazon’s HQ2 was so great that more than 200 cities around the country prostrated themselves in embarrassing fashion to try to land it. Now that two of the country’s largest metro areas are splitting the prize, though, some voices are saying the victory comes at too high a cost.
My colleague Jim Swift, who is a good guy, wrote a piece yesterday called “Amazon’s HQ2 Is Going to Suck,” which raised concerns about traffic. National Review panned Amazon’s arrival as a bad deal. Alexandria Ocasio-Cortez said she found Amazon’s plans near her New York district “extremely concerning” because of its potential effects on poor residents and because of tax giveaways. The Atlantic clutched pearls and explained how the arrival of so many high-paying jobs might “accelerate America’s great divergence” between highly educated urbanites and everybody else. And one woman asked Washington’s NBC affiliate, “Where will we park?”
Let’s calm down, people. These concerns are understandable, and it’s wise to be suspicious of a tech behemoth like Amazon striking deals with state and local governments. But they’re also way overblown.
The impulse to complain about the arrival of Amazon’s $150,000-a-year jobs is almost the opposite of usual NIMBY worries about economic development. Often, residents complain about the impending arrival of businesses that bring truly noxious elements to the community—like rendering plants or porn shops or landfills. Here, the threat comes in the form of too many smartly dressed office workers and the money they will spend. That’s a good problem to have.
Washington and New York are so big already that they should have no trouble absorbing 25,000 workers. The Washington metro area employs about 3.4 million workers. The New York metro area has about 10.1 million. Even if Amazon could hire 25,000 workers in each city tomorrow—something that will actually take several years—those workers would represent less than 1 percent of the metro area employment in those regions.
In fact, those metro areas are already accustomed to integrating that many workers. In the last 10 years, the Washington area has added a net 300,000 jobs, according to Labor Department figures. The New York area has added 600,000 jobs. Adding 25,000 from a single company sounds like a lot, but it’s actually not that much compared with what’s already going on in these cities.
It’s like focusing attention on the caravan of Central American migrants. The caravan gets the press, but the more significant story is the far greater number of migrants coming across the border in smaller increments.
Will traffic worsen? Will schools become crowded? Will rents rise? Yes, definitely. But they already are, and the reasons that have nothing to do with Amazon. If you live in a city, your city will likely keep growing. That’s what cities do. They attract people because of their superior job opportunities and cultural amenities. Those advantages are baked into the cost of city living, which features worse traffic and higher costs than in rural areas—but that’s a choice people make after considering the tradeoffs. Growing cities will have to try to manage traffic and affordable housing the way they always have, not always to the satisfaction of long-time residents who see only the downsides.
If you took a job in a city and enjoy its restaurants and parks and museums, you shouldn’t deny that same opportunity to somebody else, even if that person wants to work for a multinational, quasi-monopolistic tech conglomerate like Amazon. It’s far better to live in a growing city than one in decline. These jobs also increase upward pressure on wages and help diversify the local economy, especially in Washington, which thrives when the federal government is thriving (which seems to be always).
The most detestable part of the Amazon deal, of course, is the incentives New York and Virginia offered—a total of $5.5 billion—to one of the world’s wealthiest companies. Of all the cities that sought to land Amazon, New York and Washington seemed to be in the best position to avoid sweetening the deal, since they’re less desperate and more stocked with tech talent, which Amazon says was the driving factor in its decision. Offering special incentives to massive companies such as Amazon is unfair to small businesses, which enjoy no such government subsidies. People from across the ideological spectrum, from Ocasio-Cortez to Tucker Carlson, agree on this.
Still, those communities come out ahead economically, because the incentives are tied to the actual creation of jobs and investment, which increases tax revenues above the amount of the incentives. And that doesn’t even include the effect of ancillary jobs that will be created from Amazon vendors that will likely set up shop nearby.
Early in my journalism career, I covered the city council in Gastonia, North Carolina, a city of about 75,000 residents just outside of Charlotte. At what seemed like every meeting, the mayor and council members would discuss various downtown revitalization projects in an attempt to lure business—any business—into the struggling downtown and its boarded-up buildings. They lined the streets with new flowerbeds. They tinkered with tax-rebate incentives. Results never seemed to materialize, though I recall them celebrating when a single Mexican restaurant opened up. They would have killed for just 10 $150,000 office jobs—heck, probably even five.
New York and Washington are poised to get 25,000 such jobs. Instead of fretting, why not celebrate the victory as an affirmation that you’re in a thriving, growing city that is a desirable place to live?
