Amazon's corporate welfare
There was much self-congratulating in New York City and Arlington, Virginia recently, when those two locations "won" the honor of having a new Amazon headquarters in their respective jurisdictions. While we admit to using Amazon frequently for purchases, we are still taken aback by politicians rushing to give the company billions of taxpayer dollars in order to seal the headquarters deals.
The Wall Street Journal notes how New York, in particular, has decided to extend Amazon all the corporate welfare it wants at the expense of the city's poor. In this case, New York allowed its public housing to fall into such disrepair, it became the object of a federal lawsuit:
This summer the Justice Department sued Nycha for sweeping its disrepair under a shabby rug. Nycha agreed to a court-appointed monitor to oversee $1.2 billion in repairs over the next five years. On Wednesday in a 52-page ruling, federal Judge William Pauley III, a Bill Clinton appointee, rejected the settlement as inadequate and perhaps unconstitutional.
According to the New York State Department of Public Health, 83% of Nycha’s inspected units contained a hazardous condition. “Somewhat reminiscent of the biblical plagues of Egypt, these conditions include toxic lead paint, asthma-inducing mold, lack of heat, frequent elevator outages, and vermin infestations,” the judge noted, adding that the authority “whitewashed these deficiencies for years.”
While Mayor de Blasio agreed to spend an additional $1.2 billion to fix Nycha’s 326 complexes that house 400,000 people, conditions are so awful that the authority estimates it needs $32 billion for repairs. “NYCHA’s current capital needs would not be met until the year 2166,” the judge wrote.
These problems were actively ignored and covered-up for years. Now, the bill to fix those problems will be in the tens of billions of dollars. But when a tech giant promises new jobs? New York politicians -- and politicians in more than 200 other localities -- jumped at the chance to hand over billions worth of cash and incentives.
It's unseemly. It's morally repugnant, and economically illiterate. It's also common, as state and local governments increasingly use taxpayer resources to lure business to their areas. The aim is economic development -- new jobs, more revenue, and benefits for everyone.
It all comes at someone's expense -- taxpayers, local businesses, and so on. And we must never forget what it is: welfare for corporations.