America is not a democracy. We are a corporate oligarchy who socializes its losses and privatizes its gains. Climate change is the avatar for this dynamic. The United States is the biggest polluter in history, which has led to a warming planet—creating more dire weather events which harm the populace far more than the companies primarily responsible for them. We have made a conscious choice to deal with the disasters after the fact, rather than enforcing rules on the polluters to try to reverse this literal planet-destroying trend. Our present predicament proves indisputably that the United States of America serves its corporations before its people. By definition, that is not a democracy. That’s a corporatocracy.
So enter Amazon (who treats their 90,000+ warehouse employees like cattle). They are the living embodiment of our complete and utter capitulation to America’s investor class. Initially, they gained fame because they flew in the face of conventional modern investment logic. In the 1960s, people held stocks for an average time of four to eight months. Now, it’s a few weeks. Amazon went years without making profits, and that was how the company was always described. Sure, they reported losses year after year because they were investing in the long-term health of their company, but that was framed as an affront to the real reason for their existence: dividends for investors.
Once Amazon’s long-term strategy paid off, they became the darlings of the investor class, and Jeff Bezos entered and subsequently surpassed their stratosphere, en route to becoming the world’s richest man. Now, the very same dance that investors made him do is being forced upon America’s public spaces by Jeff Bezos himself. Today, Amazon released their finalists to host their 2nd headquarters. The small-town HQ dream is dead. All that’s left are the usual suspects.
Amazon’s pitch is that they will bring their behemoth to your backyard, dragging a bunch of jobs and cash with it. In order for our corporate overlords to bestow their graces upon us, a city must give something up in return, and some of the offers are downright outrageous. You cannot look at this situation and still believe that America believes in its citizens more than its biggest companies. Here is a handful of the most egregious examples.
— Chicago offered to give the $1.32 billion they will collect in taxes from Amazon’s workers to Amazon.
— Boston offered to create an “Amazon Task Force” of public officials working on behalf of the company.
— Fresno offered to funnel 85% of all taxes and fees paid by Amazon in to a fund overseen by a board run by Amazon and the city. The fund would spend money on public works around HQ2.
— The Bay Area Proposal in California ensures that the government would set up an Amazon task force to “facilitate and expedite all permits and approvals.”
— New Jersey offered a simple, old fashioned payout of a whopping $7 billion in tax breaks.
Fresno’s economic-development director practically put the kibosh on the concept of publicly funded projects, saying, “rather than the money disappearing into a civic black hole, Amazon would have a say on where it will go. Not for the fire department on the fringe of town, but to enhance their own investment in Fresno.”
On a certain level, that kind of brutal honesty is far more refreshing than the norm, where a city like Chicago can take $1.32 billion from lower-level workers, hand it to executives, and still call it capitalism. The hoops that Amazon is forcing this country to jump through have no equal on the citizenry side. America is a giant public-works project which—nearly 250 years after its inception—cannot agree that public goods should benefit the public. Our political debates take place in the arena of the investor class—win or lose, they win. The only question is how much we lose. If Amazon is requiring cities to practically open up an Amazon embassy inside City Hall, then the return must be pretty damn good. So what will Amazon’s HQ2 give to cities?
Fifty thousand jobs. Jobs are like Beetlejuice in American politics. Say the word often enough, and people believe they will just appear and magically solve all our problems. There is no reason to believe that Amazon is lying with this figure, as their current headquarters in Seattle employs 40,000 workers—with plans to expand it to 55,000. That’s not nothing. Amazon has a desirable offer too—the question is whether what America’s cities are offering is proportional. The answer is: hell no.
There is plenty of discussion about what kind of additional economic benefits those 50,000 jobs will bring, and much of that is up for debate, save for housing. Wherever Amazon goes, housing will become more expensive. For some areas, this may be a good thing, but as the neighborhoods within and around Silicon Valley demonstrate on a daily basis, distorted housing prices lead to increased homelessness. It’s simple logic. When these 50,000 Amazon employees move in, housing becomes more expensive for existing residents—forcing many to move out. Some will have nowhere to go, and they will wind up on the streets. Since this is a column about corporations, we’ll set aside the affront to humanity that is our broad acceptance of homelessness, and just talk about the dollar cost of pushing someone to the forgotten layer of our militaristic society (where nearly 40,000 veterans reside).
In 2012, Shaun Donovan—the Secretary of Housing and Urban Development—said on The Daily Show “that between shelters and emergency rooms and jails, it costs about $40,000 a year for a homeless person to be on the streets.” New York City owns the highest homeless population in the United States—so using Donovan’s figure, it costs them nearly $3 billion each year to maintain this depressing state of affairs. Again, New Jersey is offering Amazon $7 billion in tax breaks. The costs of just the homelessness aspect of the housing impact are in the same ballpark of what cities are offering Amazon. If we’re going to argue that this is purely about getting more dollars into state coffers, then not considering the housing aspect to the Amazon decision does your argument a gigantic disservice. People need affordable housing more than they need jobs. Jobs are meaningless if they’re not easy to get to.
“But Jacob! Those 50,000 jobs will bring more jobs with them, as a new wave of supply must meet Amazon’s wave of demand.”
This is very true, you’d definitely need a grocery store in this new Amazon neighborhood. Say, Whole Foods? Oh right. Amazon owns that. It doesn’t end there either. If Seattle is any indication of what Amazon’s HQ2 will look like, Amazon will own the whole block. I implore anyone with their city in Amazon’s crosshairs to read this photo essay of Seattle’s Amazon neighborhood. Per Harrison Jacobs in Business Insider:
Amazon’s real-estate director, John Schoettler, told The Seattle Times that Amazon built the [scenic] domes not just for employees, but “for the city.” They will not be open to the public, but Amazon has said it is looking for ways to bring in visitors.
There is a strange vibe that Amazon controls everything. Amazon security guards questioned this photojournalist about what she was doing — on public property. Shortly after, the guard began filming me, saying Amazon documents all media personnel. I hadn’t identified myself as a reporter.
Some former restaurant employees said Amazon security guards micromanaged shops and tracked when they close. One restaurant owner likened Amazon to “Big Brother.” Chris Keff, a James Beard Award-winning chef, sold her restaurant Flying Fish when she found she was just breaking even.
Amazon owns the whole block and then some in Seattle, so many of the small businesses entering this new HQ2 will certainly still be within Amazon’s purview. Not to mention, most of the companies who moved in to Seattle’s Amazonland were Facebook, Google, Apple, Microsoft and Uber. There isn’t much room for startups in the land of giants, and America is dedicated to serving our economic titans. We claim to be a people who pull ourselves up by our bootstraps, except the government hands them over to behemoths like Amazon before we can even get a chance to put our bootstraps on. We’re complicit in this, as we justify our support for this theft by promising ourselves that we will be its beneficiaries one day.
Wake up. We won’t. This isn’t capitalism. This isn’t democracy. We are simply servants to our corporate overlords, and Amazon HQ2 is a gigantic flashing billboard exemplifying our inherent societal inequality. Per the New York Times in an article from 2012:
At least five large studies in recent years have found the United States to be less mobile than comparable nations. A project led by Markus Jantti, an economist at a Swedish university, found that 42 percent of American men raised in the bottom fifth of incomes stay there as adults. That shows a level of persistent disadvantage much higher than in Denmark (25 percent) and Britain (30 percent) — a country famous for its class constraints.
Meanwhile, just 8 percent of American men at the bottom rose to the top fifth. That compares with 12 percent of the British and 14 percent of the Danes. Despite frequent references to the United States as a classless society, about 62 percent of Americans (male and female) raised in the top fifth of incomes stay in the top two-fifths, according to research by the Economic Mobility Project of the Pew Charitable Trusts. Similarly, 65 percent born in the bottom fifth stay in the bottom two-fifths.
By emphasizing the influence of family background, the studies not only challenge American identity but speak to the debate about inequality. While liberals often complain that the United States has unusually large income gaps, many conservatives have argued that the system is fair because mobility is especially high, too: everyone can climb the ladder. Now the evidence suggests that America is not only less equal, but also less mobile.
America has become less equal in the last six years, so as harrowing as those figures above are, the current situation is likely worse. We live in a caste society completely unmoored from reality—calling ourselves capitalists while we subsidize the richest among us in a system resembling corporate socialism—all the while placing the burden on the citizenry to “carve their own path” (while relying on said corporate oligarchs to provide for all their medical bills). Whichever city gets Amazon’s HQ2 will have legitimate reasons to celebrate. Jobs are jobs and Amazon is bringing a significant amount with them, but the overall trend that we are giving in to is incredibly bad for us long-term. This is the story of the only America that millennials know: serving our investor class’s short-term gains at the expense of our long-term health. This is why most of us don’t believe in capitalism anymore. The American version of it is simply oligarchy with better branding.
Jacob Weindling is a staff writer for Paste politics. Follow him on Twitter at @Jakeweindling.