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Amazon Abandons Plans for NYC Headquarters

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Amazon logo with the "smile" portion of it reversed to look like a frownAmazon broke up with NYC on Valentine’s Day. For some, the breakup was mutual. For others, there will be heartbreak for years to come. Amazon chose New York City, specifically Long Island City in Queens, as the site for one of two new headquarters. Amazon’s infamous HQ2 search had come to a close with the company splitting their 50,000 new jobs between New York and Virginia.

However, opposition to the new headquarters was fierce. Activists were extremely unhappy that Amazon was getting $3 billion in subsidies from the state and city. They were unhappy that the deal happened behind closed doors, and were worried that Amazon’s presence would cause rapid gentrification of an impoverished area of the city.

Amazon couldn’t take the heat.

Amazon hasn’t fully fleshed out their plans for those 25,000 jobs. They’ll likely find their way to other Amazon headquarters throughout the U.S. The only certainty is that they won’t be in LIC, Queens. For some, the news is devastating. Though even opponents of the deal are reluctant to celebrate too enthusiastically. What went wrong in NYC and what can we learn from it?

Why New Yorkers Didn’t Want Amazon

https://twitter.com/NYCSpeakerCoJo/status/1096105149225975808

MTA Woes

Our city has a crumbling infrastructure. Early this winter, a bit of snow made my normal 30 minute commute take a whopping hour and a half. Though my commute has more often been stretched out by “signal problems” or delays in stations that lead to congestion. The L line still hasn’t been repaired after damage from Hurricane Sandy. Trains are slow, ridership is high, and, despite fair hikes, the trains are slower now than they were in the 50’s.

While Cuomo couldn’t find the money to repair our crumbling trains, he could find $1.7 billion in the state budget in subsidies for Amazon. Mayor de Blasio managed to find $1.3 billion he could cut from the city budget. As New Yorkers languish underground, our leaders threw our money elsewhere. Amazon could have promised to help with infrastructure improvements. They did not.

Those infrastructure improvements would have come in handy for the thousands of people Amazon would have displaced. LIC is home to the largest public housing development in the United States, where low income families can find subsidized housing to help them survive. These people wouldn’t have been able to afford having their neighborhoods become more expensive, and would have had nowhere to go. If that sounds implausible, one only has to look at San Francisco and Seattle, two places where tech caused a boom in gentrification and a spike in homelessness.

Unions

Amazon has a long history of workers’ rights violations. They’re anti-union, and New York is a city famous for its strong unions. Our cultures just weren’t compatible. We wanted to ensure that Amazon’s new employees, from its janitors to its software engineers, would be treated fairly. Amazon, again, was unwilling to make those promises.

Nasty Secrets

Finally, the deals Amazon made with Governor Cuomo and Mayor de Blasio were behind closed doors. Amazon insisted on secretive negotiations. As a result, even the local politicians in Long Island City and Queens were excluded from negotiations. These politicians, who have a tight relationship with their constituents and their needs were ignored. As a result, Amazon, Cuomo, and de Blasio ignored the needs of New Yorkers.

Are We Losing Something of Value?

Full disclosure, I would have personally benefited a great deal from Amazon’s HQ2 being in my backyard. I live in Brooklyn, which means I’m impacted by our terrible MTA heavily. I walk more on my commute than I’m on the train, on a good day, because transit is sparse in the boroughs. Getting to Queens can take over an hour. I lived just north of Long Island city when I first came to New York, in Astoria. My favorite brunch spot is still up there. But I can never visit, because, honestly, I just can’t take the hour and 20 minutes out of my day for that commute.

The BQX, a streetcar path proposed by de Blasio, would have solved this problem. It would have been vital for Amazon’s new headquarters as a way to bring in employees from Brooklyn and Queens. Without Amazon, support for the expensive project may have dried up.

Furthermore, I’m a software engineer. Amazon’s promised median wages were significantly higher than my own. If Amazon came here, they would have increased competition among tech companies. My own company would have had to increase my wages to keep me from going to Amazon, Google, Facebook, Apple, or any of the other companies in NYC willing to play ball. That leap in pay is gone now too.

But What About the Rest of NYC?

You don’t want to hear the bemoaning of a software engineer though. We’re famously the cause for gentrification in cities as we move to where the jobs are, pushing longtime residents out of their homes. Yes, my already higher-than-average wages would have gone up. And I, like every New Yorker, would have loved improvements to mass transit. The BQX, improvements to the Long Island Railroad, Amtrak, and NJ Transit would have benefited everyone who calls NYC their home.

Amazon’s presence would have pulled in more tech sector jobs as well. More software-focused companies would have made NYC their home, meaning I wouldn’t have to consider a large move to consider new employment. Startups would have moved here. Large companies like Apple would have increased the sizes of their headquarters here. That wouldn’t just bring in new tech jobs, but more support jobs as well. These new buildings create booms in construction and service industry jobs, as well as maintenance jobs. Techies aren’t the only ones who benefit.

Small Business Impact

“It’s definitely heartbreaking. There’ll [sic] be less foot traffic, and we depend on foot traffic. We depend on, obviously, the locals, but we depend on the construction workers, the business workers, so we depend on all that.”

– Steve Logiudice, Centro Pizza Bar and Italian Kitchen owner

We have to look at the existing jobs Amazon would have helped as well. Take Steve Logiudice, owner of the Centro Pizza Bar and Italian Kitchen in Long Island City. He was looking forward to the growth his business would see with all these new people in his neighborhood. Folk’s need food, no matter what their job is, and everyone likes a good NYC slice.

Hairdressers, laundromats, thrift stores, restaurants, and other small business owners were all looking forward to this deal. It would have injected life into their struggling businesses. Some may have already planned expansions, using Amazon’s promise as justification for loans on larger ovens, new chairs, or other business expenses. Now they’re out that money. These are struggling New Yorkers who would have been able to benefit from an influx of business. Now they’ll have to try to find new ways to improve their lives and the lives of their families.

Could This Have Gone Better?

“Today’s behavior by Amazon shows why they would have been a bad partner for New York in any event.”

– New York State Sen. Michael Gianaris

Amazon chose to break up instead of trying couple’s counseling. The fact that a small amount of opposition from local politicians was enough for them to pack their bags and run shows they never would have been a strong business partner for the city. They would have reneged on already murky promises as quickly as construction began.

A better relationship is one that isn’t done in secret. If you have nothing to hide, like shady helipads purchased by the city, then you don’t mind involving a city’s citizens and local politicians. Instead, Amazon insisted on hiding their negotiations. As a result, they cut out the people who would have felt the impact—good or bad—of their presence the most.

Google

A shimmering biulding with glass, bushes, trees, biles, and concrete. A place at odds with the neighborhood, but beautiful none the less.

A rendering of Google’s upcoming Hudson Square Campus via Cookfox Architects

Google’s making a huge investment of over $1 billion in New York City. They’re also moving 14,000 jobs to the city over the next few years. This hasn’t been as big of a story because, unlike Amazon, Google hasn’t taken large subsidizes that look suspiciously like bribes. They’ve been transparent. They’re also moving a headquarters to an area of Manhatan already famous for its expensive real estate, so they likely won’t displace people from their homes.However, their presence will also be a boon for local businesses in the West Village, a place with history and charm.

Amazon could have done much better. They could have done more to ensure that people wouldn’t lose their homes. They could have made concrete promises in writing to improve education, infrastructure, and housing in Queens. Instead, they only promised us jobs, and couldn’t even promise that they’d hire New Yorkers for those jobs or bring most of them in from out of state. Amazon could learn a thing or two from every company that doesn’t try to bully their way into a city, but grows organically with us.

What Does this Mean?

Screenshot from Amazon anti-union video, showing "Living Wage," "Grievance," "Contract," and "Representation" coming out of a box labeled "Union Words."

Amazon warns of “union words” in this leaked instructional video.

Amazon and our leaders learned something very important this week. Protests can make a difference. Closed door deals that cut out the public and local politicians will never sit well with the public or local politicians. Small government matters, and people’s opinions matter, especially with something as delicate as our neighborhoods. You can’t plan such a drastic change to our homes without talking to us. Amazon cut out all public negotiation and reaped huge rewards. Now they’ve found they won’t get to keep those prizes.

Public perception is important. Amazon has tarnished its own reputation by mistreating workers and backroom dealing. Now they’ve lost a home and have to recoup the expenses of their fruitless search. They’ve learned their aggression has consequences, and people aren’t as willing to bow down to their demands anymore.

We can add this to a long list of failings for de Blasio and Cuomo. The two have allowed the infrastructure that makes up NYC’s lifeblood crumble. Now, but cutting out the public and local politicians from an important deal, they killed negotiations, took part in shady deals, and doomed what could have been a fantastic relationship. They’ve also lost public trust. Amazon coming to NYC could have been a great thing. Instead, it became a one sided deal that promised investment and jobs in exchange for people’s homes.

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