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Details of cities’ Amazon HQ2 bids should be public

Oct. 25 2017 —

The City of Calgary’s marketing team hit the streets of Seattle on the morning of Oct. 19 — the deadline for cities to bid on becoming home to the second head-quarters of tech giant Amazon. Winning will grant one city 50,000 jobs and over $5 million in capital investment. Calgary’s on-the-ground campaign included graffiti joking that the city would change its name — to Calmazon, or perhaps Amagary — and a 30-metre-long banner purporting that the city would “fight a bear” for the company.

Though gimmicky, these stunts, coordinated by Calgary Economic Development, are tame compared to those put on by some of the other 237 cities vying for the corporate offices. New York City monuments lit up “Amazon orange,” while Stonecrest, a suburb of Atlanta, Georgia, offered to literally change its name to Amazon and appoint the company’s CEO as its mayor.

As bizarre and pathetic as some cities’ attempts to sway Amazon’s choice are, they only account for the public aspect of bidding for Amazon’s HQ2. In the company’s bid outline, they specify a “business-friendly environment” and “incentive programs” like tax breaks as preferences that will drive their decision. And since cities’ bids are confidential, with some municipalities even signing non-disclosure agreements with Amazon, it’s impossible to know just what incentives they’re offering.

The details that have leaked show a trend towards corporate welfare. The state of California may give $1 billion in tax breaks for Amazon, while New Jersey has proposed a staggering $7 billion. These offers are being made to a company that’s already worth over $500 billion — a number that will only grow.

While Calgary can’t legally offer property-tax incentives to Amazon due to provincial laws, it’s unknown what incentives the city has put forward. Still, Amazon could bring thousands of jobs to a city still hindered by the recent economic downturn. Calgary has a staggering amount of vacant office space downtown, leading to a deficit in property taxes from would-be tenants and a difficult budget to balance. Plus, the city fits many of Amazon’s criteria well, only missing a direct flight to Washington D.C., which WestJet says is a possibility.

Governments should never conceal how public money is spent, but Amazon is forcing them to. Though Calgary absolutely needs to at least try to attract Amazon, concealing the bid should not have been an option.

A winning bid also doesn’t end at its submission. Once a company like Amazon is in town, they’ve got a lot of leverage over the city in terms of future benefits. In fact, many argued at the time of Amazon’s HQ2 announcement that it was a way to gain more from the home of their first headquarters, with Seattle officials quickly responding to the announcement that they were planning to “begin conversations with Amazon around their needs.” We don’t have to look far from home for an example of this, with the Calgary Flames using threats to leave town as a negotiating technique for a team-friendly arena deal.

It’s also worth noting that Amazon isn’t without their share of controversies, ranging from squashing efforts by staff to unionize to appalling working conditions that have landed the company in hot water time and time again.

Despite the general shadiness of governments making private bids to a half-trillion dollar organization, cities don’t have much choice about participating. The benefits that companies like Amazon can bring to a city are huge and for places like Calgary that are facing serious economic downturns, saying no to that kind of possibility would be downright irresponsible. But it’s important to remember that the public groveling of guerrilla or social media marketing campaigns is little more than a front for the confidential offers Calgary and others are making to a massive corporation.

Jason Herring, Gauntlet editorial board

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