The DC Tech Scene is all a tizzy over the possibility that Amazon will open its second headquarters, or what all the cool kids are calling Amazon HQ2 somewhere in the DMV.
For those of you who are living in a hefty bag, let me catch you up. In September 2017, Amazon announced its intention to spend $5 billion in construction costs for a second headquarters that would employ 50,000 people somewhere in North America. They invited economic development authorities and local governments to join a beauty contest for the honor of hosting Amazon HQ2.
On January 19th, Amazon made its decision. Based on all the tax incentives and other corporate welfare offerings from all the bidding parties, Amazon narrowed their choices to 20 finalists from 17 major metropolitan areas.
The DC region has three bites at the 20-bit apple. Washington DC, Montgomery County, and Northern Virginia. And all of a sudden, the press went a flutter! Well, not the Journalists, let me rephrase that. The link baiters at DCInno and Technial.ly.dc, better known as (Technically, not Technically) all have Amazon fever.
Well, folks, I’m not all aflutter. Not only do I think we don’t have much chance of landing Amazon HQ2, but I also think landing HQ2 would be a disaster for our region. Why?
Why We Don’t Want Amazon HQ2 in the DMV
- Talent – Technical Talent, Consumer Marketing Talent, and just great talent in general are scarce in Washington. Good people are all employed. Have you tried to find a competent engineer lately? It would be easier to get 8 opening night front-row seats to Hamilton and Bruce Springsteen on Broadway (wow, wouldn’t that be cool, a Hamilton/Springsteen mashup).
- Traffic – Has anyone driven on the Beltway lately? We have a traffic problem and 50,000 new jobs will add to that problem.
- WMATA – Metro or Washington Metropolitan Area Transit Authority. I just like to bitch about WMATA so I added them here (me bitching about WMATA).
- Taxes – We regional tax slaves already pay high taxes. Both income and property taxes. What will happen to our government when they give huge tax breaks to Amazon to incentivize them to move to the DMV? We add 50,000 new jobs and get less tax from the business. Let me explain how taxes work for municipalities. Corporations pay taxes and only consume a fraction of what they pay for government services. Humans consume much more government services than they pay in taxes. A strong tax base comprises a good mix of givers, businesses, takers, and humans. Amazon will likely not be a giver based on tax incentives.
- Prices – Do you know how expensive it is to go out in DC? NHL Capital tickets are already way overpriced. Wait until we add more consumers. Hot Dogs at the CapOne Center will be $28. Papa John’s will cost $30, and if they ever serve real pizza instead of the Papa John’s trash, I can’t even imagine what that would cost.
- Distraction – This city has a startup problem. We have a dearth of startups founded in the DMV that have become sustained industry-leading corporations. We need more organically built major employees like CapitalOne and Marriott. Amazon HQ2 is going to suck the talent out of the startup ecosystem doing to DC what Amazon did to Seattle.
Why Amazon Doesn’t Want Amazon HQ2
- Available Talent – Ten of the contestants have higher unemployment rates than DC, including NYC and Newark, NJ, which are in the same major metropolitan area.
- Quality of Life – On this one, DC ranks high. According to USNews, the quality of life in DC places us just Behind Austin and Denver. So Amazon, why don’t you ruin the quality of life in those cities and leave us the F&8k alone?
- Cost of Living – Between Taxes and home prices… it costs ass-loads of moolah to live here. You’re going to have to pay your people the big bugs if you want them to eat.
- Payroll – Any savings they have in tax incentives Amazon is going to lose in Payroll Costs. DC has the highest per capita income of all the contestants. In fact, it’s almost double the first 12.
Bad Transportation systems, bad traffic, high taxes, scarcity of available tech talent, hot in the summer, cold in the winter. Humid lousy weather. The Beltway, WMATA, and no place to get a good Pizza. If I’m Amazon, I’m located in Raleigh, Austin, or Atlanta, and that’s great for the DMV. I don’t want no stinking Amazon HQ2 with their robots and their drone delivery and their hipster employees taking over our Starbucks. Let Amazon ruin someone else’s town.
Summary
Here’s a point that I’m not sure that I made clear enough. Businesses pay more in taxes than they consume in services. For instance, businesses do not go to schools or use parks or libraries.
People consume more services than they pay in taxes. For instance, people go to schools like 13 grades of public school, and any of those people are like me. We do 7th grade over and over again until we get it right.
If a jurisdiction gives a huge tax break to the business in order to get them to relocate, then that formula gets turned on its head. Someone will have to pay for the new schools, which will add a drain on services. That someone is a taxpayer, which means if you are reading this and you live in the DC area, and you’re not Donald Trump, who pays no taxes (no Offense, Mr. President), then you will be paying more in taxes.
And faux news people, please try to stop drooling over this.
Lastly, for those of you who haven’t seen the interview process yet, here’s a video of the municipalities and economic development authorities presenting to Jeff Bezos.
