Well Amazon’s plan to build a second headquarters in New York City (and in Crystal City, VA) was never of course a book story. The fact that they claimed there would be 25,000 jobs paying on average $150,000 a  year proves that. I wonder if there are that many people in the whole of book publishing making such money. I posted three months ago welcoming the decision to come to New York.

There was a lot of adverse reaction in New York to the fact that the deal had been negotiated in secret (as if negotiations like this can be conducted in public) and that a company as rich as Amazon should be given such large tax breaks. But no special deals were cut: all the tax incentives granted are laid out in state law, and are available to any company which wants to try for them and has an argument to support their case. It’s no doubt true that Amazon doesn’t really need the money, but the fact of the matter is that all cities and states play this game and if we hadn’t done it we would not even have been considered. Sure NYC’s a great place: but Amazon was trolling for tax breaks, and in order to play you needed to pay. I trust the calculations made by our governor and mayor were correct and that we’d have made much more back from taxes and spending over the years than it’d cost.

Amazon have now suddenly cancelled the deal overnight: the mayor of NYC, Bill de Blasio, tells us on the radio this morning that just the day before the cancellation he was on the phone negotiating with a senior Amazon person the details of infrastructure spending the company was committed to making. Now of course a big company (a small company too) has an absolute right to change their corporate mind, but surely at the end of a year-long, publicly self-promoted campaign to provoke cities around the country to knock themselves out attracting the great and good Amazon, the company owed everyone a bit of notice and debate before just walking away from the deal. They can’t really have been surprised at the sort of objections that the original announcement provoked. People in Long Island City were bound to be worried that their rents would go up, and to suspect that they’d not be getting too many of those $100,000+ jobs. Their elected representatives could be relied on to voice these concerns, and while none of us has the inside story, the hassle cannot possibly have seemed too injurious to a company notoriously customer-oriented, and relentless in the pursuit of its objectives.

Is it possibly the case that Amazon’s anti-union position was a major factor? The unions were in negotiation with them and seemed to think they were making progress just a day before the pull-out.

I think Amazon’s sudden withdrawal from their New York deal teaches us two things. Firstly I think it suggests that Amazon probably doesn’t really need a second headquarters. They have said that they won’t be looking to replace the Long Island City establishment in any of the other cities that submitted bids. So it looks like they may have decided they didn’t really need to spend the money building up a new large establishment: they can just cope with things by beefing up staffing in this or that of their current offices around the country.

The second thing we learn relates to the complacency of politicians. They tend to assume that what looks to them to be self-evidently a good thing, will therefore look to be a good thing to the entire population. But the benefits of any deal need to be spelled out. Just because you, who spend your life immersed in politics, know this is the right thing to do, you cannot assume that all the people find it equally obvious. We saw this problem potentially take down a whole country when Britain’s elites blithely assumed that the economic and historical benefits of membership in the EU, which may indeed be obvious to anyone who has thought about the issue (and who remembers World War II) were obvious to people who’d never really thought about it because all their time is spent making a living and getting by, or watching television, responding to their friends’ posts on Instagram, or even God knows reading books. Just because you’re a politician doesn’t mean everyone is. Politicians surely know that emotion plays a larger role in people’s decision-making than reason. Yet Governor Cuomo and Mayor de Blasio spent more time celebrating a big win, than in explaining the reasons why such a win was important.

Oh well, we’ll get by without an Amazon HQ.