Amazon's Decision to Ditch NYC HQ Shocks Even Those Who Opposed Deal

Photo Credit: Alex Heath/Cheddar
February 14, 2019
Updated 1mo ago

By Carlo Versano

Amazon's abrupt decision on Thursday to pull out of its plans to build a campus in New York City shocked even the lawmakers who had opposed the deal from the start.

"I never thought they would actually do this," said Jimmy Van Bramer, deputy leader of the New York City Council. "I thought they would fight for the deal they believed in."

Van Bramer told Cheddar in an interview not far from the proposed Long Island City site of the "HQ2" that he believed Amazon and CEO Jeff Bezos' anti-union stance was as much of a factor in the company's decision to pull out as the backlash to the billions in tax breaks the state offered. "We're a union town," he noted.

The decision to suddenly abandon a plan to build an expansive campus in New York City that Amazon said would eventually create 25,000 jobs, most of them highly-skilled and highly-paid, comes after a sustained campaign by a group of state legislators who pilloried Albany over the nearly $3 billion in subsidies that Amazon would receive from New York state as part of the deal.

Gov. Andrew Cuomo, who spearheaded the plan to bring Amazon to Queens, laid the blame for the withdrawal at the feet of Democrats in the state senate.

"The New York State Senate has done tremendous damage. They should be held accountable for this lost economic opportunity," Cuomo said in a statement, in which he noted that Amazon was an important vehicle in the effort to diversify New York City's economy away from real estate and banking.

Rep. Alexandria Ocasio-Cortez, the progressive freshman congresswoman who represents the neighboring district, was one of the leading opponents of the deal. She celebrated Amazon's decision as a victory on Thursday.

"Today was the day a group of dedicated, everyday New Yorkers & their neighbors defeated Amazon's corporate greed, its worker exploitation, and the power of the richest man in the world," Ocasio-Cortez tweeted hours after the decision.

Amazon said in its statement that it does not plan to select another HQ2 location and will instead proceed with its plans for a campus in the Washington, D.C., suburbs that was announced along with the New York outpost.

The reversal marks a major misstep by one of the world's most valuable companies and a reminder of the power of a newly resurgent left flank in politics ー at both the federal and local levels.

It also amounts to an embarrassment for Gov. Cuomo and Mayor Bill de Blasio, a duo who put aside their famous dislike for one another to effusively support the deal to bring Amazon to the Queens waterfront.

When New York Democrats seized control of the state senate in November ー just as Ocasio-Cortez's election elevated her to national prominence ー Amazon's ($AMZN) ambitions immediately faced headwinds. State Senator Michael Gianaris, whose district includes Long Island City, became a forceful opponent of the plan after initially signing a letter of support for it. He blamed the state for negotiating in secret and offering billions worth of incentives while it was struggling to manage crises involving public housing and the city's ailing subway system.

"It's $3 billion in public subsidies for a company that's probably the last one that needs it," Gianaris told Cheddar in December. "It's outrageous."

On Thursday, Gianaris said that the abrupt decision was evidence that Amazon would have been a "bad partner for New York." He called for a national conversation about corporate subsidies.

Rep. Adriano Espaillat (D-N.Y.) was part of that coalition that opposed Amazon at the federal level. He told Cheddar after the deal was canceled on Thursday that Amazon's inability to provide specifics about how it would appease the community's concerns about issues like gentrification and local hiring helped doom the proposal, which he said amounted to "corporate welfare."

De Blasio, who was an adamant supporter, was quick to slam the company for its abrupt decision. "We gave Amazon the opportunity to be a good neighbor and do business in the greatest city in the world. Instead of working with the community, Amazon threw away that opportunity," he said in a statement.

"Most neighborhoods don't want to see their rents triple and quadruple," Espaillat said. "This sets the stage for there to be a more transparent process in the future."

A recent poll found that, despite the opposition from lawmakers like Gianaris, a majority of New Yorkers supported Amazon coming to town by a 20-point margin. Tech:NYC, a non-profit that lobbies on behalf of New York's tech industry, said, "There can be no doubt that bad politics got in the way of good policy here.”

When asked about the loss of 25,000 potential new jobs, councilman Van Bramer said that progressives shouldn't abandon their core values simply as a matter of principle. "I just don't believe in jobs at any and all costs," he said.

"You gotta stick to what you believe in."