In the News: Stacy Mitchell
January 9th, 2018
Media Outlet: The New Republic
David Dayen, a prominent anti-monopoly thinker and reporter, has taken on a number of different industries in his reporting. In this piece for The New Republic, Dayen delves into Amazon’s history of public subsidies to build its prominent infrastructure network.
As our comprehensive Amazon’s Stranglehold report methodically laid out, Amazon is continuing a strategy of of seeping its tentacles into every nook and cranny of our economy.
Here’s the section of Dayen’s story where our research plays a role:
The largesse bestowed on Amazon in Ohio is incredible. A deal for three Amazon data centers netted Amazon a 15-year exemption on property and sales taxes worth $77 million, a $4 million offset to payroll costs, and $1.4 million in cash, and only committed the company to 1,000 full-time jobs. A sorting facility in Twinsburg, Ohio, would only have ten full-time jobs, with the rest part-time or seasonal. No matter: Twinsburg gave a partial property tax exemption worth $600,000. Another warehouse opening in Euclid, outside of Cleveland, has yet to yield details on what the state kicked in.
Most of these deals go through a privatized economic development agency called JobsOhio, which doesn’t require as much transparency as a public agency about what taxpayers are getting for their money. JobsOhio continues to defend the Amazon deals as good for the state, claiming that full-time warehouse workers receive 30 percent higher compensation than the national retail worker average. That figure doesn’t bear out compared to independent data reports from the Bureau of Labor Statistics, which puts Amazon wages 15 percent below the average wage in 11 metro areas, at only $11.96 an hour, a number roughly equivalent to the average retail wage.
Amazon CEO Jeff Bezos has a net worth of about $100 billion. Take that down to $99.5 billion and nobody working at any Amazon facility in America would need assistance to eat. But this is as much a problem with state and local governments who feel the need to give a fantastically wealthy corporation incentives to build facilities that are critical to its business model.