The Fallout Continues -- Amazon-NYC Deal Gone Awry -- February 15, 2019

Updates

February 20, 2019: the fallout continues.

February 16, 2019: when our grandchildren ask a question, I tell them to google it or follow the money. In the case of the Amazon-NYC story googling it won't help, at least not yet. Following the money won't help in this case either because Amazon/Jeff Bezos had tons of that. To some degree it's related to money but there's an easier explanation: unions.

Hindsight is 20-20 vision and in this case, the movers and shakers knew that if Amazon did not allow the unions to build HQ2 in Long Island City, it wasn't going to happen. The Verge almost had the story several months ago ... TheVergecamethisclose.

Here's how it played out. Early on, everyone knew that Bezos would not let the unions control the project (we'll get back to the "why" later -- money was a secondary issue -- as mentioned earlier, Jeff Bezos/Amazon has tons of money). So, we start with that one simple thesis: Everyone knew that Bezos would not let the unions control his HQ2-NYC project. [By the way, this was Bezos' Achilles heel: he despised Trump so much he failed to have his people talk to Trump's people on how to get a NYC project done, but that's another story.]

So, the unions aren't going to let Amazon build in NYC if they don't get their way. Senator Schumer and Governor Cuomo knew that and The Verge camethisclose to pointing that out. They either missed it or were afraid of publishing it, thinking they would have egg on their face if they were wrong.

When it became clear that Amazon/Jeff Bezos would not "play ball," the NY unions stopped the project. It was a multi-pronged attacked: in the state senate, a democratic senator led the charge. In Long Island, the unions co-opted Occasional-Cortex, convincing her that the state was actually going to give $3 billion to Amaazon instead of using that money for other state projects. [I have trouble believing that O-C is that stupid, but that's another story for another time.]

There was a term that kept popping up -- "friendly neighbors" -- and that was code for hiring unions and playing by NY rules and NY politics.

But the interesting thing is this: money was a sidebar issue for Bezos. He had tons of it. This is what concerned Bezos: working with the unions and the state, he saw that the project would never be completed. This project would go on for years and year and years because he had deep pockets and the unions saw this as life-time employment.

Exhibit A: the "Big Dig" in Boston, MA.

Bezos: welcome to NY politics. 

Bezos saw that he would be "buying off" every politician and every union official to get this project done. The "friendly neighbors" euphemism explains it all.

And, oh by the way, the whole debacle reveals Bezos' Achilles heel. More on that later.

Later, 12:11 p.m. Central Time: I agree with the writer at The WSJ. For those who live in the flyover states, Amazon's decision to not build in New York is a huge win. It is also a huge win for tech centers outside New York: North Carolina; Texas; Washington (state); California; and, maybe Virginia.

In its announcement, the company said it would continue to invest in its 17 other North American corporate and tech hubs, as well as its forthcoming expansions in Northern Virginia and Nashville. Setting politics and any immediate fallout aside, the decision could significantly benefit America’s tech economy in the long run, say experts in regional economic development.

The answer to overcrowding in Seattle and Silicon Valley wasn’t to build yet another tech headquarters in an already crowded city like New York, but to spread out. The best situation of all, they argue, would be if Amazon were to distribute its intended 25,000 New York jobs across these other sites, where it already employs more than 20,000 people.

Original Post

A comment from one of the articles:

So, apparently there is a lot of construction going on in New York but job creation? I have no idea whether the comment above is accurate. Someone can fact-check it if interested. I am not.

Miscellaneous:

The good news is that democracy is working. It looks like 50% of the folks didn't like Amazon coming to the NYC area for one reason or another and 50% of the folks wanted to see Amazon. So, in the big scheme of things, it's a wash.

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Tree-Clearing

What a massive solar farm does to a forest ... I pretty much thought this was "outlawed" in the US these days. Isn't this called clearcutting or something to that effect, something that timber companies were banned from doing years ago?

 And it looks like this is just the beginning: