
Amazon’s HQ2 Spectacle Should Be Illegal - tysone
https://www.theatlantic.com/article/575539/
======
cepth
Some back of the envelope math. Amazon is receiving $1.525 billion in
incentives from NY state and city, conditional on creating 25,000 jobs
([https://www.nytimes.com/2018/11/13/nyregion/amazon-long-
isla...](https://www.nytimes.com/2018/11/13/nyregion/amazon-long-island-
city.html)). That's $61,000 per job, paid out over 10 years.

From a purely fiscal point of view, do we expect these jobs to generate $6100
a year in additional tax revenue for the state and city? That would be the
"breakeven point". This could come in the form of additional state and city
income taxes, consumption that is taxed, etc. Payscale says the average Amazon
software engineer makes around $109k
([https://www.payscale.com/research/US/Employer=Amazon.com_Inc...](https://www.payscale.com/research/US/Employer=Amazon.com_Inc/Salary)).

If we believed that Amazon is actually creating 25,000 NEW jobs, as well as
jobs that otherwise would not exist, it seems pretty reasonable to say that
the state and city come out ahead net-net. However, I have trouble believing
that the "knowledge workers" who will join Amazon would otherwise have been
unemployed and underpaid. Factor in the various negative externalities of
increased commercial and residential rents for others, potential
traffic/congestion issues etc., and it seems like Amazon got a sweetheart
deal.

~~~
WhompingWindows
Thank you for running the numbers. How can we price in the wasted time/effort
of the dozens of other cities who put in bids? How about the many millions or
perhaps billions of dollars of free advertising and air-time taken up by this
charade? I am neutral on Amazon specifically but surely we should not allow
big companies to run roughshod all over our desperate cities? Look at Foxconn
and Scott Walker for another example of companies harming and exploiting a
metropolis/state. It really rubs me the wrong way.

~~~
jackconnor
I didn't see Bezos pointing a gun at anyone's head to force their city to bid.
This is 100% on them, if they thought it would be a waste of money, they
could've opted to spend nothing. "Running roughshod all over our desperate
cities", while a fun turn of phrase, completely and utterly misrepresents what
happened here. Don't blame Amazon for the actions of local governments, though
I know it's the easy/lazy way of approaching the problem.

~~~
scott_s
That's rather the point: when all actors are behaving rationally, yet the
outcome is not something that is good for society, we need to change the rules
to change behavior.

~~~
tedunangst
One might make the case that the cities were not acting rationally.

~~~
throwaway2048
Its rational to not entertain amazon's offer only if you know for certain
nobody else will either. The first one to defect gets everything.

[https://en.wikipedia.org/wiki/Superrationality](https://en.wikipedia.org/wiki/Superrationality)

~~~
tedunangst
This is like paying Tom sawyer to paint the fence. It's okay to let the other
kids outbid you.

~~~
clarky07
I'm not sure I'd agree with that. For instance, I think the Nashville deal is
fantastic for my city/state. we are getting 20% of the jobs (5k vs 25k) for
"only" about 100 million compared to several billion from NY and VA. It will
easily make that back in benefits to the local economy and increased tax
revenues.

------
cremp
What Amazon did shouldn't be illegal; what the cities did to try to get Amazon
to them should be.

Rather than punish Amazon, punish the public servants who thought a large tax
break for years, or real estate deals, would really be big enough to draw the
company in.

What Amazon did was playing the field; why not get a bonus for letting others
compete; rather than taking nothing because it was already decided?

~~~
snidane
Correct. But you don't want to eliminate municipal competition either.

The problem here is of representation. Ie. the city residents could not agree
with their tax money being spent on this.

This is an example where a direct democracy shines, basically any decision
which lasts longer than a current politicians' mandate should be voted
directly by citizens to align the incentives. Any decisions with effect
roughly contained within a voting period could be delegated to 'managers', ie.
politicians voted for administration of public things.

The problem today in countries without direct democracy for longer term issues
is that they elect these 'managers' to decide on matters vastly exceeding
their mandate.

~~~
JumpCrisscross
> _city residents could not agree with their tax money being spent on this_

New York City taxpayer here. Fine with it. 25,000 high-income jobs, even if
after 10 years, makes the new engineering campus on Roosevelt Island instantly
more productive. Those jobs will pay taxes, spend money in the local economy,
and drive demand for East River infrastructure improvements.

I _do_ believe that these sorts of subsidies should be required to be put to a
popular vote. Wouldn't be a bad state constitutional amendment, actually...

------
kodablah
Completely disagree that it's a problem or that it needs a solution and
completely disagree it should be solved at the national level. If communities
want to mortgage certain parts of their cities, that is their prerogative.
It's growing tiresome reading all of this non-representative nonsense about
wanting to change how other peoples' communities spend their money. This is no
different than saying every state should tax income or tax businesses a
certain way. The same reasons in favor apply.

The real problem with articles like these is that they say something is a
problem and just expect you to magically believe it is. They throw out large
numbers given in tax breaks and just say "poof, this is a problem" as though
the readers automatically assume paying less in taxes is a problem. There are
many people that believe that in many cases money is better spent elsewhere
and the taxes are too high in the first place. There are many others that
believe it is ideal to give to the job creators. And many others believe
companies providing disproportionate benefits deserve disproportionate
concessions. Whether you believe this or not is less important than your
ability to understand why others do. The absence of that understanding, and
similar dissonance across other issues, aptly explains our current political
spectrum. But at least, for the time being, those that disagree with this
article can still have these kinds of financial choices at the community
level.

~~~
ptero
I mostly agree with your sentiment (as I understand it), but I think your
approach is overly simplistic. Specifically, this:

> If communities want to mortgage certain parts of their cities, that is their
> prerogative.

That (usually) works OK for small communities with residents paying for their
decision, for example a condo complex community debating whether to build a
pool or a playground. For HQ2-scale projects the decision to mortgage parts of
a city is done by bureaucrats that have no long-term financial stake in the
result: they are here today, gone tomorrow. Letting them decide such things
(often in secrecy) is way too cavalier. My 2c.

~~~
kodablah
> is done by bureaucrats that have no long-term financial stake in the result

This is true in many cases (and not in others, such as sports team funding
which are often voted on). If we want to have a more nuanced discussion about
transparency and direct representation on financial decisions of a certain
size (a hot button issue concerning being able to vote on property taxes in my
state), that would be reasonable. But it's hard to have these kinds of
discussions with pro-tax/anti-company-concession advocates shouting so loudly.

In the meantime, on the scale of politicians with less representation to their
constituency, using a federal level mallet is the exact opposite of
representative. The city I live in gave large tax breaks and land to companies
moving in, seemingly unfairly so compared to existing local companies, but if
most of us didn't like the outcome (which most of us do and applaud their
appetite for growth/prosperity) we'd have no problem running the mayor and
councilmen out of town.

~~~
metalliqaz
And with the mayor run out of town, you'd still be left holding the bill.

~~~
kodablah
Of course, as I might be with a new road project or any other commitment. As
is Amazon even if their CEO is fired. I suppose I don't understand the
relevance of pointing out the obvious here. If we're asserting fraud, that is
a different discussion, otherwise we live with decisions by decision makers,
some beyond their term.

------
asr
It's worth noting that in Europe things like this _are_ illegal:
[http://ec.europa.eu/competition/state_aid/overview/index_en....](http://ec.europa.eu/competition/state_aid/overview/index_en.html).

So the idea that it would just be too hard to make this illegal (which I see
in at least a few comments) is wrong. We could have laws at the federal level
that prevent it. (I'm sure there would be constitutional challenges but that's
a separate--and in my view surmountable--issue.)

~~~
gnopgnip
Is what happened with Amazon really fundamentally different than the state
building a hospital, staffed by private practice doctors, or a university?

------
protomyth
Its hard to make ego illegal. Politicians pull this stunt a lot to "make their
city better", but it really comes down to a desire to be seen as a builder
even if the cost / benefit just isn't there. Look at all of the rhetoric
politicians use when giving speeches about a new stadium. If you get to sit in
a box seat and see thousands of fans, its hard not to see it as a success.

The really sucky part is that a lot of people really want the X but don't
understand how much their politicians gave up for X. Its often murky and
people aren't experts in finance or city budgets. But that new stadium / HQ
really looks cool right?

~~~
sonnyblarney
"Its hard to make ego illegal."

It's very easy to make subsidizing individual companies illegal.

~~~
protomyth
Given all the tools that are at a politicians disposal, it actually is rather
hard to stop all the paths a city can use to participate in this kind of thing
since a lot of it is based on what they do everyday.

~~~
sonnyblarney
I'm not sure I agree.

If it's made illegal to subsidize individual corporate interests through tax
incentives, direct subsidies, what else can be done?

Zoning? That to me is actually a legit thing. If Amazon wants to build 5
buildings next to downtown, on land that isn't currently zoned for that - it
makes perfect sense to consider that. For any company frankly. It's the cities
job to accomodate various interest with zoning.

So what else is at a politicians disposal?

No much.

Maybe guaranteed contracts ... but even then, that's not such a bad thing so
long as the company is getting value. Moreover, I don't think cities are big
users of any of their local companies things.

Bombardier always threatens to leave Montreal as they try to get giveaways
elsewhere ... it's not like Phoenix Arizona, which was going to give
Bombardier a big chunk of cash to open a factory there is going be buying jets
or snowmobiles.

So I think that 'making it illegal' would definitely quash most of this
activity.

And FYI if politicos try to bend the rules, they open themselves up to
lawsuits.

So I think it's possible.

~~~
protomyth
_If it 's made illegal to subsidize individual corporate interests through tax
incentives, direct subsidies, what else can be done?_

Its really not that hard to make the incentive for all companies but write it
specifically so it only fits one. Ask any HR Director writing job descriptions
that they intend to hire an H1B for. We have plenty of laws that are rather
easy to get around. It really would take some serious changes in how city
councils are allowed to operate.

And who is going to limit them? Cities are not self limiting. Maybe a petition
in states like California and North Dakota, but certainly not the state
government since those politicians get to sit in the box seat too.

~~~
sonnyblarney
I don't understand your argument.

Municipalities have no influence over H1s. But even then, providing choice
access to H1 programs is not the problem here. That might even be beneficial,
moreover, that's a national program.

"And who is going to limit them?" "Cities are not self limiting."

??? The law. If it's illegal for a city or state to give money to private
companies that there's not much need for populist oversight, because it's
against the law.

You do realize most government officials generally follow the law right?

~~~
protomyth
_Municipalities have no influence over H1s. But even then, providing choice
access to H1 programs is not the problem here. That might even be beneficial,
moreover, that 's a national program._

Its an example that shows how a law that is meant to limit an actor (in this
case a company) that does not truly limit that actor.

 _??? The law. If it 's illegal for a city or state to give money to private
companies that there's not much need for populist oversight, because it's
against the law._

Is the city going to pass that law? Is the state? No. Neither will limit their
own power. Maybe a citizen passed initiative would work.

 _You do realize most government officials generally follow the law right?_

Someone has to pass that law.

~~~
sonnyblarney
Your argument was: "Given all the tools that are at a politicians disposal, it
actually is rather hard to stop all the paths a city can use to participate in
this kind of thing since a lot of it is based on what they do everyday."

My agument is simply that a law could be passed, which would mostly solve the
problem.

Now you're saying 'well a law has to be passed'.

Yes. Of course. It has to be passed.

But if a law is passed, and it certainly could ... then there's little
politicians could do to get around it.

Your argument about 'politicians can do a lot' \- of course they can if they
are free to do as they please. Nobody is debating that 'politicians can give
subsidies if they want'.

"It's hard to make ego illegal"

Again - no it's not hard at all.

Just literally make it illegal to subsidize, and then it'll stop.

Obviously that's no small feat.

~~~
protomyth
Look, I saying that there is no way a law is going to get passed and there is
a very high likelihood that such a law would be ineffective due to the basic
nature of the powers a city needs to govern itself. I gave an example of
another such law (H1B) that is worked around when its scope is even stricter
than the governing of a city and the powers needed for such.

 _It 's very easy to make subsidizing individual companies illegal._ was your
original statement. Now we have _Just literally make it illegal to subsidize,
and then it 'll stop._ _Obviously that 's no small feat._

The crafting of such a law without destroying the governance of a city is an
amazingly hard problem to which I have not seen one city, state, or petition
that has attempted it.

~~~
sonnyblarney
"and there is a very high likelihood that such a law would be ineffective due
to the basic nature of the powers a city needs to govern itself"

I think this is not true.

You haven't made any reasonable arguments in this regard - i.e. haven't
demonstrated how a) the law could not be enforced or b) how the city needs to
subsidize in order to function

A law banning direct corporate subsidies would work really well.

"The crafting of such a law without destroying the governance of a city"

I totally disagree. Cities generally do not directly subsidize businesses.

As for getting the law passed, yes, I'm with you there. Very hard. It couldn't
be done at a state level because states compete, so it'd have to be done at
the national level.

------
tanilama
> Why the hell are U.S. cities spending tens of billions of dollars to steal
> jobs from one another in the first place?

First, US, at this point doesn't have a shortage of jobs, it has a shortage of
good jobs. In case of Amazon, it creates good jobs, then it is a demand and
supply problem.

~~~
romed
I've interviewed about 100 programmers who just passed their 366th day at
Amazon and are looking to get the hell out. Further down the ladder their
people are pissing in bottles and collecting food stamps. The only person at
Amazon with "a good job" is Bezos himself.

~~~
zanny
For most employers satisfied, happy, and content workers are just
underexploited. If they aren't miserable you aren't getting your monies worth.

Its a legitimate mindset way too much of the business world in the US believes
despite the psychological evidence that content and happy employees are more
productive.

The consequence of such a widely held backwards rewards structure is that in
almost any job there is someone else doing something even worse that is more
than willing to take your spot to reduce their misery by a fraction.

------
twblalock
The author wants to prevent a race to the bottom on taxes. A race to the
bottom would be bad if taxes are fair or already too low. But if taxes were
too high, a race to the bottom (or just the threat of one) would be a good
thing, as it could keep unreasonable tax rates in check.

To put it differently: if companies and individual workers were not able to
shop around for the tax regimes they prefer, what would prevent cities and
states from raising taxes to unreasonably high levels? Taxes are kept in check
by the threat of companies and high-earning taxpayers moving somewhere else.

I would rather live world where taxation is subject to a race to the bottom
than in a world where nothing prevents unfairly high tax rates. The latter is
definitely worse.

~~~
sparky_z
I'm fine with jurisdictions competing on taxes, but you have to lower them for
everyone. No special tax breaks for individual companies. Provide a level
playing field for everyone.

------
jsgo
Ads, assuming ads based on the status that was popping up in the bottom left,
constantly refreshing should be illegal. I got to the point of trying to hover
over the link about the people not having standing to sue Ohio to see the URL
and couldn't read it because yet another thing was being pulled down after 5
or so minutes on the page. I sat there for a little bit to see how long it'd
take to trigger again and the answer is "not long."

As for the topic at hand: I'm against the practice. I'm also against the
practice of cities paying for stadiums to lure (or keep) sports teams to their
city. And in a lot of cases, it isn't even owned by the city at that stage,
but rather the team owner. It is nuts. Quite frankly, as great as it is to get
an expansion team to come to your big city for revenue reasons (hopefully.
Marlins don't appear to be doing much for Miami, for example), it is also
advantageous for the team to move to a bigger city as it increases the pool of
potential fans buying tickets, memorabilia, etc. Also, I'd hope that a city I
lived in would not pay for the bid to host the Olympics or similar event (tons
of money goes into building the stadium and hosting, revenue comes in but not
enough to offset, and then you hope you can do something with the building
after but in a lot of cases, you can't. Montreal springing to mind here). Also
reminded of Curt Schilling's company and Rhode Island. Though honestly, I'm
not really all that mad at the companies for engaging in it, so much as cities
for taking part in it.

------
tkdc926
Ok, assume city A offers Amazon one million dollars in tax breaks. If Amazon
moves to city A, city A will not receive one million tax dollars from Amazon.
If instead Amazon turns down city A and moves to city B, then city A will
STILL not receive one million tax dollars from Amazon. City A will NEVER
receive one million tax dollars from Amazon, no matter what Amazon decides to
do. What am I missing?

~~~
sparky_z
It's not a net loss to the local government. It's a loss to Amazon's
competitors that don't get those tax breaks. That local government is picking
winners rather than provide a level playing field, and enriching themselves in
the process. It's essentially bribery for favors but payed with tax revenue
instead of under-the-table cash.

By all means, lower your taxes if you think it will attract jobs. But lower
them for everyone.

------
ComputerGuru
Having read the very interesting and thoughtful debate arguments being made in
the comments here, I have nothing more to add than to state that this isn't
anything new, even if the exact means employed and the parties involved are.

It's a textbook "tragedy of the commons" where, as @konschubert said, the USA
los{es,n} out for every dollar spent. But this was never about maximizing
revenue/growth/benefit for America, it was cities trying to edge out one
another for their own local maxima.

This is also a textbook bidding process, with players holding the cards close
to their chest and trying to give up as little as they can while undercutting
the competition by as small a margin as they could. The only way to win in a
prisoner's dilemma is to collectively not play, something that numerous
psychological studies have found to be something humans just aren't good at.

The only part of this that _should_ be illegal (and probably _is_ ) is the
reveal that there are two HQ2.5s.

~~~
metalliqaz
how is that probably illegal? For that to be fraud they would had to have
contracts with the contestants the specify otherwise.

------
em3rgent0rdr
the game of local governments competing to lure big corps with handouts
deserves most of the blame. However it is interesting that this game is a
result of a prisoners-dilemma phenomenon: although all local governments would
be better off if they collectively agreed or otherwise cooperated to NOT
entice big corps with special handouts (as the big corps will build in one of
them anyway without any subsidy), however all it takes is for one major local
government to start waving some incentives for the rest to give in to the
game. CNN did a good video on this phenomena:
[https://www.cnn.com/videos/cnnmoney/2018/03/13/amazon-
hq2-or...](https://www.cnn.com/videos/cnnmoney/2018/03/13/amazon-
hq2-orig.cnnmoney)

------
pauldprice
I learned years ago that most RFPs are a massive waste of time and effort. But
why should the process be illegal? If cities want to compete, so be it. If the
citizens don't like it, then vote out the city council. Corruption is
illegal... This headline and article are link bait, at best.

------
enturn
> the Supreme Court avoided a final judgment on the matter by finding
> unanimously that the plaintiffs did not have standing to bring the suit.

Perhaps existing businesses have a standing to bring a suit by arguing that
they already provide jobs. Maybe they already receive a proportional tax
benefit?

------
jimbobimbo
Why federal government (that's article's argument) should be in the business
of deciding what kind of agreement local government and private company had
reached?

Whenever feds post RFPs for their projects, they put a lot of conditions that
company must comply with in order to even be considered. How is this different
from what Amazon does?

Amazon has fiduciary duty to their shareholders; local governments have
responsibility to their constituents. If both are aligned - why anybody else
should have a say in the matter?

You may like or dislike the contract, but as long as both parties are not
coerced into the contract (surprise: the city can opt out from bidding!), who
cares? The last thing this country needs is more fed involvement.

~~~
dragonwriter
> Why federal government (that's article's argument) should be in the business
> of deciding what kind of agreement local government and private company had
> reached?

Assuming the private company isn't doing purely in-state business, the
Commerce Clause, and, if it's not either a natural person or an in-state
entity, insofar as corporations and other artificial juridical persons are
creatures of the chartering governments, the Compact Clause.

~~~
jimbobimbo
Sure. Only the moment federal govt decides to use that to restrict Amazon's
(any company's, really) ability to choose locations, said location will be
moved outside of US altogether. Who'll benefit from that?

~~~
Apocryphon
Tech companies are so constrained to the West Coast that the HQ2 talent show
was a big deal in the first place. It's incredibly doubtful that they have the
capacity or the will to move outside the U.S.

~~~
jimbobimbo
Canada is right around the corner.

~~~
Apocryphon
If Amazon had wanted Toronto for HQ2 they would have chosen Toronto for HQ2.

------
teh_klev
This happened in Scotland a few years ago. Scottish Enterprise and the
embryonic Scottish Parliament enticed Hyundai's semi-conductor business to set
up shop in Dunfermline. Millions were spent on inducements on Hydundai for
them to then pull out of the deal and go somewhere cheaper.

Ironically the building is now occupied by one of Amazon's distribution
centres, no doubt funded by more public money and employing staff on zero hour
contracts with terrible conditions (which the Scottish press reported on).

I wonder why we can't spend these vast sums of money nurturing local
indigenous SME's and startups (and I don't mean the sort that involve
glorified ToDo lists).

------
sonnyblarney
Government should ban the subsidization of any specific companies.

Maybe they can give subsidies to businesses under a certain size, or maybe
industries wherein there are several players ...

But individual corporate subsidies are irresponsible.

Should be illegal.

------
dnautics
> Congress should institute a federal tax of 100 percent” on corporate
> subsidies, Jack Markell, a former governor of Delaware, wrote in The New
> York Times. “This would not include investments in public infrastructure,
> work force development or other investments that can attract employers while
> also providing a significant long-term benefit to taxpayers

That's an awfully ill-defined criteria. And anyways contractors for building
roads or towing cars, for example are incredibly corrupt too.

------
joewee
Amazon is going after the federal market in a major way, they MUST expand in
the Virginia market. They really have little choice if they plan to support
the federal government. They would have moved into the area regardless,
crystal city is right next to the pentagon and close to dc. So I think they
would have picked that area regardless knowing they prefer urban areas for
office locations.

~~~
aidenn0
When I first heard Crystal City, I was thinking first that you couldn't pay me
enough for that commute, but then on reflection, if they pay bay-area prices
you could afford to have a house between I-395 and the Potomac which would
make your commute under 30 minutes.

------
nusq
Cooperation between cities and cartel is no illegal. Cities were caught in a
prisoner dilema and forgot to cooperate.

------
chasd00
the best answer is the town should just have a vote, "we're going to offer
between x and y incentives. yes/no?". That's the easiest and most appropriate
way to handle it, let the town decide they're the ones paying the taxes
anyway. If the people want to go for it then fine.

------
umanwizard
What is wrong with it? It's a market solution to Amazon ending up in a city
that wants it the most.

Logically, the people who believe "Amazon ruined Seattle" should support a
system where the cities that actually want Amazon there can incentivize it to
come there and thereby avoid other places.

------
dopamean
Random question... When Walmart wants to open a new Super Center in a city
that doesn't have one do they get incentives from the municipality for that?
How often does stuff like this happen at smaller scales?

------
clamprecht
Does the Equal Protection clause of the 14th amendment apply to laws that
affect businesses? If so, then these kinds of perks may be illegal. But I
suspect that equal protection only applies to humans. Lawyers?

~~~
krrrh
Hayek proposed a new amendment that would state, “Congress shall make no law
authorizing government to take any discriminatory measures of coercion.” [1]
Which would help end this sort of structural corruption.

Corporate welfare is one of the plainest examples of the state using its power
to transfer wealth from the general population to the ablest and wealthiest
among us. It’s immoral at a fundamental level, and as stated in TFA,
corrupting the economy and society in this manner is a bipartisan practice.

[1]
[http://alex.kozinski.com/articles/Three_Amendments.pdf”](http://alex.kozinski.com/articles/Three_Amendments.pdf”)

~~~
dragonwriter
> Hayek proposed a new amendment that would state, “Congress shall make no law
> authorizing government to take any discriminatory measures of coercion.”

All substantive law authorizes government to take measures of coercion
(otherwise, it has no compulsory enforcement, and is effectively
recommendation rather than law.)

All law distinguishes on some axes, and thus is discriminatory on some basis.

So, Hayek’s proposal amounts to “Congress shall make no law.” Which clearly
solves any problem with laws Congress makes, but creates a whole host of _new_
problems. (The system under the Articles of Confederation failed over a less-
intense version of the same problem such an amendment would create.)

~~~
krrrh
Of course you understand why the proposal as you interpret it would not be
workable, which is why that isn't what he proposed. He proposed banning
_discriminatory_ measures of coercion. IE, you couldn't pass a law that
allowed some classes of people to steal and others to not steal. That seems an
obvious principle of law. Presumably such an amendment would mean that you
couldn't have a military draft that only applied to men and not to women, and
it would have invalidated laws that gave preference to men in inheritance or
property (the goals of the failed Equal Rights Amendment are a subset of
Hayek's proposal). Under most interpretations that I've seen, it would still
allow social security, welfare or basic income, and progressive taxation since
all classes of people could expect to age or move in and out of different
income brackets in their lifetime. It would probably also still allow for
broadly applied Pigouvian taxes, but I'm not a legal scholar.

The point in the context of this discussion is that you would nearly require a
constitutional amendment to enforce the basic principle that a law should
apply fairly and equally to all. Think of it adding the idea of equal
obligations to balance the idea of equal rights. If we want an antitrust law
that applies to businesses, then it should also apply to the business of
baseball [1]. If we are to have a copyright that expires, then there should be
no special exemption for the works of Mary Baker Eddy, but as a matter of
legal principle not religious freedom [2]. It would challenge all sorts of
special exemptions for specific companies and industries, and reduce
corruption by making a large amount of lobbying pointless.

[1] [https://slate.com/news-and-politics/2002/07/why-does-
basebal...](https://slate.com/news-and-politics/2002/07/why-does-baseball-
have-an-antitrust-exemption.html)

[2] [https://www.nytimes.com/1987/09/23/us/christian-science-
text...](https://www.nytimes.com/1987/09/23/us/christian-science-text-s-
copyright-is-ruled-illegal-by-appeals-court.html)

~~~
dragonwriter
> Of course you understand why the proposal as you interpret it would not be
> workable, which is why that isn't what he proposed.

It's exactly what the quoted text presented as his proposal was; I don't
really think enough about Hayek to go and research whether a direct quote
presented as his is accurate or not (on the principle that whether or not it's
what Hayek proposed, it _is_ what the person on HN name-dropping Hayek is
bringing into the discussion, and the accuracy of the attribution isn't of
paramount concern to me.)

> He proposed banning discriminatory measures of coercion

You seem to think “discriminatory” without any qualification means something
like “discriminating on illegitimate axes” or “discriminating on non-germane
axes”, which has two problems: first, that's not what the bare word means, but
secondly, even if it did mean that, the Constitution _already_ has been
interpreted as affording such protection against federal action (which is all
the proposed text addresses, and rather clumsily at that) under the Due
Process Clause of the 5th Amendment and the Due Process and Equal Protection
clauses of the 14th Amendment.

If Hayek wanted to fine tune the applicability of those to either explicitly
add to the list of illegitimate bases for discrimination, or to alter the
tests in applying them, then the text offered is far too nonspecific.

> Under most interpretations that I've seen, it would still allow social
> security, welfare or basic income

Basic income I can see, maybe. Social security discriminates on age and other
bases (including sourc of labor income, on the payment requirement side),
welfare discriminates on family status and income. How those are allowed in a
sweeping ban on “discriminatory” applications of coercive power is...far from
obvious, unless not it only invokes the kind of balancing tests already
applied by the existing Constitutional guarantees against unequal treatment.
In which case, we already have that.

> The point in the context of this discussion is that you would nearly require
> a constitutional amendment to enforce the basic principle that a law should
> apply fairly and equally to all.

A point that was clear with regard to state law before Hayek was born, so we
adopted an federal amendment for exactly that purpose.

~~~
krrrh
From what I can tell the quoted proposed amendment was a line in an interview,
and meant to get across the general principle, I don't know if he fleshed it
out elsewhere in a more exact manner. So your comments about the inadequacy or
clumsiness of the wording, or inadequate sourcing are fair. As are criticisms
of my own clumsiness in trying to connect the principle of equal treatment
under law to the idea that taxes and regulations should also be equally
applied as written.

> under the Due Process Clause of the 5th Amendment and the Due Process and
> Equal Protection clauses of the 14th Amendment.

It should be admitted that the existing federal amendments weren't enough to
convince the proponents of the ERA that there was enough protection from laws
discriminating on sex. You can add the uniformity clause of article 1 to
constitutional provisions that could have limited the ability of the federal
government to subsidize some businesses at the expense of others, but neither
it or the 14th amendment did.

The constitution-as-interpreted does not stop congress, state, and local
governments from being able to grant exemptions from a range of taxation and
regulations to specific businesses by name. Courts don't believe that this
violates any existing constitutional restriction, though I'm arguing that it
does violate the spirit or principle of non-discrimination and equal treatment
under law. It's the source of a great deal of corruption and abuse of the
powers of government, and would seem to require a constitutional constraint on
congress to reduce it since democratic incentives don't seem to work and
actually seem to make it worse. Existing constraints aren't broad enough, and
perhaps Hayek's is too broad for your taste, or perhaps you believe the goal
can be achieved without resort to the constitution. It doesn't change the
argument that there are inadequate restrictions on the worst forms of
corporate welfare, if you agree that we should have less of that sort of
thing.

Is your argument that there is no possible amendment that would thread the
needle of preventing corporate welfare like the Amazon subsidies without
severely restricting all congressional action? Or do you have wording that you
think might?

Maybe Jack Markell's proposed law which is mentioned in the article is good
enough, but I'd like to see something that restricts the transfer of money
from the general population to the best off and that would prevent moral
travesties like giving billions of taxpayers' money to one of the most
successful companies in history or professional sports teams.

------
randyrand
Or, extend this privilege to all companies and citizens. Competition is a good
thing. Just as companies compete for our business, cities should compete for
our residence.

------
stusmall
I don't know about illegal, but our local governments should be smarter than
falling for that trick to get a massively regressive tax set up. What a scam.

~~~
jdmichal
Prisoner's dilemma. Not bidding is a great decision and probably globally
optimal for the players. But once _one_ bid is entered, the rational choice
for all other actors is to also bid.

~~~
aidenn0
At some point the tax breaks mean that increased revenue will not offset the
increased infrastructure costs; at that point bidding is no longer rational.

~~~
jdmichal
I said it's rational _to bid_ , not _to bid until it hurts_. Bidding is, in a
way, discovering who it would benefit the most to perform an action. Those
that will be benefited the most will have the largest margin and therefore
will be able to support the highest bids.

~~~
aidenn0
What typically happens in real life is that those that bid the highest have
either underestimated the costs or overestimated the benefits.

------
danmg
State and local governments who submitted proposals and who were rejected
should charge them with quid pro quo bribery in each jurisdiction.

------
tyingq
Of course, if you push too hard, jobs move to a different country.

~~~
detcader
Why are corporations moving out of the US to different countries? Why can't
they stay?

~~~
Retric
A better question is why don't companies move outside the US? Why do they
stay?

And the answer to that has nothing to do with taxes, it's all the things taxes
pay for like an educated population, low crime rate, rule of law etc etc. On
top of that warehouse jobs can't be moved outside of the US due to shipping
latency.

------
tathougies
I am against corporate giveaways, but I also am against making it illegal for
legislatures to legislate. Such things shoukd be handled by the electorate
voting out the lawmakers who swindle them through taxes with little to show.

~~~
moate
What about the electorate voting in candidates that are in favor of banning
this practice and those candidates exercising the will of the people by adding
a law to the books to prevent this sort of giveaway? If the people want it
changed in the future, it can also be undone in a similar manner?

------
kukx
"Every year, American cities and states spend up to $90 billion in tax breaks
(...)" Is reducing taxes really equivalent to spending? I do not think so.

------
onetimemanytime
Let me simplify things, USA is great in one way: it has 50 states and
thousands of other jurisdictions with their local laws and taxes. Now Amazon
said that we plan on bringing xx thousand employees with XXX million in tax
revenue and other benefits. Which city can give us a better deal, considering
our volume? You buy a screwdriver for $12 but if you want 1 million
screwdrivers, the price might drop to $2 or they'll ask you to buy the
factory.

So, Amazon asked for offers from 50 US states represented by the BEST (a joke
maybe but...) people elected by their voters. If they agreed to it, what's the
problem? NY and NYC can hire every law and accounting firm in the country they
want to vet it out...who are you to question it, what are your qualifications?
Will the restaurants in Queens not report higher sales because of AMZN 25
years from now? Or dry cleaning outfits, dog walkers and therapists? That's
MONEY. More or less, every penny they'll make it will be taxed (prob twice) in
NY.

