More Than Cash, What Amazon Really Looked for in Deciding H2Q

More Than Cash, What Amazon Really Looked for in Deciding H2Q

Amazon.com Inc. chose NYC and Northern Virginia as the locations for its new headquarters, referred to as H2Q. Understanding why Amazon chose these cities is crucial to understanding the trends of corporate America. Many would think that Amazon chose NYC and Northern Virginia because they offered the company the most financial incentive: $3 and $2.5 billion, respectively. The leading article on H2Q from the WSJ headlined, “Cash, Promises Won Amazon.”

However, as a later WSJ story indicates, Amazon’s search considered a host of other factors. This is especially true knowing that other cities offered more financial incentive than the elected cities. For instance, New Jersey and its industrial city, Newark, offered $7 billion, and Maryland offered $5 billion. So what were the other factors?

The factors that motivated Amazon’s decision illuminate the growing divide of big cities from the rest of America. Amazon’s list finalists included America’s major cities, which – according to Shayndi Raice and Janet Adamy of the WSJ – contains the accumulation of tech talent, wealth, the Democratic Party, and ethnic diversity in America. The accumulation of these elements continues separating America’s biggest cities from the rest of America.

Amazon stated that diversity was a key factor in its decision. Commenting on H2Q, Joseph Parilla, a fellow at the Brookings Institution, says, “For those that were watching [the Amazon competition] and using it as some sort of bellwether for how the coasts and the heartland are doing, they are coming away saying we’re still in an era where the rich are getting richer both in terms of people, companies and now cities.”

The bottom line is that as America’s biggest businesses continue to accumulate in the biggest cities, smaller cities will find an even greater difficulty catching up and attracting top businesses.

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5 Responses to "More Than Cash, What Amazon Really Looked for in Deciding H2Q"

  1. Snidely Whiplash   November 20, 2018 at 7:43 pm

    I hope Trump follows thru with his idea to do a “Teddy Roosevelt” style Trust Busting on Amazon. Amazon has stolen too many jobs…bad for America.

    Reply
    • DeepStateProvactuer   November 21, 2018 at 7:51 am

      Finally someone who understands the way a true laissez-faire system should look like! The market can’t make this kind of decision, only (a Republican) President should be determining what private businesses are too big.

      Reply
  2. News Maven   November 20, 2018 at 10:44 pm

    And they’re flat out ripping off the USPS, shorting them millions of dollars every single day. A box that would cost $25 via UPS, Amazon would pay USPS about $2-3 to ship the same size!
    The financial report last week said USPS lost $3.9 billion last year.

    Reply
    • DeepStateProvactuer   November 21, 2018 at 7:56 am

      This is a terrible argument that has evidence to substantiate it. In 2006, Congress mandated that UPS fully pre-fund retirement benefits for the next seventy five years! (https://www.congress.gov/bill/109th-congress/house-bill/6407)

      Note: This bill was sponsored by a ‘small government’ Republican, signed by President Bush.

      If you want to know why the UPS is losing money, that is why.

      Anyone who wants to negotiate bulk discounts with UPS is free to do so. Why is it that when Amazon did this, it is a bad thing?

      Reply
      • News Maven   November 25, 2018 at 1:05 pm

        Although I’m sure you meant USPS (not UPS) you are absolutely correct about pre-funding retirement for 75 years forward.
        Name me another business in America mandated by the government to pre-fund the retirement of their future employees who have not even been born yet!
        And BTW, first-class stamps go up 5¢ to 55¢ Jan. 27, so grab a few extra sheets of Forever stamps before then.
        That’s effectively a 10% savings.

        Reply

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