Amazon announced last Wednesday that they were pulling out of the deal to locate a second corporate headquarters in Queens, New York City. The company pledged thousands of jobs, hiring of local contractors and to develop state of the art technology campus to revitalize the neighborhood. To lure the huge firm to New York, Gov. Cuomo and New York Mayor de Blasio offered over $3 billion in tax and other incentives. Local politicians were blindsided by the incentive package triggering grassroots opposition. Amazon only allocated one person to work with local groups, who did not move into the area until the last few weeks. Too little local focus too late.
Let’s look at the real issue, the company coming in from Seattle is an outsider. To become a member of the community it needs to start with local leaders, interest groups and those possibly displaced by the move in. Plus, the company executives had to realizes there would be blow back about the incentives in a community that is concerned with affordable housing, healthcare and jobs for all levels of income not just high paid tech workers. The neighborhood leaders are going to be suspicious of an outsider to begin with, then add the huge corporate power of Amazon and the fight was on. Local politicians saw this move in as an example of big corporations taking advantage of local communities to make more profits for itself at the cost of taxpayers. The $3 billion dollars will not be spent on local programs, healthcare, job training, or affordable housing the community needs.
Executives should have realized they are joining a community, and needed to win over local leaders just as a resident might move into a new neighborhood and make friends with the neighbors first before building a monster home (changing the design to be acceptable). Companies are used to being able to get their way, make profits at the cost of local communities and not worry about the politics. Those days are over, the political tide has shifted from worshipping corporations to seeing them as having all the laws, rules of markets and labor go their way for the last 20 years. Including, millions of dollars corporations spend on lobbyists in Washington to ensure they maintain their advantage over citizens in the halls of power.
Companies have to see that they must design their corporate policies, programs, and worker relationships to build the common good. The common good can support companies taking initiative, innovating, and sharing their wealth, while still providing a good return to shareholders. Executives that balance the needs of the community with their requirements to make reasonable profits will be the most successful, others will find arrogance will lead to fights, lawsuits and new laws eventually hitting the bottom line.