The fiasco surrounding Amazon’s recent escape from New York reflects a broader, potentially devastating trend. By driving the Seattle-based behemoth out of the Big Apple, New York’s increasingly militant progressives have created a political paradigm that could resonate in cities across the country.
Simply put, after decades of trying to lure businesses, many cities are adopting political agendas—from minimum wage hikes to rent control and threatened tax boosts—that make them less attractive to both big firms and smaller businesses. This new development is being driven by demographic shifts as cities become more dominated by hipster radicals and increasingly polarized with little room for a middle ground between the very rich and the very poor.
Cities have traditionally been more left than the rest of the country, but now that ideological gap is widening. Chicago, New York and Los Angeles seem destined to embrace ever-more radical politics as the young, single population and the poor dominate the electorate. Only a handful of major city mayors, including Miami’s Francis Suarez, are Republicans, while pro-business Democrats, like Chicago’s Rahm Emanuel, are being replaced by ever more stridently progressive politicians.
Rising Socialism in Cities
Jeff Bezos should have seen this coming. He had already tussled with Seattle’s effort to tax his and other large firms to address homelessness and the lack of affordable housing. The city council-imposed homeless tax on large corporations was only repealed when Amazon—responsible for nearly 20 percent of the city’s office space—responded by stopping construction on a downtown office tower.
Even so, Bezos loosened his ties to the ever-more-progressive Emerald City. Amazon announced expansions in suburban Washington, D.C., and Nashville, places where costs are lower and politics far less pink. The online giant has also announced plans to lease out most of the new high-rise it is constructing in downtown Seattle and reportedly plans to move employees to the less politically fraught and more affordable confines of nearby edge city suburb Bellevue.
Amazon’s experience reflects the emerging new norms of locating jobs in inner cities. Companies in America’s most favored and bluest cities increasingly face a cascade of regulation that may make them think twice about expanding there—e.g., the limits to terminating employees currently being considered by New York’s City Council. Much of this reflects a sort of hubris. Mayor Bill de Blasio, who helped craft the original deal, lambasted Amazon for missing out on what he described as “the best talent in the world.”
In the past, tech firms sought to win over progressives by adopting their agenda on issues such as gay and transgender rights, climate change and racial redress. In New York last year, Amazon and its fellow oligopolies poured $600,000 in donations into Democratic campaigns, 10 times what they gave to Republicans.
Increasingly, the tech elite seems more like Lenin’s “useful idiots.” Appearing “woke” on social issues does not cut it with progressive firebrands like New York’s Alexandria Ocasio-Cortez, who openly regards tech and Wall Street billionaires as “immoral” class enemies deserving of being systematically stripped of their wealth. When Amazon withdrew, the country’s most glamorous democratic socialist trilled: “Anything is possible: today was the day a group of dedicated, everyday New Yorkers and their neighbors defeated Amazon’s corporate greed, its worker exploitation and the power of the richest man in the world.”
This is not just a New York phenomenon. An increasing number of millennials—soon to be the nation’s largest voting bloc—say that they prefer socialism to capitalism, threatening the future profits of Silicon Valley plutocrats. This sentiment is particularly marked among the educated young workers so coveted by tech firms.
Demographic Truths and Lies
As a rationale for choosing New York for its second headquarters, Amazon cited the city’s talent base—one reason Gotham and other big, dense expensive cities are promoting themselves as destined to become “tech towns” due to their young, motivated labor pool.