How did a Bachelor-watching nation not know where this Amazon thing was going? (SWWC vol 4, issue 8)
Hello!
(Editor's Note: This newsletter was delayed owing to Tinyletter's robots claiming it had triggered their content filters for offensive content. I'll leave you all to guess what set the robots off.)
I talked about this subject on a previous Download but I Have More Thoughts about Amazon's recent beauty contest for new branch offices and you all get to read them now.
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So! Amazon is opening some new branch offices in northern Virginia and New York City. The selections weren't surprising: Amazon is basically a cloud services company -- a look at their financial reporting will show that they make more money there than they do off retail, despite retail sales being higher -- and they're the favorite to win a $10 billion cloud services contract at the Pentagon. Also, NYC is a nexus for banking (another industry that is poised to go in big on cloud services) and it's a great jumping-off point for European travel, which is a plus when you're trying to suss out the concentration of AI talent in Cambridge.
It makes sense to put the branch offices where the target customers are: The company saves money on time and travel, and it increases its access to a talent pool that has both the skills and connections required to keep building the business.
That Amazon's decision sparked a lot of blowback is not surprising, because their entire process -- which came off as a season of The Bachelorette, only with more RFPs and fewer roses -- seemed to dangle the promise of equal access to opportunity, only to decide at the last minute that nah, they were fine letting the rich get richer.
Anyone who watches reality TV could have seen this coming. Quirky and offbeat candidates stick around only to heighten dramatic tension before the inevitable happens. In a country where capital and jobs are being increasingly concentrated in a few "superstar metros" like Los Angeles, New York City and San Francisco, a perfectly fine place like Denver or Raleigh is the civic equivalent of a short-haired contestant on The Bachelor — admired for being an outlier but useful only for advancing the narrative someone else ends up starring in.
So what? This whole business should have taught everyone the following:
1. Geography matters a whole lot. It is much more attractive to a company to set up shop someplace where there are already complementary industries and a plethora of talented candidates they can poach. This is great for employers, not so much for people who would like an Amazon-style career outside of a major urban center.
Another bit of news lost in the whole "Crystal City? What now?" kerfluffle is that Amazon's also planning on building a shipping and logistics HQ in Nashville, TN. This is notable for a few reasons: First, Memphis, TN, is the global HQ for FedEx, so there's already semi-local logistics talent that can be persuaded to move some 200 miles to the east. Second, Nashville's become a lifestyle hub for younger people who are looking for distinctive culture and/or outdoorsy activities and/or a foodie scene. It will be very easy to draw professionals to the area for the win-win combination of great lifestyle and great Amazon jobs.
The "superstar cities" story has been gaining momentum for the last few years -- there are massive political and economic implications when a company's productivity and a college-educated workforce are increasingly concentrated in a few cities -- and expect it to become a huge 2020 presidential campaign issue. I'm going to guess we'll see someone floating the idea that we need to reform policies that currently benefit "the coastal elite economy."
2. No one industry sector is beholden to reviving torpid urban economies. I saw a lot of pundit-y talk about how other cities "need" the tech jobs more than NYC or DC. Yet there are other industry sectors that generate a considerable percentage of the nation's gross domestic product (GDP) and we're not talking about asking healthcare companies or financial-services companies to revitalize "the heartland."
3. Amazon now has lots and lots of data on cities and their finances and they don't have to share any of it. Have we all forgotten that this is a company skilled at using data to leverage very good business deals? Amazon now has the deets on a few hundred different cities and they don't have to share, thanks to NDAs they had some cities sign. Imagine how they can sell or use that data to their advantage later.
Who cares? People who live in any of these cities who were prepared to hand over all manner of perks to Amazon while not extending similar benefits to the people who already live there, perhaps. Boston was offering Amazon employees zero-percent-interest loans for housing costs, something it does not do for people already living there. Atlanta offered free parking and an Amazon-only employees' lounge at Hartsfield-Jackson International Airport. Columbus officials offered to finally address what they call an "unacceptably high murder rate," a policy commitment that perhaps currently-alive citizens in Columbus would also appreciate.
Sometimes, cities do take rejections to heart and improve their infrastructure and quality of life for the better. Two hundred and thirty-five sites in North America now have Amazon's rejection as political cover to launch into projects that don't rely on Amazon to improve everyday life.
And sometimes, cities emulate those Bachelor contestants who look at the prospect catch, then think, "I see no reason to impress you at all." There is a rising body of evidence that suggests luring companies to your city is ultimately a bad deal for the people who live there. (One is reminded of how professional sports-league stadium deals have worked out.)
On cold winter nights, I plan to warm myself with the words of Toronto Global CEO Toby Lennox:
“Others may provide large subsidies and tax breaks, but like the Province of Ontario, we in the Toronto Region don’t want to play that game, and frankly we feel we don’t need to play that game.”
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Your pop culture recommendation of the day: ... is not so much about pop culture as it is culture-culture. This piece, "Museums don’t just want gift shops to make money — they want them to shape our understanding of art " instantly made me think of all of the following at once:
A. How, in the 9th grade, I went to see a production of The Tempest at the Virginia Museum of Fine Arts (a museum mentioned in the article) and bought my mom a celadon goldfish plate as a Mother's Day gift. This inadvertently kick-started my delight in non-European ceramics -- one of the joys of visiting Berlin is visiting the beautiful 16th-century Iznik pottery collection at the Pergamon -- and a lifelong pleasure in seeing Shakespeare performed live.
B. How, in the 1990s, if you pledged to a PBS or NPR station once in your life, you were instantly on the mailing list for Signals catalog with its slogan, "Gifts that inform, enlighten and entertain," and its offerings of umbrellas lined with Monet's "Water-Lily Pond, Symphony in Green" or magnetized sets of David or Venus de Milo with clothes you could put on. "Look!" the products said. "I am educated enough to both reference cultural works and be puckish about it!"
Anyway, I retain a soft spot for museum gift shops because I am fascinated by any retailing where the social experience is part of the sales pitch, and I like seeing how an already-curated collection gets curated further for commerce. Read the piece and get nostalgic for all those Alessi tea kettles you see in modern-art museum gift shops.
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