San Francisco and Silicon Valley. New York and Amazon. Now Seattle and a ‘head tax.’ The message to high-paying jobs is not in my backyard: Our view

In the annals of American capitalism, this is a peculiar chapter. Business innovation and wealth creation are occurring at a breakneck pace. And they are happening disproportionately in some of the most liberal, anti-business areas of the country.

California is home to five of the six most innovative companies in the world, according to Forbes. The Seattle area boasts Microsoft and Amazon, each of which has created nearly $1 trillion in shareholder equity in a little over a decade. And the areas in and around San Francisco, Boston, New York, and Washington, D.C., account for the bulk of venture capital.

It wasn’t supposed to happen this way, at least not in business school textbooks that preached the importance of low tax rates and light regulation as drivers of economic growth. But it did, largely because innovative companies gravitate to certain places, particularly ones that supply skilled workers.

High-paying jobs

Now, in the latest twist to the story, liberal groups in communities blessed with abundant, high-paying jobs are doing all in their power to chase them away.

This can be seen in San Francisco’s hostility to the tech employees to its south, many of which are pouring into the city and driving up real estate costs.

It is especially evident with Amazon, the tech giant that seems to be accumulating enemies. Last spring, activists in New York City essentially chased the company out of town after it proposed creating 25,000 high-paying jobs there — jobs that dozens of other communities were lusting after.

And this month in Seattle, where Amazon is headquartered, the company lost big in municipal elections — so much so that some see the vote as reigniting a drive for a controversial per-employee “head tax.”

In Seattle in 2018. (Photo: Ted S. Warren/AP)

OPPOSING VIEW: Tech giants like Amazon bring a cruel, mixed blessing

Here’s the backstory: Last year, the Seattle City Council passed a tax of $275 per employee on large companies. The move, in conjunction with an effort to enact a city income tax, was widely seen as a move against Amazon. While $275 per employee might seem fairly low, it would be easy to see the council increasing it each time it needed more money. Under intense pressure from local business, the council repealed the measure after less than a month of thought. Unmoved, activists have been pushing to bring it back. 

Tech companies’ positives

In a preemptive move, the Seattle Metropolitan Chamber of Commerce, with a lot of money from Amazon, pushed its own slate of progressive, but not wildly anti-corporate, candidates in this month’s elections. They lost.

The rest of the country is mystified at cities like Seattle, where successful companies are greeted with more resentment than respect and are seen as pots of money to be taxed. They would love to have its problems.

The attitudes toward Amazon reconfirm the view that some progressives are too quick to bite the hand of free enterprise that feeds them. Sure, tech companies can have some negative consequences on their communities. But these are outweighed by the positives, as will be readily apparent someday when the unemployment rate is higher. 

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