How Cities Like Detroit Are Priming Themselves for Amazon HQ2 Bid
“In this case, the loser might be the winner.”
Dodge Fountain at Hart Plaza in downtown Detroit.
Thursday is the last day cities can place their bids as the location for Amazon’s second headquarters. You may have heard Detroit — and Dan Gilbert specifically — is making a real push to bring Amazon to southeast Michigan, luring the company with massive swaths of land in the city, Pontiac, and Sterling Heights.
But Detroit isn’t the only city with a vested interest in Amazon locating a massive hub within its borders. Far from it.
Cities — large and small — throughout the country are making their case.
Some might be accused of obsequious kowtowing. One mayor bought 1,000 products on Amazon, and wrote reviews of the products on the site. The city of Tucson delivered a 21-foot cactus to Amazon. Why? Hard to say — other than everyone wants to win the affection of the mega-company and the 50,000 jobs it promises to bring to a community. That’s an immense concentration of jobs and economic activity that will arrive in the winning city.
Here’s a video included in Detroit’s effort to win Amazon’s “HQ2” project:
But with one winner, there will be lots of losers. And as the tech industry and online retailers boom, it seems there are more and more loser communities whose industries are downgraded.
Detroit Today host Stephen Henderson speaks with a number of experts and reporters who have been following the bid process — here in Detroit and elsewhere.
“They’re going to now create a second winner-take-all city that is just going to have this immense outsize windfall of jobs and investment based on this one decision by this one company,” says ProPublica reporter Alec MacGillis, “which is kind of crazy when you think about it.”
“We (Detroit) have no option,” says Wayne State University professor of urban planning Robin Boyle. “Not to compete would be dumb… We picked a winner 100 years ago and it’s been wonderful.”
Boyle says the possibility of capturing 50,000 jobs is “incredibly attractive” and would be “incredibly powerful” in terms of stimulating demand across the local economy. But he also says it would not change the larger, underlying dynamic of Southeast Michigan’s economy. He says the long-term focus should be on what we’re already doing well to create a good economic ecosystem in the region.
Henderson also speaks with Ron Starner, executive vice president of Conway, Inc., and writer for Site Selection Magazine. He says no company has ever created 50,000 jobs in one area as quickly as Amazon says it will, meaning those results would be unprecedented in American history — and are not a sure thing.
“It is a huge bet,” says Starner. “And no one knows what the exact outcome is going to be. If they do hit that upper number, then yes, the payback will be huge. But it will only be huge if the winning community does not overpay for the project.”
Starner also points out that a project like this from a company like Amazon would also be very disruptive — both to the existing economy and to the culture surrounding it.
“In this case, the loser might be the winner,” he says, saying that the winning community may need to include billions of dollars in incentives to win the Amazon bid.
Click on the audio player above to hear the full conversation.
