Amazon Goes Shopping

Why cities shouldn't sell themselves out to the online commerce behemoth

Caleb Walsh illustration

Seattle may be America's largest company town. As Amazon has grown into a sprawling online empire, it has invested heavily in its hometown.

The New Urbanist campus rising in Seattle's South Lake Union area is impressive. It's also cool that residents have early access to whatever services Amazon dreams up to revolutionize the world: delivery of pretty much anything in under an hour, from a six-pack of beer to a meal from a local restaurant to a light bulb. Similarly, you can hire a professional to unclog a pipe or fix your car, and soon Seattle will have grocery stores that allow you to just grab what you need and automatically be charged as you walk out.

With Amazon, Seattle is living — just a bit quicker — in the future. But it isn't all roses.

Amazon has brought the city the future, and that future is damn expensive. I'm not just talking about Amazon's services — which, while starting free, tend to take a bigger bite out of your wallet as they're developed into version 2.0. But just like those services, while Amazon has left beta and grown into an economic juggernaut, it has made living in Seattle much more costly. This is most clearly seen in housing.

The housing bubble briefly popped, but driven in large part by Amazon's appropriately well-paid workers, it's refilled in a hurry in Seattle. The average home price keeps going up at a dramatic pace (doubling in the past five years) and rents are rising even faster. Housing is a concern for almost everyone not smart enough to have been born earlier and bought before the latest boom. More than 10,000 people are homeless in the city.

So while more than a few of Seattle's politicians and the local chamber of commerce panicked at the recent news that Amazon plans to build a second headquarters — with more than 50,000 new employees — someplace else, others across the city breathed a sigh of relief.

Seattle can definitely handle more growth in the decades to come (and even without Amazon's second headquarters, it will keep growing), but the city needs to catch up with the urgent demand for housing.

All that said, Seattle is probably better off with Amazon, but then, beyond paying for its impacts through skyrocketing rents and mortgages, Seattle got Amazon during its initial rollout — which is to say it located in the city for free. Seattle didn't have to offer a package of tax breaks or subsidized land (it didn't hurt that Washington state has the most regressive tax system in the nation, but I'll leave that for a different column).

But now if cities like Spokane, for instance, want Amazon Headquarters 2.0, they're going to have to pay. And like a lot of Amazon's services, you're not going to realize just how expensive it is until you're already hooked.

So if you're a city leader out there desperate for growth (and trust me, I get that Seattle is in many ways blessed to have the problems it's got), my advice is not to participate in the Amazon hunger games. Don't spend the significant resources necessary to put together a bid that will require you to pay even more if you win.

I'm here from the future, and I'm telling you, there's a better way to grow.♦

John T. Reuter, a former Sandpoint City Councilman, has been active in protecting the environment, expanding LGBT rights and Idaho's GOP politics. He currently lives in Seattle.

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About The Author

John T. Reuter

John T. Reuter, a former Sandpoint City Councilman, studied at the College of Idaho and currently resides in Seattle. He has been active in protecting the environment, expanding LGBT rights and Idaho's Republican Party politics.