After more than a year of speculation, Amazon finally announced the location of its future HQ2 on November 13. Rather than going with a single city, as originally proposed, it will split the second headquarters into two equal-sized facilities in New York City and the Washington D.C. suburb of Crystal City, Virginia. It marked the end of a very long, very public corporate spectacle from the tech giant.
Businesses usually negotiate deals with minimal fanfare, but Amazon went big. It announced that it would be an open process—municipalities around North America could bid for the distinction of hosting the second headquarters, a facility expected to bring in 50,000 high-paying jobs and a massive, transformative tax base. The jostling that ensued was like watching 238 cities (including many in Texas) rush to the gas station to buy a ten-figure Powerball ticket.
Those tickets didn’t come cheap, though. The bidding cities offered incentive packages, which in Texas were kept confidential by city leaders. The public process ensured that every city that applied knew its competitors, creating a virtual arms race of incentives and downright embarrassing behavior: Calgary, Alberta offered to change its name; New York Governor Andrew Cuomo volunteered to change his name; Frisco said it would literally build its city around the potential headquarters. Notably, a handful of cities opted out of the self-marketing process, including San Antonio, which wrote an open letter to Amazon CEO Jeff Bezos declaring that “blindly giving away the farm isn’t our style.”
And after all of that, Amazon made obvious selections. New York City, which boasted about how its unique culture made it so appealing that it didn’t need to offer incentives, landed one of the two facilities (the state of New York coughed up as much as $2.5 billion); the D.C. metro area, where Bezos owns a home and the hometown paper, landed the other. And splitting HQ2 into two different locations was a shrewd move: Amazon will bring half the number of jobs initially promised to each area as it reaps the incentives (billions of dollars) and connections (the influence of twice as many federal legislators, for one) of both locations.
Amazon’s announcement will disappoint many residents of the cities that weren’t chosen, but especially those that made the shortlist, including Austin and Dallas (polling from April found that 44 percent of Dallas residents and 36 percent of Austinites said they “strongly support” it). The economic impact would have been dramatic. Some Texans have long had visions of a robust tech corridor between Austin and Dallas, imagining a smarter, sleeker Silicon Valley popping up along I-35. Amazon’s presence would have gone a long way toward making that dream a reality—not just because of the company itself, but because of the skill sets of workers they would bring to the city. In NYC and D.C., tech is just one industry among a constellation of them—in Austin or Dallas, though, tens of thousands of workers might have started at Amazon before pursuing their own ideas and launching their own businesses, leading the tech industry to dominate the city’s identity. The economies of each city would have been transformed by such an investment, too, creating a tax base that any city’s chamber of commerce would envy.
Even as those who dreamed of a transformed Austin or Dallas may mourn, there are plenty of reasons for others to breathe a sigh of relief. It would have heightened the cost of living, created spikes in real estate and commercial rent, worsened traffic, and warped the culture around it. For evidence, just look to Seattle, the home of Amazon’s first headquarters.
With 3.9 million people, the Seattle metro area falls between Dallas and Austin in size, and illustrates what can happen when Amazon becomes a linchpin of the economy and plops down tens of thousands of highly-paid new workers (mostly young men) into a city. It transforms swathes of the city into privatized playgrounds for its employees, creating benefits that only people with an Amazon employee badge can access regularly. It induces numerous local restaurants to pop up to support it, then leaves them to flounder when the customer base doesn’t show up—something that a tumultuous dining scene in a city like Austin could ill-afford. It worsens the existing affordable housing crisis, more than doubling the rent over an eight-year period (as rents in Dallas and Austin grew at slower—in Dallas’s case, much slower—rates). It effectively wields a political veto, capable of thwarting progressive laws on a municipal level and conservative legislation on a state level, ensuring that the only people who are happy with the way Amazon wields power are its executives. It creates a bleak dating pool, resulting in dating apps full of men with money, all-consuming jobs, and few social skills, which Texas women are unlikely to suffer readily. Amazon workers end up in a special social class, both formally and informally, which stratifies the city, making much of it inaccessible to those without a $150,000 developer salary. Economic stratification is already fairly pronounced in Austin and Dallas, and the idea behind it—that having a fancy job means that you deserve more than somebody without one—are not what you think of when you think about Texas values.
Neither Austin nor Dallas have shared what they offered to Amazon, but we do have a sense of how Dallas pitched itself to the company, thanks to some detailed reporting from the Dallas Morning News. The city stuffed an Uptown trolley car full of young, hip residents who could sell executives on the cool Dallas they knew and loved. The official responsible for leading the bid opined to the paper about trying not to check in with the company for fear of coming off as too thirsty. The team talked themselves through the stress and exhaustion by reminding each other that hundreds of other cities were all doing the same thing. Combined with the tax giveaways they offered, the cities—Austin, Dallas, and the other 236 applicants—essentially kissed Jeff Bezos’s ring for a chance to participate in Amazon’s pageant, only to have the company double dip on the incentives and tax breaks, pick two established front-runners, and leave Austin, Dallas, and fifteen other finalists (Nashville will get a regional center as a consolation prize) with nothing to show for the energy they invested in playing the company’s game.
That’s disappointing for those who imagined HQ2 kickstarting a booming tech hub deep in the heart of the Lone Star State. But what would have been truly disappointing is if Amazon had made a Texas city unaffordable, inaccessible, and devoid of its culture for the Texans who already live in it.