Amazon and the End of the Growth Machine

Cities once worshipped job creation at any cost. The crumbling of New York’s HQ2 deal suggests they’re finding a new religion.

Jeff Bezos over the city skyline
Photo illustration by Slate. Photos by Chip Somodevilla/Getty Images; King of Hearts/Wikimedia Commons.

I’m breaking up with you before you can break up with me.

That was the gist of Amazon’s Valentine’s Day announcement canceling its plans to build a large regional office in Long Island City, Queens, across the river from Midtown Manhattan. Polls showed 56 percent of registered New York state voters supported the company’s arrival in the city, with approval rising 58 percent in the city, 70 percent among black New Yorkers, and 81 percent among Hispanic New Yorkers. But a vocal cohort of city politicians, angered by the secret deal struck between the company, the city, and the state (and for the most part, angry to have been left out of the room), had signaled their intent to revise or halt the company’s plans. And they sensed enough grassroots discontent with the deal to give them cover.

Amazon saw which way the wind was blowing. On Thursday, three months after announcing the results of its pageant of civic debasement, the company changed course.

Like the company’s threats to Seattle over a corporate tax to support homeless shelters, or an earlier ultimatum to the state of Texas over fulfillment-center taxes, it’s a sign that Amazon will brook no dissent from the jurisdictions in which it operates. It’s also an astonishing rebuke to the political instincts of the city’s mayor and governor, who evidently thought they had caught the golden goose, only to find that the goose’s helipad, poor treatment of workers, and mercenary deal-making were not in fact so popular. For Andrew “Amazon” Cuomo, who has bent New York Democrats to his will for eight years, it is a career low.

But it also marks a significant rupture in the decades-old symbiosis between American cities and American commerce and industry—that is, to the idea of the city as a “growth machine.” In a famous 1976 essay, the sociologist Harvey Molotch wrote that growth was the very raison d’être of an American city. “The political and economic essence of virtually any given locality, in the present American context, is growth,” he wrote. “A common interest in growth is the overriding commonality among important people in a given locale.” It’s the reason why cities shell out for sports teams and corporate relocations, and try to get people to move in.

Molotch’s city was an onion of self-interest. At the core were big landowners and real estate developers who wanted to profit directly from land use intensification, allowing, say, the replacement of a tenement district with skyscrapers. Second came a larger, more diffuse class of businesspeople who would benefit from increased population and traffic, like newspaper owners or department-store magnates. A third group was labor, especially building trades unions. Finally, in the most generous interpretation, the growth machine would benefit everyone by providing increased tax revenue for public services. Most people, most of the time, believe it.

Under New York Mayor Michael Bloomberg, then–Deputy Mayor Dan Doctoroff routinely made the progressive case for expanding New York City’s tax base: “In order to be a progressive city, a city must be prosperous. In order to be a prosperous city, a city must grow.” It’s more or less the same argument that de Blasio made for Amazon, thought without much gusto.

The growth machine might sound like a far cry from the NIMBY-driven discourse about cities now. Molotch thought so. But NIMBYs weren’t all anti-growth. With their tolerance for corporate welfare, rejection of social programs, and fierce resistance to new housing, homeowners did an excellent job growing their own tax bases. They were their own growth machine, Mike Davis observed in City of Quartz: “Los Angeles homeowners, like the Sicilians in ‘Prizzi’s Honor,’ love their children, but they love their property values more.”

(There are prominent and important exceptions to this theory of money-driven politics: Height limits in San Francisco were defeated three times in the 1970s, but the city in 1986 passed a growth limit that offered few conceivable financial benefits. In the same year, Los Angeles passed citywide buildings restrictions on major commercial corridors. Both measures passed after California had enacted Proposition 13, which reduced the relative importance of property taxes.)

A good example of this Growth Machine 2.0 is Silicon Valley, which has welcomed job creation but stifled new housing, bringing about an affordability crisis. Or a city like Chicago, which has encouraged new housing and offices in select areas while preserving vast swaths of homes with zoning and historic designations. Growth is not inconsistent with NIMBYism if you view the latter as defined at its heart by a kind of resource-hoarding, whether that resource is classrooms or parking spaces or views or tax revenue.

This NIMBY-growth compromise has been fine for city revenues, but it’s hardly thrown off perks for the working class. In fact, as housing prices increased, the spillover effects of new jobs began to decline. While the consensus has persisted among rich and poor that increasing the tax base is the unquestioned goal of city government, the growth machine has cranked increasingly for the benefit of the few.

In New York City in the 2000s, Michael Bloomberg downzoned vast swaths of the outer boroughs. “Homevoters are more powerful in urban politics than scholars, policymakers and judges have assumed,” researchers concluded, referencing William Fischel’s “homevoter hypothesis,” in which urban politics grows to resemble suburban politics, with its focus on preserving home values above all else. Nationwide, reformers turned a more critical eye to economic development gambits like stadium deals. Amazon has earned its share of ire in Seattle, where it’s generally thought to have contributed to a homelessness crisis.

But there is no precedent for what just happened in Queens. The opposition to Amazon was not really about the helipad. It was not really the company’s business model or its stance on unions or its work with ICE. It was not even about tax breaks. It was based on a more abstract, and more powerful, rejection of the fundamental assumption of growth-machine politics: the idea that any of that will do anything for me. 

In November, I wrote about how New York— and other high-cost cities— had wound up so skeptical of growth at any cost: “It’s in some ways symbolic of the troubled American economy at large, in which nominal good news (Dow 26,000!) is meaningless to an underclass increasingly without stakes (half the country has no money in the stock market). But it’s also a very particular indictment of New York’s prolonged state of housing insecurity, in which any good thing, from a bike lane to a grocery store to a corporate headquarters, is seen first and foremost as an excuse for a landlord to kick out a tenant.”

Homeowner takeover of city politics? Hardly: Homeowners ought to relish a major office development on industrial land. Instead, the rejection of Amazon reflects a breakdown in the biggest and most diffuse cog of the growth machine: the broader labor market. Fears of displacement and change outweighed appetite for the benefits of new jobs, including the long-term goal of well-funded public services. The outermost layer of the onion has been peeled off.

Molotch thought it might happen. “As the growth machine is destroyed in many places, increasingly it will be the business interests who will be forced to make do with local policies, rather than the local populations having to bow to business wishes,” he wrote. Unfortunately, Amazon does not have to make do. It will find another city where the promise of the growth machine endures.

True: The deal was popular in New York. But it wasn’t that popular, not for a once-in-a-generation influx of high-paying jobs. It wasn’t so popular politicians felt cowed into supporting it. Instead, the burden now lies on businesses and politicians to show why new jobs are good for people who won’t be hired for them. A rising tide is seen as a threat. An open listing is an invitation to an out-of-towner who might take your apartment. Forget the jobs mantra. New Yorkers want to know something more: What’s in it for me?

A similar rebellion took place a few years ago in Detroit, which would otherwise to seem to have the opposite problems of New York. In 2016 the Motor City became the first big city to adopt formal requirements for large projects to commit to community benefit agreements, an increasingly popular way to tie new development to local improvements. Developments that cost more than $75 million and receive any tax abatements or subsidies will have to meet with a nine-member neighborhood advisory council. It’s where’s-my-cut urbanism at work. Investment doesn’t speak for itself anymore.