February 27, 2018 / 9:19 PM / in 21 days

Breakingviews - Georgia gives Amazon one great reason to stay away

By Rob Cox

The logo of Amazon is seen at the company logistics center in Lauwin-Planque, northern France, February 20, 2017. REUTERS/Pascal Rossignol

NEW YORK (Reuters Breakingviews) - Georgia just hoisted a massive red flag for Amazon. The $730-billion e-commerce behemoth is finalizing plans for a second headquarters. It had selected Atlanta among 20 North American locations drawn from hundreds of proposals. At stake are 50,000 jobs and $5 billion of investment. The Peach State’s Republican legislators have now given founder Jeff Bezos the best reason yet to strike Atlanta off Amazon’s shortlist.

Georgia’s Lieutenant Governor Casey Cagle, the leading Republican contender to occupy the governor’s mansion, launched a high-profile campaign to punish Atlanta-based Delta Air Lines for its decision to stop offering discounts to members of the National Rifle Association. Delta withdrew its goodies for the NRA amid threats of a widespread boycott of companies affiliated with the gun lobby following the massacre of 17 students in a Florida high school.

The one-time tuxedo-rental entrepreneur pledged “to kill any legislation” that benefits the largest U.S. airline unless it restores its NRA benefits. “Corporations cannot attack conservatives and expect us not to fight back,” Cagle tweeted. Delta receives a $40 million annual tax break related to jet fuel, which is up for renewal. Delta is the largest private employer in the state, with some 33,000 employees, and counts Hartsfield–Jackson International Airport as a global hub. The NRA is based in Virginia.

Tax breaks like the one Delta receives are bad policy to begin with. As a form of corporate welfare they are also antithetical to conservative capitalist doctrine. But doing away with them for reasons of cultural welfare is simply self-defeating. Cagle just sent a message to all companies that Georgia’s fiscal promises can be erased on a whim.

That’s especially true if Delta – and presumably rival United Airlines, as well as two of the largest U.S. insurers and the three biggest car-rental agencies – are making decisions derived from sound business practices. The calculus in severing ties with the NRA seems pretty simple. Losing the custom of five million firearms diehards is better than alienating the other 318 million American citizens, a majority of whom, polls show, support gun-safety legislation that the NRA opposes.

Atlanta’s mayor has said the city assembled “the most aggressive economic attraction package” in Georgia’s history, including $1 billion in incentives and infrastructure improvements, according to news reports. When Amazon lands its shiny new offices somewhere else, the people of Atlanta should know who to blame for their city’s loss.


Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.

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