Landing Amazon well worth effort

Landing Amazon well worth effort

State and municipal officials trying to lure businesses here have their hands full.

There's a national treasure hunt in which mayors of major cities across the country, including Chicago, are participating.

To the victor will go the incomparable spoils of economic development in the form of a second headquarters for Amazon, a $5 billion investment that, when completed, will provide jobs for up to 50,000 workers that pay salaries up to $100,000 each.

The mind reels at the impact such a facility would have wherever it's ultimately located. Suffice it to say, the mayor of the triumphant city will be grinning from ear to ear.

Chicago in recent years has enjoyed considerable success in attracting corporate headquarters of major corporations — Boeing, McDonald's and Caterpillar to name a few. They covet, among other things, the easy transportation to national and international markets available at O'Hare International Airport.

Despite that, however, the competition provided by Boston; Austin, Texas; Denver; New York City; Pittsburgh; and even Toronto will be brutal. That puts Amazon, which is looking for a metropolitan area of at least 1 million people, in the driver's seat, and it'll be demanding the same kinds of economic concessions that Wisconsin felt compelled to make to win the bidding for Foxconn.

That firm plans to invest $10 billion in Wisconsin to build a new manufacturing plant that produces LCD panels, creating up to 13,000 jobs after it's completed by 2020.

Chicago has many strengths, including a sophisticated business community, airports, a solid work force, top universities and high-tech capabilities.

But it will take more than that.

Speaking from Japan, where he's traveling in search of increased investment in Illinois, Gov. Bruce Rauner described Amazon as an "exciting opportunity" that the state and city will zealously pursue.

"I have personally been talking to senior executives at Amazon myself. Our economic development team at Intersect Illinois and our department of commerce is working very closely with the Amazon executives," he said, noting that the company already does business in the state and has "more than 9,000 employees" here.

"Our team is working with the city of Chicago's economic development team, as well as the regional teams around the state. And we're doing a coordinated, joint package of proposals that we're going to be submitting in October to Amazon," he said.

But there are problems with Illinois, ones that have been widely discussed in recent years, as the Seattle Times noted.

"Amazon has a caveat. The company wants an area which has a business-friendly environment. Guess their real-estate searchers can skip Illinois, as have other national and international firms recently seeking to expand. While Deerfield snared Caterpiller's new headquarters this year, it was an in-state transfer that has similar transportation and siting needs as Amazon," the Times stated.

Another publication also has dismissed Chicago as a serious competitor, writing it off in seven words.

"High taxes. Regulatory thicket. Tough worker competition," stated USA Today.

That newspaper might have added higher workers' compensation costs in Illinois than elsewhere. That means a lot, especially when the prospective employer is expected to create up to 50,000 jobs.

Rauner has acknowledged those problems, drawing immediate fire from Democratic gubernatorial candidate J.B. Pritzker.

"Bruce Rauner devastates the Illinois economy when he's home and then bad mouths the state when he's abroad," Pritzker campaign spokeswoman Jordan Abudayyeh said. "Rather than clean up the mess he's made, Rauner puts the damage he has done on full display in a backwards attempt to attract new businesses our state desperately needs."

That kind of political response is no surprise. Indeed, it's standard operating procedure. But it's off base because it presumes that businesses Rauner is courting know nothing about Illinois' economic circumstances.

But they do. No business contemplating investing millions of dollars would ever allow itself to be surprised by the economic atmosphere of the area where it's considering expanding. That's why Rauner said in Japan what he's been saying here at home for years — that Illinois must change if it's ever going to super-charge the state's economy.

"We have some of the greatest attributes to build businesses of any state in America. We also have some of the most heavy restrictions and regulations and highest taxes. ... Illinois tends to be one of the slowest-growing states. And it's despite O'Hare (International Airport), despite our infrastructure, despite our education. Those are world-class. It's because of our regulations and our taxes. So if we can change those — and we're working to do it — we've had some progress," he said. "Boy, we can boom."

That may not be sufficiently rah-rah for some people. But those who wish to stick their heads in the sand and insist Illinois' political status quo isn't a miserable failure are only fooling themselves and, perhaps, some of the people in Illinois.

It would be great if Chicago could land Amazon. It has much to offer. But it's also fighting to land this opportunity with one arm tied behind its back, and it will take a boatload of economic concessions to even the playing field.

Those who deny that simple economic reality are dooming Illinois, as compared with its neighboring states, to continuation of slower economic growth, higher unemployment, more people leaving than moving in and state budget shortfalls caused by too few people working and paying too little in taxes.

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