The Dallas Morning News recently published a piece that examined Amazon.com’s desire to establish a second corporate headquarters outside of Seattle. The paper noted that a city in Texas would be ideal for such a facility owing to the state’s business-friendly culture. Naturally, the piece touted Dallas as the perfect site for the new headquarters, but most of the points made apply to Houston as well. Also, Houston has a seaport, something that Dallas lacks.
Why is Amazon looking outside of Seattle to expand?
Seattle is putting in a bid to host the second headquarters even though it is already the venue for the first one.
The city government is missing the point of the expansion. Seattle has become somewhat hostile to private business, with a $15 an hour minimum wage, proposals for a state capital gains tax and a city income tax, mandated family leave, and regulations piled onto regulations that make it hard to do business in the largest city in the northwest. The city government of Seattle must know that the announcement is a shot across the bow. Enact more business-friendly policies or Amazon may just pull out entirely.
Texas as the new home of Amazon
Dallas (and of course Houston) can be considered the anti-Seattle insofar as business culture is concerned. Texas has tort reform, a low minimum wage, right to work laws, a very light regulatory regime, and low taxes compared to Washington State.
The state government in Austin has proven itself eager to provide special incentives to any business that wants to set up shop in the Lone Star State. From a purely bottom-line perspective, using the phrase that Sam Houston once used is a no-brainer, “You can go to hell. I’m going to Texas.”
But what about the social culture in Texas?
To be sure, there are some aspects of Texas culture that might give Jeff Bezos, the CEO of Amazon, some pause.
However, contrary to popular belief outside of the Lone Star State, Houston, and to a certain extent, Dallas is ethnically diverse, socially liberal cities where people show a certain neighborly regard to one another, as the rescue operations during Harvey proved. Houston has a great restaurant scene, with eateries opening rather than closing as they are in Seattle.
The cost of living is attractive as well
The final big advantage that Houston and Dallas have are the low Cost Of Living compared to Seattle. The tech boom and draconian land use policies have started to price middle-class people out of the Seattle housing market. Housing inflation is not as much a problem in Texas. Amazon would be able to attract first-class talent if it moves to the Lone Star State as a result.
