This city is in a state of worry. It has to see the whole HQ2 episode as having always been about Seattle. The first thunderbolt was the announcement of HQ2. It shook Seattle, which is now the biggest company town in the US, to its core. Before another bolt struck, the city wasted no time ending the head tax. Then it had to sit and wait to see how HQ2 would impact its economy. During this nervous waiting, the business community cursed progressives for their outrageous apostasy. And now we're watching New York City lose its half of the HQ2 prize. But is this really about NYC? No, Seattle thinks. It is yet another reminder of how easily Amazon can change its mind. Seattle will take notice. Long Island City lost thousands of jobs and billions in tax revenue. It will remain underdeveloped. This could be Seattle in a heartbeat.
And just to keep our already nervous city in line, Amazon immediately announced, according to Mike Rosenberg of The Seattle Times, that the corporation "will end its growth in Seattle in coming years." This means "the 25,000 jobs intended for New York" will not return to Seattle. In short, the city should not celebrate NYC's loss. We are still in deep trouble. We have not done enough to appease Jeff Bezos. Rosenberg: "Seattle could still get some of those jobs or benefit indirectly, though it’s too early to say, the company said."
Before you write the obituary for New York City, remember that a @Google just announced a $1b expansion here - and without the $3b in subsidies that Amazon bargained for. Yes, NYC could use those #AmazonHQ2 jobs. But we needed a new deal. https://t.co/2FmCkYIOXP
— Eric Klinenberg (@EricKlinenberg) February 14, 2019
What American workers often fail to understand is the importance of discipline in a market society. And with good reason. Political economists (now just called economists) have spent an enormous amount of intellectual energy to obscure this crucial aspect of the job market. In fact, it has even been argued by neoclassical economists that workers make the personal choice not to work (voluntary employment). And so, there is no such thing as unemployment but, instead, the personal decision not to work. Why? Because, even in a depression, the worker measures the value of leisure against the disutility of labor. If the former is greater than the latter, the worker decides to quit.
But in this thinking, the problem of the high cost of leisure is not factored in. The fact that leisure is not cheap (or free) in a market society means it imposes on those without wages considerable obstacles to other and often crucial parts of an economy: health services, mobility, consumption, housing. And it is here we begin to understand the old class war against government transfers like employment insurance, financial aid, social security. These programs reduce the cost of free time and, as a consequence, weaken the disciplinary power of unemployment. But it gets stranger. High wages also weaken disciplinary power of the business elite.
In 1943, the Polish economist Michał Kalecki, who is one of the key figures of the post-Keynesian movement in what is now called heterodox economics, wrote in the essay "Political Aspects of Full Employment" (PDF):
[U]nder a regime of permanent full employment, the "sack" would cease to play its role as a disciplinary measure. The social position of the boss would be undermined, and the self-assurance and class-consciousness of the working class would grow. Strikes for wage increases and improvements in conditions of work would create political tension. It is true that profits would be higher under a regime of full employment than they are on the average under laissez-faire; and even the rise in wage rates resulting from the stronger bargaining power of the workers is less likely to reduce profits than to increase prices, and thus adversely affects only the rentier interests. But 'discipline in the factories' and 'political stability' are more appreciated than profits by business leaders. Their class instinct tells them that lasting full employment is unsound from their point of view, and that unemployment is an integral part of the 'normal' capitalist system.
And so, on one side, you have voluntary unemployment, which means nothing but very hard times. On the other is full employment (which puts upward pressure on wages). Business leaders hate both.
But these practical aspects of market discipline can be quantified and measured, for example, by interest rates: high pain for workers; low job growth. There are others that are equally practical (pulling the plug on NYC; freaking out Seattle). But instead of reading this discipline for what it is, the powerless resort to the region of religion. The gods have spoken. They are upset. We have not done enough to appease them. What else can we do? Haruspicate or scry? Open one of the turtles in Lake Washington? What does its entrails tell us? This religious intensity is only compounded by the fact that Bezos has essentially an unlimited amount of money. And this limitlessness is nothing but the condition of a god. Here we have money, a social unit of power, achieving the condition of the supernatural. What does the billionaire of all billionaires, Bezos, want from us, Seattle? Should we toss something living into a volcano?