Traditional American community life in the shadow of tech giants

Winner of winners

Amazon is the winner of the winners. Its first-quarter sales were more than a quarter higher than a year earlier, even as overall retail sales plunged. In mid-April 2020, just as the pandemic was nearing its deadliest phase, Amazon's stock was surging, up more than 30% for the year, while Bezos' net worth increased by $24 billion in just two months. In late July, Amazon announced that its second-quarter profit had doubled and sales were up a staggering 40 percent from a year earlier. The company's share price soared on the news: in early September, it was up 84% for the year, more than double the rise of other tech giants. In a note to investors, one industry analyst said: "Simply put, in our view, the COVID-19 pandemic has injected a growth hormone into Amazon."

To handle the surge in business, Amazon added more than 425,000 employees worldwide between January and October of that year, bringing its total non-seasonal workforce in the U.S. to 800,000 and its global total to more than 1.2 million (a figure that doesn't include the 500,000 drivers who deliver packages), a 50 percent increase from the previous year. To accommodate these workers, Amazon has gone on a building and leasing spree, opening 100 buildings in September and adding nearly 100 million square feet of warehouse space by the end of 2020, a roughly 50 percent expansion rate. Warehouses aren't the only part of the company in high demand: As hundreds of millions of human interactions move online every day, Amazon's data centers are expanding for customers like videoconferencing software company Zoom.

In midsummer, Amazon announced the huge profits it had made during the coronavirus pandemic on the same day that the Commerce Department reported that the U.S. economy shrank by nearly 10 percent, the biggest quarterly decline on record. In other words, at a time when America as a whole is at its lowest ebb, Amazon is prospering more than ever: the fortunes of the company and the country in which it operates have diverged.

This profound imbalance of fortunes has largely contributed to the political upheavals of this era. And, as the horrifying year of 2020 draws to a close, it is clear that one of the first tasks facing President-elect Biden and the incoming administration will be to decide how to resolve this disagreement. The US cannot afford to let it continue to expand.

The vulnerable have borne the heaviest losses

While the COVID-19 pandemic has increased the concentration of wealth and power in some of the most dominant companies, it is possible to imagine ways that prosperity and dynamism could be spread more widely across the country. Manhattan's upscale apartment buildings are almost completely empty, and some New Yorkers who fled the city are considering moving out permanently. Some say the pandemic could mean the end of the office era, with us finally free to work from anywhere. Why spend so much money in a big city if you no longer need to report to a building downtown? Why not move to a quiet village up north, or even Syracuse, Erie or Akron?

These ideas, romantic as they are, have the aura of a simpler time, when Samuel Grunbach sent his son and son-in-law to the small Pennsylvania city to start the family business. But such thinking flies in the face of harsh economic realities. The digital economy has produced take-all companies and cities, and it is hard to imagine that the digital "leap forward" brought about by the pandemic lockdowns will not exacerbate winner-takes-all situations, with tech giants and the cities associated with them further consolidating their market power. Facebook seized the moment to lease the monumental former post office building across from Pennsylvania Station in New York and convert all 730,000 square feet into office space.

Amazon's announcement that it would add at least 2,000 white-collar workers to the former Lord's and Taylor's flagship department store on Manhattan's Fifth Avenue came as no surprise. There are currently more than 50,000 Amazon employees in Seattle, and the company has announced that it will add another 25,000 in Bellevue, across Lake Washington, by 2025 - with that, the Seattle metro area will absorb the same number of employees as the entire HQ2 complex in Northern Virginia, further cementing its long-established prosperity. While rents and apartment prices in the wealthiest cities are beginning to fall from stratospheric highs, the rising demand for office parks and apartment communities in New York's suburbs, for properties in western ski resorts and for the Hamptons school district suggests that any missing benefits will remain largely within the confines of winner-take-all metropolises and their satellite towns, and will never trickle down to smaller cities farther afield.

At the same time, the federal government's COVID-19 relief package only provides municipal aid to cities with populations of more than 500,000, and the financial situation of smaller cities will deteriorate further. There are already signs that restaurant and bar closings are hurting places like St. Louis and Detroit in particular, where a belated revival has been fueled in part by budding nightlife options. In August, American Airlines announced that it would stop flights to 15 small and medium-sized cities in China, which is bound to further accelerate the isolation and decline of these cities.