Amazon’s Jeff Bezos announced a new philanthropic program Thursday which he dubbed the Day One Fund. Bezos committed to spending at least $2 billion on fighting family homelessness and creating a network of preschools. From the Seattle Times:
The Amazon founder, the world’s wealthiest person, said Thursday on Twitter that he would commit $2 billion to fund existing nonprofits working to help homeless families and create a network of nonprofit preschools in low-income communities. The initiative will be called the Bezos Day One Fund, borrowing from Amazon’s corporate mantra to approach tasks with the initiative of a startup’s first day.
The Day 1 Families Fund will make annual awards to organizations “doing compassionate, needle moving work to provide shelter and hunger support to address the immediate needs of young families,” while the Day 1 Academies Fund will start and operate a network of “full-scholarship, Montessori-inspired preschools in underserved communities,” Bezos said.
Here’s Bezos own announcement of the fund on Twitter:
— Jeff Bezos (@JeffBezos) September 13, 2018
While Bezos himself is connecting this announcement to his call for suggestions last year, there’s a more recent incident that may be part of his decision-making. A few months ago, Seattle passed a head tax on workers at top companies including Amazon which is based in the city. The purpose of the head tax, which was spearheaded by socialist city council member Kshama Sawant, was to raise millions of dollars to fight homelessness. But just a month after the tax was passed, the city council reversed course and repealed it.
Amazon did oppose the head tax and even stopped construction on a building downtown in protest. Amazon also donated a small amount ($25,000) to the effort to overturn it. But the truth is that the tax was opposed by a wide range of city residents, not just Amazon. A private poll taken before the head tax even passed found that 88% of city residents thought homelessness was a serious problem but 83% were unhappy with how the City Council was addressing it. Bottom line, residents did not want another tax.
Despite this, many stories about the tax called it the “Amazon tax” and focused heavily on Amazon’s opposition even though grocery store chains in the city put a lot more money into the repeal effort than Amazon had. The result was that Amazon took most of the blame even though it was far from alone in its opposition to the tax.
So maybe the focus of today’s announcement on homelessness is just a coincidence, but it seems possible the head tax story, which made headlines for months, contributed to Bezos’ decision to announce a big new effort to fight homelessness.
There might even be a bit of business strategy involved here. After Seattle’s tax was passed (and before it was repealed) the Seattle Times reported that other cities were considering something similar:
San Francisco, Mountain View, Cupertino and East Palo Alto are all considering similar taxes on large local employers (read: tech companies) to offset growing inequality and overcrowding they blame on the industry that turned them into boomtowns.
Killing the head tax in Seattle may have dampened some of that enthusiasm, but eventually, someone is going to try again. Maybe Bezos looked at that and decided a large investment in dealing with homelessness was not only a good thing to do from a philanthropy standpoint but also a smart way to make the case that the tech giant is already doing its part to deal with a major problem these cities are facing.