State doles out more Hollywood subsidies

by Joseph Perkins | June 8, 2011 9:39 am

JUNE 8, 2011


I love “Men of a Certain Age,” the sitcom starring Ray Romano, Scott Bakula and Andre Braugher that just began its third season on cable’s TNT. I do not love that the show was just awarded millions of dollars in subsidies courtesy of California taxpayers.

I suspect most Californians also will find it unseemly, if not downright outrageous, that the state is helping to pay the multimillion-dollar salaries of Mssrs. Romano, Bakula and Braugher.

Especially at the same time that Gov. Jerry Brown is proposing to extend previous tax hikes on personal income, vehicle registration and retail sales that were scheduled to expire at the end of this month (or so the state’s rank-and-file taxpayers were promised).

This is not to pick on the producers of “Men of a Certain Age.” For they  are not the only Hollywood recipients of corporate welfare.

In fact, 26 other television shows and movies are sharing $100 million gifted to them by the California Film Commission, including “Argo,” a Warner Bros. film being produced by George Clooney and directed by Ben Affleck, and Bachelorette Party, a 20th Century Fox film starring Jennifer Garner and Anna Faris.

Amy Lemisch, the commission’s executive director, describes the state subsidies to Warner, Fox and other Hollywood production companies as “modest.” And against the backdrop of a more than $15 billion state budget deficit, that may indeed seem a trifling sum.

I only wish that Everett Dirksen were alive today to respond to Lemisch.

The late great U.S. senator from Illinois, who made guest appearances on such noteworthy TV shows as “The Hollywood Palace,” “What’s My Line” and “The Red Skeleton Show,” would probably tell her something like, “A hundred million here, a hundred million there and pretty soon you’re talking real money.”

The film commission calculates that the 27 subsidized Hollywood productions will yield some $662 million in spending within the state – and sales and income taxes that go with that. The motion pictures and TV shows also are estimated to employ 3,048 cast members, 3,307 behind the scenes crew, while providing 49,778 days worth of work for extras and stand-ins.

Well, I have no quarrel with those estimates (though the exactitude of employment numbers requires some suspension of disbelief).  My quarrel is with favorable treatment the solons in Sacramento give some industries as opposed to others.

Indeed, the state uses dynamic analysis to justify the $100 million a year it has allocated to the film industry over the past several years. It doesn’t pejoratively refer to the allocations as “tax breaks.” It doesn’t fret about revenues lost to the state treasury.

It views the allocations as an “investment.” It credits them with generating economic   activity within the Golden State, creating jobs and keeping an important industry from fleeing to lower-tax states or moving much of its production out of the country.

Well, the same analysis could be used to justify tax subsidies for any number of California industries, including some that make a far greater contribution to the state economy than Big Film – like home building, agriculture, food service and oil and gas – but that don’t get anywhere near as much love from Sacramento.

The way to rectify the state government’s patently unfair, unequal treatment of California’s many different industries is for lawmakers to stop using the tax code to choose winners and losers. That means eliminating corporate tax breaks for the film industry – and every other industry – and using the recouped revenue to lower corporate tax rates across the board.

Under such a reform, the film industry will still come out a winner. But so will every other California industry.

Source URL: