More evidence has emerged today in the Wall Street Journal that subsidies for movies are poor investments. It’s a must-read for politicians.
Glenn Reynolds of Instapundit writes:
Of the nine “Best Picture” nominees in 2012…five were filmed on location in states where the production company received financial incentives, including “The Help” (in Mississippi) and “Moneyball” (in California). Virginia gave $3.5 million to this year’s Oscar-nominated “Lincoln.”
About $1.5 billion in tax credits and exemptions, grants, waived fees and other financial inducements went to the film industry in 2010….
He concludes that the money is a poor investment:
The $1.5 billion in subsidies that states provide, according to the Center on Budget and Policy Priorities, “would have paid for the salaries of 23,500 middle school teachers, 26,600 firefighters, and 22,800 police patrol officers.” Or it could have gone to cut taxes on small businesses, which, as [actress Eva] Longoria noted in her DNC speech, produce two out of three jobs in the economy.
If the economic case doesn’t weigh up, why are politicians doing it?
There’s two reasons:
- The cynical reason is that it’s down to cronyism among the elite, who like to shoulder up with the stars. Politicians like the shallow publicity they get for the effort. As well as the photo opportunities, they imaginethe public love the narrative of potential jobs and shifts in economic framework from ‘old’ jobs to ‘new’ modern information-age jobs. Reynolds says:
Politicians like to offer this largess because they get photo-ops with celebrities… George Mason University’s Adam Thierer has called this “a growing cronyism fiasco”.
- The other reason is that despite the rubbish economic rationale they use, politicians understand the great intangible: pride. For deep psychological reasons, what’s on the screen is more real than life itself. If your town, state or country is on the screen, you feel better about yourself. The rest of the world couldn’t give a damn. But you, the voter do, and to politicians, that makes it worthwhile spending your money.