Study: States' movie biz subsidies are a waste



A new study from the Center on Budget and Policy Priorities, in Washington, D.C., questions whether various states’ public subsidies of the film industry are worth the expense. The study, titled “State Film Subsidies: Not Much Bang for Too Many Bucks,” says too much money goes to moviemakers while not enough of it is spread around the respective states. You can see the entire report here. It begins with this introduction: "Like a Hollywood fantasy, claims that tax subsidies for film and TV productions — which nearly every state has adopted in recent years — are cost-effective tools of job and income creation are more fiction than fact.  In the harsh light of reality, film subsidies offer little bang for the buck."

Here are some important bullet points from the report:

State film subsidies are costly to states and generous to movie producers.

The best jobs go to non-residents.

Subsidies don’t pay for themselves, so state taxpayers bear the burden.

Most thorough studies show cost far exceeds benefit.

Supporters of subsidies rely on flawed studies.

North Carolina, of course, has been active in providing film industry subsidies for some time. The state ponied up $22.5 million for Fiscal Year 2010, which ranks 12th among the 50 states in amounts of money handed out to the movie business. The conclusion of the CBPP study puts things in pretty stark perspective:

State film subsidies are a wasteful, ineffective, and unfair instrument of economic development. While they appear to be a “quick fix” that provides jobs and business to state residents with only a short lag, in reality they benefit mostly non-residents, especially well-paid non-resident film and TV professionals.  Some residents benefit from these subsidies, but most end up paying for them in the form of fewer services — such as education, healthcare, and police and fire protection — or higher taxes elsewhere. The benefits to the few are highly visible; the costs to the majority are hidden because they are spread so widely and detached from the subsidies.

We'll see whether the new GOP rulers of the General Assembly will be willing to gore this particular sacred cow when the time comes.

The joke's on us
  • The joke's on us

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