“New Mexico Film Week 2018” is a wrap, and yesterday Errors of Enchantment was on hand for “NM Film & TV Day” at the Roundhouse. The gathering, organized by IATSE Local 480, follows a familiar pattern. Union boss Jon Hendy kicks of the festivities. (This year, he didn’t introduce himself. Why bother? Everyone present knew who he was.) Then a C-list thespian with some type of New Mexico connection is trotted out to extol the wonders of “organized” labor and the Land of Enchantment’s subsidies to film and television productions. A lawmaker then shows up to offer a pep-rally-style stemwinder, and a call to lobby his or her colleagues to maintain, if not enhance, taxpayers’ giveaways to Hollywood.
This year, the performer-as-lobbyist was Brendan Fehr, a dubious choice. His New-Mexico-shot program, The Night Shift, was cancelled in October. Fehr praised the state’s “film-friendly legislation,” and wailed that his wife and children had come to love their new home, and didn’t want to “go back to California.” (Prediction: The family will return within the year.)
The pol was Rep. Bill McCamley, a Democrat who’s running for state auditor. A shameless supporter of economic planning — he was a driving force behind the hideous boondoggle that is “Spaceport America” — the Mesilla Park solon expressed his desire to “create an economy that works for everybody,” not just the rich. (How enriching media moguls produces the outcome he’s looking for was not explored.) Hendry honored McCamley with a framed production still from Breaking Bad.
IATSE’s boss capped off the pseudo-event by getting political, assuring the faithful that the next governor — “she” — would surely “give us enough money” to keep working. At the very end, Hendry led the crowd in a scream-session. (“THIS IS WHAT DEMOCRACY LOOKS LIKE!”)
Over the weekend, Errors of Enchantment attended the New Mexico State Film Office’s “Education Summit,” which featured an army of educrats employed by the Land of Enchantment’s 21 (!) public higher-ed entities that offer courses in film-and-television production. (At the start of the event, an employee of the office literally carried IATSE’s water, hauling in a case of the union’s ubiquitous bottles of hydration.) The highlight of the summit was Grubb Graebner, a onetime playwright who found more a reliable — and doubtless, more lucrative — gig in education. He mentioned that the “industry” in New Mexico “all depends on state incentives,” and that it would be “gone tomorrow” without subsidization. No kidding.
Errors of Enchantment wasn’t able to attend each of the dozens of events held during New Mexico Film Week 2018, but it’s a safe bet that no mention was ever made of the broad and deep consensus that corporate welfare for billion-dollar studios is a loser. Whether on the left or the right, analysts concur. So does Michael Thom, an assistant professor at the USC Price School of Public Policy, who found that “incentives” are “a bad investment,” yielding “short-term wage gains, mostly to people who already work in the industry.” The latest state-level examination was conducted by the Joint Legislative Audit and Review Commission of Virginia’s General Assembly, which concluded that perks yielded “a low return in revenue to the state” — 20 cents per dollar for the commonwealth’s tax credit, 30 cents per dollar for its grant.
Rest assured, IATSE’s aggressive push to expand New Mexico’s subsidize-Hollywood policy architecture will only intensify. And many of the state’s elected officials will remain eager to hand your hard-earned dollars to an industry that does very little to create real economic development.
This morning’s ABQ Journal claimed the film industry contributes $505 million a year to the state’s economy. How is that economic impact figure derived and what does it include?
How much do the subsidies cost the state and what’s the net profit or loss?
I responded to Charles with a similar point, but here’s what I think:
I know it is a bit of a trite response, but I think this is the most reasonable, justified study of New Mexico’s program: http://www.nmfilm.com/uploads/files/Phase%201%20Report%20-%20Final%20Report%20%28July%2021,%202014%29.pdf
If people actually read it they’ll find that for every dollar spent, 43 cents is returned in the form of taxes. And, because of the way our GRT works, 10 cents of that is for local governments and 33 cents is for the state. So, for every $1.00 the State spends it gets back 33 cents. That is the very definition of money-loser. The “economic impact” and “jobs” data are all a smokescreen. If the government spends money on anything it is going to create a certain number of jobs.
The RGF has reported on this issue for years and described what a money loser it is for the state. Is there one study that you could recommend that estimates how much money NM loses on the film subsidy program? We need something to email to our friends. I’m always surprised at how many people in NM are convinced that the film subsidy program is a huge money maker for the state.
James and Charles —
I’d read Michael Thom’s 2016 study for the most recent macro examination at the national level. He’s a professor at USC, and concluded that most incentives “had little to no sustained impact on employment or wage growth and that none … affected motion picture industry GSP or concentration.” (Unfortunately, you must pay $36.00 for access.)
Here in New Mexico, the RGF has been documenting the research for many years. Here are some of our E/E posts:
Sony Dreamworks closing shows fallacy of film subsidies
Is the glass half-empty or half full on the film loan program?
New Study confirms film subsidies are a boondoggle
Subsidizing Hollywood: That’s a Wrap?
Yet another reason to yell “cut” on New Mexico film subsidies
A Deficit No-Brainer: Cutting Welfare to Hollywood
Hollywood: Leaving Louisiana
Latest New Mexico film study does nothing to keep program off chopping block
Is Rio Grande Foundation “shortchanging New Mexico’s film subsidy program?”
Film subsidy expansion would drain state’s coffers
I know it is a bit of a trite response, but I think this is the most reasonable, justified study of New Mexico’s program: http://www.nmfilm.com/uploads/files/Phase%201%20Report%20-%20Final%20Report%20%28July%2021,%202014%29.pdf
If people actually read it they’ll find that for every dollar spent, 43 cents is returned in the form of taxes. And, because of the way our GRT works, 10 cents of that is for local governments and 33 cents is for the state. So, for every $1.00 the State spends it gets back 33 cents. That is the very definition of money-loser. The “economic impact” and “jobs” data are all a smokescreen. If the government spends money on anything it is going to create a certain number of jobs.
Paul
Why don’t do a side by side comparison of the incentives give a good sized moving or TV show that is subsidized by New Mexico and the Facebook project? It should show how good a deal the Facebook incentives were and how lousy the Movie Subsidy is
Doug,
We’re not ecstatic about the Facebook subsidies either, but relative to film they are certainly a winner. It is almost impossible to realistically compare them because Facebook is receiving the benefit of foregone revenues while the film industry is able to tap into the budget directly to the tune of $50 million annually.
Has anybody quantified the likely impact of deregulation measures that won’t cost the taxpayer a dime? I’m talking about right-to-work, reducing occupational licensing, eliminating prevailing-wage rules for state projects, workers’ comp and tort reform.