Reel Money: Should Taxpayers Finance Movies?

The State Investment Council has just agreed to lend $7.5 million at zero interest for three years to finance the production of a movie to be filmed in New Mexico. The film will tell the inspiring story of a man and his grandson who drift into Mexico and both fall in love with the same prostitute.
The opportunity cost of making such a loan is around $1 million, that being the returns that could be had by investing the money elsewhere. There is also an element of risk to be considered: presumably the loan is unsecured by property, and who knows how the production company figures its profits and hence its ability to repay the loan.
It’s said that 97 film jobs will be brought into the state, but only for the duration of shooting. That figures out to about $10,000 per job, some or perhaps most of which will go to movie makers brought in from Hollywood.
Is this a good deal for New Mexican taxpayers? Probably not. But as usual, we aren’t given enough information by the state to make a reliable calculation.
But one thing is for sure: No one will ever make a film in New Mexico without first paying a visit to Santa Fe to pick up some free money.