Wednesday, January 16, 2013

Chasing After Socialism

There are many who think Socialism is a horrid thing. Happily, movie conglomerates are not among them.

The B.C. government is working on ways to hold onto movie, TV and video game production, as Hollywood shifts work to other provinces and countries that attract them with generous subsidies and tax breaks. ...

The search for Free Money never ends, particularly if you're a hungry motion picture producer. However, some British Columbia officials are growing weary of throwing tax payer cash at movie makers.

... [British Columbia] won't involve [itself in] matching generous tax credits offered by Ontario and Quebec, said Bill Bennett, B.C.'s minister of community, sport and cultural development. ...

The fact that a government person thinks it's a bad idea to match other Canadian provinces' hot lust for socialistic largesse has caused a bit of consternation in B.C.

[There is] a petition sponsored by a group called Save B.C. Film, and its pitch for support underlines the industry’s need for the provincial government’s “enthusiasm for maintaining an attractive taxation scheme.” That is, bigger subsidies. ...

“We need your support,” the petition continues. “Without it, you jeopardize not only our industry standards, but our livelihoods as well ...

Subsidies are a grand old tradition, going back centuries. Transcontinental railroads were once built with them; today sports franchises (plus stadiums!) are supported with taxpayer millions, which the tax payers then get to watch after providing another large fee. (Everybody wins!)

But subsidies are, all too often, a self-defeating exercise. And the exercise is often short-lived and counter-productive. As VFX Soldier notes:

... US studios fall in love with a government that gives them free money. Governments runs out of money. US studios leave for the next sucker. ...

So you might ask why so many state entities pursue this madness? Quite simple. We live in the age of the corporatist nation-state, where the state's principle job is to aid and abet large, globe-straddling conglomerates. And if that damages everything and everybody who ain't a large corporation, well ... that's the price of liberty and "free enterprise" in the 21st century.

Visual effects entrepreneur Scott Ross sees the current reality clearly:

Subsidies are bad. They’re bad for the VFX industry, bad for the govt that is offering the subsidies, bad for the VFX worker that has to constantly uproot their families, bad for the VFX facility which has to chase the subsidy. The only group that these subsidies are good for is the Motion Picture Studio/producer.

Ross, of course, nails it. The conglomerates make out like bandits, which is the point. They're the ones with the juice, so they're the ones governments cater to.

Call it win-lose-lose-lose on the taxpayer dime.

15 comments:

Steve Hulett said...

Brother Oswald? I'm sure you'll want to rail about my two-faced hypocrisy. Have at it.

Oswald Cox said...

Steve, my heart is still warmed by the fantastic holiday party you put together for everyone. I'm not going to "have at you".

Especially when we agree on the semantics: hypocrisy it is.

Hollywood is a liberal town and the most powerful people in this town have been rallying around the message that the corporations and the wealthy "pay their fair share of taxes"...

But every chance they get the studio heads, the most powerful directors and producers, and even the star actors with pet projects, send their productions to another state or country to get out of paying the high taxes here in California.

Cementing the message I have been beating my drum about in here. The middle class of California has to be the dumbest cross section of people in the country because they just voted to raise taxes on themselves and subsidize the biggest, most profitable industry in Los Angeles; the movie business. A business that sidesteps paying those auspicious propositions for school funding whenever they can.

Ho hum...

tangerine8 said...

I don't like liberals very much and hollywood is filled with hacks.

Steve Hulett said...

Uh, Oswald?

Vancouver is a higher tax state than California. But Vancouver gives major subsidies to entertainment companies, so that's where the business goes.

If California was even more "socialistic" than it is (i.e., giving huge cash incentives to Hollywood) the moguls would happily keep the work here.

But California's tax breaks and subsidies are paltry, so the biz goes elsewhere.

(And you must introduce yourself some time, so I know who the hell I am jousting with.)

F. Kousac said...

cox sounds like a typical republican--no sense of public OR personal responsibility. And a deadbeat who'd rather not pay bills on items he's already run up. It's not about "socialism," it's about RESPONSIBILITY.

But we SHOULD kill all subsidies for farming, banking, and private/religious/voucher schools (you know, the ones that teach ignorance). Cut all subsidies for oil. Cut all funds for military subcontractors.

Institute SINGLE PAYER health care system (something most states want anyway). And PAY THE BILLS bush ran up while creating our national debt debacle (he raised the debt by 5 Trillion dollars).

But no. They'll ruin the economy again by acting like babies and screwing American taxpayers.

Deadbeats.

Oswald Cox said...

Lets sidestep the consummately misinformed girth of Kousac's whiney post with its alarmist fabrications and get back on topic here...

I sound like a typical republican?
Well thats funny because the hollywood studios ACT like typical republicans. You can't have it both ways and criticize individuals who disagree with this state having a ridiculously huge tax burden and then give a pass to hollywood studio who move productions out of town to escape paying their fair share of taxes.

If you don't understand the naked hypocrisy of the situation in this city, then you are so biased that you aren't worth my time. And I'd question the intelligence of anyone who can't call it as it lies either.

The message is simple:

Whoever is for higher taxes, feel free to pay higher taxes. And while you’re at it, don’t shoot your next project in Mississippi or New Mexico or Canada. Stay right here. Stay right in Los Angeles and pay your higher taxes and let the money go right where it belongs.


Thanks for your time.

Celshader said...

Whoever is for higher taxes, feel free to pay higher taxes. And while you’re at it, don’t shoot your next project in Mississippi or New Mexico or Canada. Stay right here. Stay right in Los Angeles and pay your higher taxes and let the money go right where it belongs.

I'm skeptical that the majority of Californians who voted for higher taxes and the few Californians who control Hollywood productions are the exact same people.

Oswald Cox said...

You think?

Last time I checked, the people that make the decisions in Hollywood are huge supporters of Obama, and therefore fans of making the wealthy "pay their fair share", to use the President's own words.

Katzenberg, Clooney, Geffen, Spielberg, Weinstein Eisner et al. have a curious way of practicing what they preach No? (and I'm choosing my wording carefully)

Jeff Robinov of Warner contributed lots of moolah to the Obama campaign at numerous hollywood fundraisers... but moved productions for 'Dark Knight Rises' to the UK and China to escape taxes here in Hollywood.

Spielberg's Super8 had principle production in West Virginia to escape taxes.

JJ Abrams is a HUGE Obama supporter and was at a host of fundraisers... but he shot Mission Impossible
Ghost Protocol in Vancouver to escape taxes.

Disney's Tron Legacy was also shot on Canada to save money on taxes, but Iger supports Obama with all of his heart... except for paying higher taxes...

Shall I go on?


You see paying higher taxes is for everyone but the people with tax attorneys. And the people with tax attorneys are the wealthy studio heads and elite moviemakers and they DON'T PAY the taxes you voted for.

Its nauseating hypocrisy plain and simple.

Celshader said...

Shall I go on?

If you want. You still have not yet made any kind of point.

Steve Hulett said...

Last time I checked, the people that make the decisions in Hollywood are huge supporters of Obama, and therefore fans of making the wealthy "pay their fair share", to use the President's own words.

Katzenberg, Clooney, Geffen, Spielberg, Weinstein Eisner et al. have a curious way of practicing what they preach No? (and I'm choosing my wording carefully)


Oswald, old top: You really have NO idea what taxes the above Hollywood Democrats pay, now do you? (And Weinstein lives in NY, so why you throw him in with California residents is a mystery known but to you.)

And let's not forget that Redstone ( Viacom) and Murdoch (News Corp. Fox), aren't Democrats, so far as I know. But that, of course, undermines the thesis.

You see paying higher taxes is for everyone but the people with tax attorneys. And the people with tax attorneys are the wealthy studio heads and elite moviemakers and they DON'T PAY the taxes you voted for.

Another Coxian assertion unsupported by sourcing or, you know, facts. Again, you really have NO CLUE what taxes these folks pay. You make a claim based on an assumption.

Steve Hulett said...

And another question comes to mind.

How can Hollywood Democrats, who obviously like big government socialism, be hypocrites for making their movies where they can profit from the largesse of big government socialism (i.e. Vancouver, British Columbia)?

I mean, I get how Oswald, being a low-tax, small government kind of guy, might not like it, but Hollywood Dems having their companies collect free socialist money is a looong way from being hypocritical.

Seems to me the model of consistency.

Ah, but Rupert M. and Sumner R. doing it, THAT'S different. They don't believe in that kind of stuff. Except that (guess what?), they do it too.

slacker299 said...

Yeah we don't know what they pay. Just that they move their productions out of state whenever they can, chasing tax credits. The same credits they complain about in more conservative industries.

Its not hurting them, but it is hurting the labor that lives in California. However they vote for it too so sucks to be them.

Oswald Cox said...

Don't get in the way of Steve bending over backwards to defend liberal hollywood elites when they move jobs and important tax revenue out of California.

He's got a whole playbook of inverted logic to provide cover for those kind of practices.

be hypocrites for making their movies where they can profit from the largesse of big government socialism" be hypocrites for making their movies where they can profit from the largesse of big government socialism"

The same way that an animation studio can benefit by moving animation production to India.

You can't be against the latter without being against the former. And once again we return to the them of your posts in here: HYPOCRISY

Steve Hulett said...

be hypocrites for making their movies where they can profit from the largesse of big government socialism" be hypocrites for making their movies where they can profit from the largesse of big government socialism"

The same way that an animation studio can benefit by moving animation production to India.

You can't be against the latter without being against the former. And once again we return to the them of your posts in here: HYPOCRISY


You need to improve your cut-and-paste/ typing skills.

And not to put too fine a point on it, I'm not defending anybody. Or accusing anyone of anything. I'm pointing out what's going on ... by Republican and Democratic moguls alike.

They're standing in line for free money.

You're the one reading hypocrisy into the post. I'm only saying when government(s) hand out subsidies, corporations will be on hand to get their share.

(Oh. And sending work to India? That ain't socialism. That's pure Adam Smith. Citizens on the sub-continent will do the work way cheaper. No free guvmint money involved.)

Every studio with which TAG has a contract outsources work. Every one. It ain't a low-tax/high-tax/socialism thing. It's a business thing.

Oswald Cox said...

I have a new policy of giving you the last word Steve, because this is your blog.

But you realize that Hollywood HAS been given free money by the current administration in the new budget passed to avoid the dreaded fiscal cliff.
And yet... they STILL opt to shoot elsewhere.

In light of that, where does your argument take us? Its not Hollywoods fault until when? Until hollywood is directly funded by our tax dollars? Is that when the excuses stop? Lets call it as it lies:
Its a city of hypocrites who pay lip service to policies of higher taxation for the greater good, but then leave town to cheat this city and state whenever they get the chance.

You have the stage.

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