Virginia gives Steven Spielberg a dose of corporate welfare

I usually get all sorts of emails from Gov. McDonnell’s office announcing this program, that event or sometimes they contain pictures, suitable for framing. One release I didn’t get, but the rest of the world did, was the announcement that movie maker Steven Spielberg has chosen to set his new flick, “Lincoln” in Richmond and Petersburg.

Now that makes sense. Lincoln did visit Richmond toward the end of the Civil War, roughly at the time the Petersburg siege was coming to a close. But sensible or not, that didn’t stop Spielberg from asking for a little state aid in getting the picture off the ground – an ensuring it would be filmed in the place here the action actually occurred.

Virginia’s political class was only too happy to oblige.

Spielberg will receive $1 million from the Governor’s Motion Picture Opportunity Fund and an additional $2.5 million from the Virginia Motion Picture Tax Credit program. But because catering trucks and security don’t come cheap, the state is also tossing in $1.1 million worth of in-kind contributions.

So congratulations, Virginia taxpayers, you’re on the hook for about $4.6 million in support of a film produced by a Hollywood billionaire. Just don’t expect to get a thank you note, invitation to the premiere, or even a discounted movie ticket in exchange for your generosity.

And don’t expect a good return on your money, either. As the Tax Foundation’s study on the matter notes:

Based on fanciful estimates of economic activity and tax revenue, states are investing in movie production projects with small returns and taking unnecessary risks with taxpayer dollars. In return, they attract mostly temporary jobs that are often transplanted from other states. States claim to boost job training with MPIs, but these tax incentives often encourage individuals to gain skills that are only employable as long as politicians enact ever larger subsidies for the film industry. Furthermore, the competition among states transfers a large portion of potential gains to the movie industry, not to local businesses or state coffers. It is unlikely that movie production incentives generate wealth in the long run. Most fail even in the short run. Yet they remain popular.

“Yet they remain popular.” Despite the fact that such subsides may do much more harm to local economies than good.

But studies on the economic impact of film subsidies just can’t compete with politicians who have stars in their eyes and a yen to attend a real, live Hollywood premier, as they did back in 2008 when the HBO mini-series “John Adams” debuted at Richmond’s Byrd Theater.

And yes, Virginia wrote Tom Hanks some handsome checks for that production, too.

(Cross-posted at Score Radio Network)

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About the author

Norman Leahy

Norm Leahy has written about Virginia and national politics online since 2002, beginning with One Man's Trash (OMT), and continuing through Bacon's Rebellion (both the blog and the e-zine), Sic Semper Tyrannis, NBC12's Decision Virginia, Richmond.com and Tertium Quids. He is the chief blogger at "The Score" and a producer of "The Score" radio show as well as being a Washington Examiner contributor.