This week brought another report underscoring the fecklessness of Louisiana’s generous subsidies for the motion picture industry. LSU economist Loren Scott weighed in with a report saying that for every dollar Louisiana’s taxpayers give away to Hollywood, the state receives between 18 and 24 cents in tax revenue. Even for government, that’s towering inefficiency.
But another piece of news that hasn’t gotten as much attention is the move by Michigan’s House of Representatives to get out of the movie subsidy business.
Michigan, which has an economy roughly twice as big as Louisiana, has spent $500 million since 2008 luring filmmakers. By contrast, Louisiana has spent nearly that much in the past two years.
Louisiana’s program is uncapped, which means that a state facing a $1.6 billion shortfall has no control over how much it will have to spend on money-losing subsidies to actors and investors who, for the most part, do not live here.
The Jindal administration, which is proposing reforms to other giveaway programs, has offered no plan to trim the costs of the film giveaways.
State Sen. J.P. Morrell, D-New Orleans, and Rep. Julie Stokes, R-Kenner, have stepped into the void with legislation that makes several needed reforms. They propose for the first time to cap spending, but their plan to limit the cost to $300 million a year would allow the program to grow at a time when the state should be looking to curtail it.