- Time to Say Hasta La Vista Baby
Pretty much every state in the union subsidizes the film business and Wyoming is no exception. According to the leftish Center on Budget and Policy Priorities, 43 states spent $1.5 billion on film subsidies in 2010. This is money that could have been used to build roads, reform the education system or better yet, left in the pockets of the people who earned it. Film company executives must be laughing all the way to the bank as states compete with each other to offer the biggest handout in this folly of corporate welfare.
Back in 2007 the Wyoming legislature said yes we can to film subsidies. Since then, the Film Industry Financial Incentive Program has handed out $864,142 to private businesses. The Wyoming Film Office estimates its handouts resulted in about $4 million in expenditures in Wyoming for the purchase of goods and services associated with film production. Although on the surface this may look like a good deal, no one seems to have asked, would these projects have happened anyway? In reality, film subsidies are nothing more than corporate welfare.
Corporate welfare includes programs providing grants and aid payments, equity investments, and loan and loan guarantees where a direct financial benefit goes to an individual company. These subsidies not only force taxpayers to fund private businesses they might have otherwise chosen not to, they give some firms an unfair advantage over others, possibly keeping failed businesses afloat. This makes it difficult for good businesses to operate, as they are forced to compete against taxpayer-funded operations that may spend more money and time extracting taxpayer dollars from governments than providing goods and services to consumers.
Given the need for a budget cut, corporate welfare would be a good place to start. In the 2013-14 budget, Film Wyoming has an appropriation of $900,000 from a general fund (which, incidentally, is not subject to the 8% budget cut) to hand out to private businesses. Cutting this handout program would potentially save Wyoming taxpayers $900,000 per year in subsidies to business, not to mention the cost to manage the program. This cost is absorbed by the Wyoming Tourism Board and includes: staff salaries and benefits, out-of-state travel, advertising, sweepstakes promotion, the development of a trade show booth and touring film professionals around the state.
Governments have yet to come up with a spending program more wasteful than corporate welfare. Governments are not good at picking winners, but losers are very good at picking governments. This creates waste, higher taxes and higher debt. It is unlikely Wyoming could win the film subsidy war so the best thing the legislature could do is eliminate this corporate welfare program.