The real rich - the ones lining the pockets of politicians with campaign donations - are definitely treated different than you and I up in Sacramento.
Consider the $200 million tax giveaway to the motion picture industry whose upper echelon rarely misses an opportunity to lecture us on why the little people - you and I - are self-centered for not wanting to tax ourselves even more to help the less fortunate.
For the past two years Hollywood has enjoyed a $200 million tax credit which is essentially a giveaway of $200 million in tax revenue that could have helped support schools, welfare, and general government.
The California Legislature - the same one as a whole that slams us for not paying enough taxes - has decided to adopt legislation to extend the tax credit through 2017 to give Hollywood types another $200 million pass on taxes. Gov. Jerry Brown has until the end of the month to decide whether to place his John Hancock on it.
Remember, this is the same governor who in 56 days wants us to vote to tax ourselves because the state is short money. Anybody want to take a wild guess at one of the reasons the state could be short funds? Perhaps the words “tax credits for the super rich” might mean something to politicians who idolize movie stars for all of the cash they send their way at campaign time.
We are told the movie production tax credit is essential so California doesn’t lose jobs. Somehow out-of-work actors and production folks who can make more money than a school teacher or a police officer does in one year for just several months of work isn’t likely to conjure up a lot of empathy from those in the middle class and working class trying to find job.
The neutral California Legislative Analyst’s Office doesn’t think the tax credit even makes economic sense. They are underwhelmed by the impact, noting that in the years the tax credit have been in existence it has generated less tax each year than it has generated. Essentially, state taxpayers are subsidizing movie makers because the legislature has decided to make them winners and us losers in the tax game.
That’s not the worst of it. Movie producers need to get into a lottery to secure the tax credits. Amazingly a number of movie production firms that did not secure the tax credit went ahead and filmed in California anyway.
All of the other states that offer tax credits to lure movie production that California lawmakers are so fearful of are finding they’re losing big as well. In Massachusetts the tax credits have cost them three times the amount of taxes a movie production generates.
And let’s not forget the number of big stars that have moved their primary residence outside of California because they don’t want to pay our state’s high income taxes. Since the biggest benefactor in terms of money in movie productions are the stars how can Sacramento justify making them even richer on the collective backs of the general taxpaying public?
And what about the jobs created? If you take the wildly optimistic number of 20,000 jobs created over two years as stated by the Los Angeles County Economic Development Corp. and assume every last one of them was the result of the tax credit, that is a $10,000 tax subsidy per job .That cost per job is really on the low end since the nonpartisan California Legislative Analyst’s Office refutes the job number with data that shows it was significantly smaller.
So what we have is Sacramento using general tax revenue by forsaking it in the form of tax credits to subsidize private sector Hollywood jobs.
How many jobs do you think Sacramento has subsidized via tax credits in a blue collar industry like trucking?
Actually, the better question is how many trucking jobs do you think state regulations are killing in California?
Interesting things to think about before you decide whether to tax yourself even more on Nov. 6 so Sacramento can continue with the financially destructive behavior that has left California hanging off the edge of the abyss.
This column is the opinion of managing editor, Dennis Wyatt, and does not necessarily represent the opinion of The Bulletin or Morris Newspaper Corp. of CA. He can be contacted at firstname.lastname@example.org or 209-249-3519.