There is so much controversy about the Michigan Film Incentives and I read so much disinformation about them and the Industry, mostly by people with an agenda or who have no experience or understanding of how the film industry actually works. I have always loved the movies. I majored in Film, Radio and TV a long time ago at Wayne State University and I lived in California for 20 years and in LA for 4 years where as a caterer I was very involved in the Film Industry. Most of the critiques I hear demonstrate a misunderstanding of that industry that seems to come from trying to compare it to industries more familiar. Say for example, manufacturing, something we know a little bit about here in Detroit. Never mind that manufacturing, the industrial revolution and the whole corporate system is over, bankrupt and in its last gasps dying phase. Look around at the world, folks. The industrial revolution is over. China won. The third world won. All the places where people’s time can still be bought for pennies on the hours will always win in a game thats about trading hours for dollars and doing work that in repetitive and mindless. And for all of you who still think there are American cars and Foreign cars, wake up! Ford, Gm, Honda, Mercedes Benz and Toyota are all global companies who make and sell everywhere. If you want to make good money for your hours you better be doing something creative. America used to be pretty good at that. Being creative. The movie industry is one of the places where we still dominate with our creativity. Other countries are moving up fast but so far we still lead. And in the process we export our culture, our values and our freedoms throughout the world.
The movie industry is the perfect industry. Everyone is relatively well paid. They are self-employed and the do not work as many days a year as most other jobs. They are creative and in a team sport, which fosters collaboration and excellence. And the movie making process utilizes pretty much everything else around. The trickle down effect is huge as a motion picture crew uses local suppliers, talents and services. It is diversified. I used to be in financial services. Any astute investors know one of the strongest ways to dillute risk is diversification. We haven’t had much of that in Michigan and look where its gotten us.
My friend Stan Williams Says it well in a post he authored today. I am going to paste it here for your pleasure.
Posted by: “SDW @ SpamArrest” sdw@stanwilliams.com stanwilliamsphd
Mon Feb 28, 2011 6:51 am (PST)
The answer to: “Why not have a 42% incentive for all businesses?” is
very simple. There are three (3) tangible characteristics, and two (2)
powerful intangible characteristics, to the MI Film Incentives that
most other businesses don’t have. If they do have these
characteristics then perhaps they should get a similar incentive.
TANGIBLE FILM INCENTIVE CHARACTERISTICS
(1) Film Incentives attract cash that was previously OUTSIDE the local
economy.
(2) The cash is spent QUICKLY
(3) THE CASH is spent DIVERSELY (both geographically and in different
industries or disciplines) .
Those three tangible characteristics immediately begin to generate tax
revenue through the dozens of tax channels the state has on the books
(see turbine.pdf diagram). The more NEW cash in the engine, the more
NEW taxes are generated as the money spent over and over.
The tax turbine diagram here: http://www.stanwill iams.com/ turbine.pdf.
With 18 months, BEFORE the state writes the incentive check, the money
likely changes hands a dozen times. And each time it changes hands
it’s taxed in one way or another. That the state gets back every time
in some form of tax revenue, from the dozens of taxes on the books,
cannot be proven. But the Ernst and Young reports points to the
eventuality, even if it takes another 18 months.
The model is that the money is generally NEW cash that was not in the
MI spend cycle BEFORE producers brought it in from investors. This
even works if the investor is from MI, because money spent on movies
is NOT being actively cycled or taxed until the hundreds of people in
the first and second spend-tier start spending it.
The POWERFUL INTANGIBLE FILM INCENTIVE CHARACTERISTICS
(4) The END PRODUCT. Narrative motion pictures are the most powerful
public relations device know to the history of mankind. A film Made in
Michigan promotes MI through it’s images and sounds on screen seen
around the world for decades afterwards. Made in Michigan movies (by
their very presence in culture) promote not just tourism but also
promote residency and business relocations. Any business or
organization (when it has the money) will turn to motion pictures to
promote its ideas or products. The reason film is so powerful has a
great deal to do with the characteristics of story and how ONLY
STORIES are effective in passing down values from one generation to
the next. As evidence of that see the three essays beginning here: http://moralpremise .blogspot. com/2008/ 09/why-are- stories-necessar y.html
(5) The ON-GOING PROCESS. Imbued in the storytelling is the
collaboration of every discipline known to man. Motion picture
development, production and distribution requires a friendly,
encouraging business climate. It demands hour-by-hour innovation,
through work-diversity, teamwork, art, music and a thousand other
disciplines. Movie production pulls together EVERY aspect of human
endeavor like no other industry in the history of mankind. Money
cannot buy the positive, life-fulfilling, motivation that the process
of creating a motion picture generates. The creative, intelligence,
and innovative leadership that made California (with all it’s at-times
weirdness) the cultural leader of the country, and why Silicon Valley
is in CA, along with Facebook, and GATEWAY COMPUTERS (Hint! Hint!
Wink! Wink!), is the result of the synergy created by the confluence
of energized entrepreneurial mind-sets that are fostered through the
motion picture industry. Like no other industry the film business
pulls together EVERY conceivable discipline known to man and gets
those diverse people to work together toward a common good, and in a
quick manner. One of Tom Peter’s rules to successful business is to
PROTOTYPE QUICKLY. That is exactly what the movie business does. Every
movie is a prototype. Nearly everyone involved in the production is an
independent entrepreneur, working toward a common, innovative (never-
been-done-before) goal. That brain power and initiative required for
motion picture production carries over into every aspect of life
outside the movie set, studio, or edit salon. And it raises-up the
cultural and social fabric of EVERYTHING else in the community. Money
can’t buy that. But it comes naturally wherever movies are made. And
that’s why GATEWAY moved form South Dakota to Irvine, CA. It wasn’t
low taxes.
Question for Nancy Cassis and the small minds (at the Mackinaw Center)
that want to count “employees” as opposed to “independent
entrepreneurs” : Which would you rather have as the basis for your
economy: a bunch of employees that work 9-5 for someone else? Or A
bunch of independent contractors that work 6 AM to 10 PM for
themselves and with others toward an innovative and inspiring outcome?
One mind set creates a labor intensive, assembly-line mentality. The
other creates unstoppable innovation, new jobs, and unparalleled
prosperity.
Just remember, Gateway moved to California, just 46 miles from
Hollywood.
Stan Williams
Michigan Producer
Ed Gardiner
