More Money for Millionaires

by James A. Bacon

Here’s one way to look at it: If the commonwealth is going to shower millions of dollars in tax credits and grants to multimillionaires for making movies in Virginia, it might as well give it to Virginia multimillionaires. At least that keeps the money in the state!

According to the Times-Dispatch, the state gave a $200,000 grant and an $800,000 tax credit to the production company that filmed “Field of Lost Shoes” about the Civil War battle of New Market in which VMI cadets helped defeat a Union army. The company is owned by Thomas Farrell II, CEO of Dominion Resources, who co-wrote, invested in and raised money for the movie. Farrell’s son, Peter Farrell, a Henrico County delegate to the General Assembly, also was an investor, co-producer and actor in the movie.

If the state is going to shell out that kind of money to lure film production to Virginia — the independent film company spent nearly $4 million in “qualified expenses” on the project — why give it all away to the likes of multibillionaire Steven Spielberg, who filmed “Lincoln” in the Old Dominion? Share the wealth, baby!

Of course, I’m being totally facetious. The state has no business subsidizing film production for anyone — Virginian or non-Virginian; millionaire, billionaire or pauper — any more than it has subsidizing painters, fiction writers, graphic novelists, musicians, bloggers or any other artist.  Welfare (or incentives, whatever you want to call it) for millionaires is not justifiable in anybody’s moral framework.

The point of the film tax program is to encourage economic activity — film production — in Virginia that wouldn’t take place here otherwise. Did giving Farrell’s production company $1 million induce him to film in Virginia as opposed to somewhere else? Where else was Farrell, a University of Virginia grad, going to film a movie about VMI and a battle fought in the Shenandoah Valley? Kentucky? Southern California?

This is one more instance of Virginia’s political class picking the pockets of taxpayers and redistributing it to the wealthy and politically connected. Republicans, who increased this particular subsidy under the McDonnell administration, are blocking the expansion of Medicaid on the grounds that we can’t afford it (which we can’t). But they’re OK with subsidizing a millionaire’s personal artistic passion? Shame! Shame!

While I deplore the tax breaks, I have to say, the movie trailer looks pretty good. The Farrells lined up some serious B-List talent — Jason Isaacs, Tom Skerritt, David Arquette — and the acting and production values come across as very professional. I hope the movie is a financial success. If it is, maybe Tom Farrell will film more stories from Virginia history… without the benefit of tax breaks.

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22 responses to “More Money for Millionaires”

  1. LifeOnTheFallLine Avatar

    We’ve had our disagreements on this blog and I think it’s been mostly civil. I try not to let my passions get too inflamed when it comes to Internet disagreements.

    But as God as my witness, if you ever refer to Tom ‘Viper’ Skerritt as a merely B-list actor ever again I will physically fight you James Bacon.

  2. People like LarryG just can’t understand why the people in NoVa don’t trust the General Assembly enough to raise taxes on ourselves in the hope of fair treatment from the political class in Richmond.

    This is why.

    The CEO of Dominion has a hobby. His company is the biggest corporate donor to Virginia politicians. In 46 other states this would be either forbidden or heavily restricted. Virginia is one of only 4 “free for all” campaign contribution states. So, the political class is beholden to Dominion whose CEO fancies himself an artiste. Meanwhile, that CEO is a high school buddy of the former governor – Bob McDonnell and the CEO’s son is a Republican General Assembly member from Henrico County.

    Voila! A million dollar tax break to film a movie that sounds like it’s pretty much entirely based in Virginia anyway.

    Maybe the state ethics committee should look at how all this happened. Oh, right! We don’t have an ethics committee. The Republican speaker of the House of Delegates didn’t really see any need for one in a state that is governed by “The Virginia Way”.

    Two things stand out:

    1. Our state government is a disgrace. Open cronyism is simply “business as usual”. We are a mid to high tax state with a very low level of benefits (see: Medicaid in Virginia, support for state universities). Where does all the tax money go? Well, it makes up for the profligate tax break handouts given by the General Assembly to friends and family in return for everything from campaign contributions to Rolex watches.

    2. The Republicans in the state government are far more to blame for the sorry condition of our political environment than the Democrats. It is the Republicans who consistently defeat common sense ethics rules, it is the Republicans who seem to predominately benefit from the gifts, it is the former Republican governor who is awaiting his trip to prison.

    If the Republicans in Virginia can’t clean up their act then we need to turn the Old Dominion into a very, very blue state. While I consider myself generally conservative I’d rather deal with an honest liberal than a dishonest conservative.

  3. Cville Resident Avatar
    Cville Resident

    You will never get true political reform with today’s Republican Party. And very unlikely to ever see it from the D’s.

    But in my years on this Earth, I’ve become convinced of one thing: MONEY TALKS.

    You will never receive good, honest, competent government until there is 100% public financing of elections. No private money anywhere in the process.

    You will never have such a no private money policy with today’s GOP (and probably not the Dems either if the truth is told).

    We see it year after year after year in all 50 states and the federal level…money talks and big money finds a way to get governments to do its bidding. This film lunacy should surprise no one.

    I have a libertarian friend who reminds me of Mr. Bacon. Bright guy who rails against this type of corruption all the time. Yet, he can never, ever, ever tell me how you get to good gov’t without 100% public financing of elections. That’s why I have such a hard time taking libertarians/right wingers too seriously….they know that money in the political system is by far the biggest problem. And yet, they have zero solutions and simply say “money is speech.” How can you watch our state and republic go down the drain, know the problem, and just say, “Oh well, First Amendment, can’t do anything, blah, blah”?

    What’s the problem with a Constitutional Amendment to ban private money from the political system?

    1. I don’t like the current system in which money talks. But let me ask you about a publicly funded system. Who calls the shots about who gets campaign money? How much money would you have allocated to the recent U.S. Senatorial election, and how would you have distributed the funds between Warner, Gillespie and Sarvis?

      1. Cville Resident Avatar
        Cville Resident

        Fair question.

        Unlike others, I would have a set pot of money ($10 million let’s say) and distribute it evenly among all candidates who qualify for the ballot. May the best man or woman with the best ideas win.

        I really don’t care at all about the 2 major parties and think this type of system could inject some needed diversity of ideas into politics (maybe even an independent Baconian ha ha!).

        I don’t mean to come off as a grump, but the money that pours into our democracy for “favors” on both sides is just sickening.

        1. I’d love for Sarvis to get 33% of the pie. But the two dominant parties will never let that happen. They will never relinquish their duopoly. Can you think of a scheme that has an iceberg’s chance in hell of ever getting approved? And what do we do with *really* marginal candidates (1 tenth of one percent)?

          1. Cville Resident Avatar
            Cville Resident

            No doubt that as long as the voters themselves don’t demand it, you can be sure the duopoly will maintain the current system.

            As to marginal candidates….why not raise the bar for ballot qualification? Maybe require 2500 signatures per congressional district to make the statewide ballot?

            I guess my biggest complaint about complainers is this: Democracy isn’t easy. And that’s a good column for you to write about on this site. We’ve truly come to the point that we think the simple act of “voting” is all that is required to participate. So long as that is the attitude, you can be sure the duopoly will endure. We never teach engagement or organizing as part of democracy.

            What’s saddest of all is how our society mocks those who do. Whether it’s the “hype man” who I’ve seen in Cville the past 2 years trying his best to get a crowd for Sarvis or the anti-pipeline organizers in Western VA in Montgomery, Augusta, and Nelson Counties….people almost view that as “strange.” Organizing, speaking out, etc. isn’t viewed as part of democratic citizenship, it’s viewed as a “freak show.” Now who benefits the most from discouraging true democratic participation? You guessed it….the political establishment.

          2. a couple of observations to add to the stew:

            1. – the two political parties are the political version of Dominion and Appalachian Power in that they own the process and they are not about to allow 3rd parties to meaningfully participate in head-to-head challenges.

            2. – the Tea Party of all groups – you’d think this would be their number one priority to repeatedly challenge the things that enshrine the duopoly – instead of blathering about impeachment and shutting down govt.

            but it’s not like they are not making inroads – Mr.. Cantor found that out.

            3. – I’m not sure Americans would like a Congress that works like some Parliaments but I’d bet a significant presence in Congress not associated with either party – that could influence legislation – might lead to even more gridlock – not less..

    2. I am not so sure about Republican vs Democratic overall. However, Virginia has its own issues.

      “Just four states – Missouri, Oregon, Utah and Virginia – place no limits on contributions at all.”

      Fifth most gerrymandered state, hardest state for an independent to get on the ballot, one of two states holding off-year legislative elections, one of four states with no campaign contribution limits, only state where legislature directly elects judiciary without merit board or any outside consultation, one of only nine states with no statewide ethics commission.

      Are you starting to get the picture?

      The state motto should not be “Virginia is for lovers” it should be “Virginia is corrupt by design”.

      Virginia has had 7 completely different state constitutions over its history (the latest adopted in 1972). It’s time for number 8.

      The only way we’re going to make progress in Virginia is for the voters to use a new state constitution as a scalpel to neuter the General Assembly. Metaphorically speaking, of course.

      1. TooManyTaxes Avatar

        “Virginia is corrupt by design”. I like that. Add to your list the massive transfer of wealth from Dulles Toll Road drivers to some very rich and powerful landowners at Tysons. Also, consider the impact on quality of life by residents who see their neighborhood streets being used by commuters trying to avoid the higher DTR tolls. All things considered, I still think I made the right decision moving to Virginia 30 years ago. Given the choice between D.C., Maryland and Virginia, I’d chose the same today.

  4. re: ” I’d rather deal with an honest liberal than a dishonest conservative.”

    WOW! Common Ground!

    on the tab breaks – keep in mind that many Virginians get at least one that they don’t even know about and that for those lucky enough to have it, is their health insurance is not taxed. I wonder if any has calculated this at the state level. At the Federal level, it’s by far the biggest tax break and it amounts to more than 250 billion – half our current deficit.

    but just think what would happen if Virginia decide to give back the taxes it takes on individual purchased health insurance – which would then be a level playing field for both middle and lower class but it would put Virginia even in a deeper deficit hole.

  5. Steve Haner Avatar
    Steve Haner

    Larry. You obviously missed the memo but didn’t you see the Grubergate Videothon on Fox? There IS now a tax on employer-provided insurance coverage. Part of the ACA. It is starting on so-called “Cadillac” plans but Gruber kindly clued-in us stupid American voters by explaining the inflation factor on the tax is lower than the inflation expected for health coverage, so eventually more and more of the employer plans will be taxed. The tax will be imposed on the insurance company, and merely passed on to the customer, who of course is well known to be too dumb to figure out what happened. Right Larry?

    Actually, it was in that passage that Gruber indicated that he understands one thing that most don’t — businesses don’t pay taxes, people do. Impose a tax on insurance companies or employer-paid coverage and it will be paid by the insured, one way or another.

    There was a piece in the TD or the WSJ last week about how this provision of ACA is already a main driver behind all the increases in deductibles and co-pays, as employers try to drive down their premium costs and shift the burden to the employee. So quit worrying, Larry, you got what you want!

    1. TooManyTaxes Avatar

      “Bronco Baman” just told the public Gruber wasn’t really involved. And why would anyone doubt the veracity of the President on the ACA? It’s not like he’s lied to the American public in his attempt to get his face carved on Mount Rushmore.

      Mark Warner is probably very happy that GruberGate broke after election day.

      1. Gruber was Mitt Romney’s advisor also.. right

        Gruber was dumb to say what he did – but it was the unvarnished, awful truth. The average American has no clue how health insurance works.

        but here – here’s a gift for you guys:

        and tell me why justifies making health insurance tax free for SOME people but not all? what’s the justification for that inequity?

        1. TooManyTaxes Avatar

          Larry, what do you think would happen in the next election to any elected official who voted to make 100% of the value of employer-provided health insurance taxable? Remember Rostenkowski? Look at the labor unions, strong supporters of the ACA, when they see many of their negotiated plans will be taxed. As I’ve said many times, there is no interest among the American people to make any significant sacrifice to expand access to health insurance. In order to expand coverage to people without it, others must sacrifice.

          Obama must have known this. That’s why he lied over and over and over again. If he tried this outside the White House, the FTC would be prosecuting him.

          1. re: ” what do you think would happen in the next election to any elected official who voted to make 100% of the value of employer-provided health insurance taxable?”

            so you’re justifying a totally inequitable system that literally picks winners and losers because opponents of ObamaCare fear telling the truth about all health insurance?

            The folks who have employer-provided tax free insurance oppose similar tax credits for those who “don’t deserve it” ?

            My problem here is not that I think ObamaCare is sliced bread or anything close to it but it IS – VERY SIMILAR to employer-provided in that the “subsidies” for tax credits are no different than how we subsidize employer-provided except we don’t even have to report it as income on the 1040.

            why do the people on employer-provided deserve govt rules that require insurance companies not to deny pre-existing conditions and to not charge individuals according to their own individual risk – and people who do not have employer-provided do not deserve the same rules?

            We have obvious disparities and inequities in the way we do health care but the folks who have employer-provided could not care less as long as you don’t touch their entitlement… right?

          2. TooManyTaxes Avatar

            Larry, I stand by my comments. There is no evidence the American public is willing to make any significant sacrifice to expand access to health insurance. In principle, many would say “yes, expand it.” But ask them what they are personally willing to pay or give up to achieve that goal and the answer is “darn little, if anything.” And there aren’t enough rich people to fund the program. Clearly, you don’t like my argument. I respect that. But I’m still right.

            If, Tim Kaine, for example, went on a binge to remove the tax exemption for all employer-paid insurance, including that of federal, state and local government employees, along with union members, do you think he’d be reelected – assuming he runs again?

            Personally, I think virtually all Virginia politicians are too smart to touch this third rail.

          3. ” Larry, I stand by my comments. There is no evidence the American public is willing to make any significant sacrifice to expand access to health insurance.”

            even to give others the same rights they have – right?

            ” In principle, many would say “yes, expand it.” But ask them what they are personally willing to pay or give up to achieve that goal and the answer is “darn little, if anything.” And there aren’t enough rich people to fund the program. Clearly, you don’t like my argument. I respect that. But I’m still right.”

            Oh I think you are right but people who have something that they’d deny others the same access to – are wrong. You’re right about what they think.

            But they get tax credits and protection from insurance companies – and they’d deny that same entitlement to others.

            “If, Tim Kaine, for example, went on a binge to remove the tax exemption for all employer-paid insurance, including that of federal, state and local government employees, along with union members, do you think he’d be reelected – assuming he runs again?”

            You’re right. If the Republicans said they want everyone to have the same equitable benefit – which would required – 1. give the same to everyone or 2. taking it away from everyone… so in the end – everyone has the same rights..

            “Personally, I think virtually all Virginia politicians are too smart to touch this third rail.”

            Oh I agree but it’s perverse. The folks who work full time and do not have access to employer-provide – are paying taxes that provide subsidies to the who have employer-provided .. and the folks who have employer-provided – either

            1. – don’t have a clue that they’re getting preferential treatment


            2. – they do but they do not care.

            Every person should have access to the same tax preferences and rules for insurance.

            there is no magic in employer-provided. It’s not something the companies do. The folks who work there don’t do anything different to enjoy access to it except work where it is provided.

            the magic in employer-provided – is the government – not the private sector.

            no govt tax credits and rules for pre-existing and no employer-provided health insurance.

            Mitt Romney and other GOP including the Heritage organization have all said that this is not an equitable approach to health care.

            and it’s not – because the folks who get employer-provided – are paying for those who do not have it via cost-shifting and charity care.

            It’s more than ER use. the uninsured may well stay away from the ER – until it’s too late and they have an advanced disease – but it’s not the ER that treats them at that point – it’s the hospital – and the hospital has to get the money to treat them from somewhere.. where do they get the money? Last I heard , none of the hospitals kick a terminally ill patient back out on the streets – so someone is paying for them… and so it’s no surprise at all that we pay twice as much for health care as other countries – basically because we wait until those on charity care get terminally ill from a lack of primary care .. and THEN we’ll all pay to treat them – to spend thousands to keep them alive a few more days or weeks.

            we have a really dumb system that is supported in large part by a majority of people who don’t really understand even their own health insurance but could care less about others as long as they have it.

            so you’re right – not Tim Kaine – not Bob McDonnell – not Ken Cucinelli – not Bill Howell – will be honest enough to address the real issues .. because as soon as they did – they’d be accused of calling people with employer-provided health care – “ignorant”..

            let me finish off here saying I’m NOT in favor of GIVING entitlements to people who do not deserve them unless we do it for everyone equally.

            I’m not opposed to employer-provided.

            I’m not in favor of ObamaCare per se – only any approach that would provide some level of equitable access to those who don’t enjoy the same entitlements.

            What I’m in favor of is the truth to be told to folks who currently benefit from govt tax subsidies and rules for pre-existing – tell them the truth.

            and then let them think on it… for a bit – then ask them what we should do.

    2. Steve – do you think you understand your own healthcare ?

      be truthful. Do you understand the law(s) that apply to your health insurance?

      tell me what makes insurance companies for employer provide insurance have to take subscribers with pre-existing conditions and not charge them any more than other subscribers?

      Do you know?

      do you think employers would offer health insurance if the insurance companies could deny pre-existing conditions and charge each subscriber a different cost?

      Keep in mind that Gruber and Romney both agreed on this issue about how the govt influences health insurance and how the average person has no clue of the provisions.. not for ObamaCare not for Employer-provided.

      How come people with employer-provided get it without paying Fed and State taxes nor FICA while the poor schmuck that buys in the market – has to used taxed money?

      do you know the reasons?

      why do those with employer-provided deserve tax breaks and those without do not?

  6. Peter Galuszka Avatar
    Peter Galuszka

    I worked hundreds of hours on this blog. Why don’t you pay me you dork!

    1. TooManyTaxes Avatar

      Bacon is trying to persuade Loudoun County to name one of the Silver Line stations after you. If that fails, he’s going to try to get one of the Express Lanes on 95 named after you. What more could one want? 😉

  7. for those on the verge of unrequited excitement over “Gruber” – you might want to read this:

    Romney defends Mass. health care law


    ” “Basically, it’s the same thing,’’ said Jonathan Gruber, an MIT economist who advised the Romney and Obama administrations on their health insurance programs. A national health overhaul would not have happened if Mitt Romney had not made “the decision in 2005 to go for it. He is in many ways the intellectual father of national health reform.’’

    Gruber is correct but it was impolitic to utter the truth.

    The average American has no idea how health care works – even before ObamaCare. They are largely clueless as to the laws and policies that enable employer-provided insurance – which only exists at all because of Govt subsidies. Without those subsidies, employer-provided health care would disappear.

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