The Slashing: who it helps and who it hurts

There are so many things wrong with a recent analysis of the film tax credit cut (henceforth referred to as “the Slashing”) on New Start Nova Scotia, a website that says it is a platform for public policy advocacy, that it’s hard to know where to start.

“Current events can have a way of intervening,” writes the author, Bill Black, apparently referring to how the massive protests against the Slashing have disrupted the government’s plan to gut the film industry, fire thousands of workers, chase production companies the hell out of our province, and save us all lots of money.

Black goes on:

“In 2013-2014 the industry paid $40 million in qualifying wages to Nova Scotians, for which the province paid incentives of $26.4 million (about two and a half times the grants to all other artists and arts organizations). Over a decade that would be $400 million in wages and $264 million in subsidy, about the same as the hugely unpopular handout to Irving for the shipbuilding contract.“

Nice try, Bill. Comparing the film industry to the sweetheart deal Irving got from the province was pretty clever.

But there is no comparison. For starters, the film industry has actually produced jobs–over 2,500 of them each year, for the past 20 years. And that’s just the people who are directly employed. There are plenty of sideline jobs and cottage industries that spring up around any bigger industry. And it doesn’t take into account any of the people who depend on these 2,500+ earners, either. Considering that many of them have spouses and children, the number of people dependent on the film industry for their survival is certainly much higher.

The Irving deal, in the meantime, hasn’t actually produced any jobs yet, though Irving said in January that it plans to start rehiring laid-off employees in the fall.

How many jobs are going to be created by this shipbuilding boom? In the same article linked above, the CBC says:

“Irving Shipbuilding said employment for the Arctic offshore patrol ship project will reach 1,000 during the peak of construction. Another 600 to 800 workers will be employed on other projects, the company said.”

So that’s a maximum of 1,800 workers who will be employed in what is by its very nature a temporary industry. This is quite a tumble from the 4,000 jobs that were predicted in 2013. And the film industry wasn’t going anywhere. Those 2,500 jobs were here to stay.

Bill Black goes on:

“By way of comparison the oft-cited Royal Bank deal will cost $22 million over ten years for $200 million in wages. And at the end of ten years there would be a reasonable prospect, though not a certainty, of the 500 jobs continuing without further subsidy. If a twin deal was done with another bank the two would match the $400 million of wages by the film industry, for $220 million less in subsidy.”

OK, well, that does sound like fiscal responsibility. Except that Black is using some very optimistic numbers. In the Financial Post, we learn: “The bank is expected to create 150 new jobs this year in cheque processing, accounts payable and fixed asset accounting.” So that number of 500 is based on… what? Wishful thinking? Let’s work with what we know to be true: 150 people are being subsidized to the tune of $22 million over 10 years. That works out to a subsidy of just under $15,000.00 per person.

The film subsidy worked out to a little over $10,000.00 per person. So is this fiscal responsibility? Nope. I don’t know what it is, but it’s not that.

Nova Scotia Business Inc. also said, “The average salary in the payroll agreement is about $60,000 annually.” Maybe I’m just a cynic, but let’s think about what this might really mean. We know at this point that the people at the very top of the business and banking pyramids make exorbitant amounts of money, while the people who do the actual work make somewhere in the region of $15 an hour. (I know that some tellers make less than that at the Bank of Montreal in my town.) Don’t trust averages to tell the truth about anything. On average, everyone in the world has half a penis and one breast.

I’m in favor of fiscal responsibility, but I’m also in favor of helping out families. And I’m in favor of transparency, by which I really mean honesty. When you have to use fuzzy math and bad logic to confuse your opponents, you’re engaging in intellectual dishonesty.

Who is the Slashing really benefiting? When in doubt… follow the money. The people who received most of the benefits from the tax credit were not wealthy people. They weren’t movie stars. They were extras, caterers, costume designers, casting agents, and many others. In other words, they were making a lower-end middle-class income. Like most of the people in this province, they were just trying to get by the best they could.

And things just got a lot harder for all of them.