Alex Strachan ALMOST Gets It Right

WRITING IN TODAY'S Vancouver Sun, Alex Strachan has a clear-headed argument about C10:

Bill C-10 is bad economics for publicly funded films, TV

There are arguments, and then there are silly arguments. It's funny how the silly arguments almost always come at taxpayers' expense.

The flap over Bill C-10 -- a government proposal to amend the Income Tax Act so that tax credits will be clawed back from those homegrown TV and film productions the government judges to be offensive -- is a classic example of what happens when the misinformed meet the misguided.

Bill C-10 is bad public policy masquerading as tax policy.

Strachan then goes on to posit a theory that I hadn't heard before, but which sounds like it could be plausible: that these provisions had their genesis in the once-upon-a-time flap over the making of a movie about Canadian serial killers Karla Holmolka and Paul Bernardo. When the Conservatives say that the policy was inherited from a previous Liberal Government, they're partially correct.

(They have juked the language to vest all the power in the Heritage Minister, and that is a change, but that's small beer.)

Where Strachan goes off the rails -- and it's only a little bit, is when he recounts the hysteria on both sides -- those like Charles McVety who want to deny tax credits to anything they think is dirty, and the cultural community who posit that it amounts to pre-censorship.

There's a tendency in journalism to take two contentious sides and ascribe a moral equivalency to the two of them. The formula goes like this: "So and so believe this; and So and so that, but they're both wrong, the point is this..."

The problem with doing that in this case, again, and dismissing the claims of censorship as false, is that it denies the real way this would be administered:

Film and TV Producers borrow money to finance films. These completion loans are repaid with interest to the banks once the tax credits come through -- at the very end of the process.

So you could borrow the money, and then have your tax credits denied.

No bank will lend you money for anything that might even POSSIBLY exceed the standards, ergo, you self-censor. The nice thing about it is the government doesn't have to act heavy handed -- after a while, the chill just stops "bad stuff" getting made. And believe you me, the line will get drawn by the banks far, far east of Eastern Promises -- just as, ever since the fining over Janet Jackson's wardrobe malfunction, when FCC starting handing out fines for obscenity, the lines are far, far, more conservative than they were in the 90's. And this in the USA, the land of "free speech."

Today's censorship dresses up in finer robes. It doesn't have to be a coarse, blunt instrument -- only a whisper in the ear of a worried banker or producer.

Fortunately, judging by the exchanges yesterday, there are members of the Senate banking committee who are clearer on this line than Strachan.

Strachan continues:

Public funding of film and TV projects is decided by agencies like Telefilm and the Canadian Television Fund long before a TV or film makes it on to the screen. Proposed projects have to jump through a dizzying number of hoops to get made, and can be derailed -- or stopped outright -- at any stage of the process. Any proposal featuring a gratuitous amount of sex, violence or other offensive material -- whatever "offensive" means -- is already at a distinct disadvantage when a fund manager at, say, the CTF has to decide between a degrading exploitation flick and a feel-good family comedy.

Public funding is not the same as a tax credit, though. There's a difference between public funding, as represented by Telefilm, and tax credits, which are waivers on taxes due.

Economic decisions are just that -- economic. As a general industry rule, one dollar spent on TV and film production generates four dollars in economic activity.

The only issue, then, facing a government banking committee should be to figure out how to generate more economic activity, not less.

Bill C-10 is an unnecessary, misguided, wrongheaded and shortsighted piece of legislation. Not because it's censorship disguised as tax policy, which it may well be and which cultural critics insist it is, but because it's bad economic policy.

If somebody somewhere wants to make a film about Karla Homolka, fine, I don't have to see it. I certainly wouldn't pay to see it.

But if that same somebody is going to hire 200 actors, cameramen, electricians, carpenters, caterers, drivers and any number of other trades people, and pay them a decent wage -- a wage which will then be funneled back into the local economy -- I say, all power to them. Every one of those crew members is paying income tax and GST on top of any ancillary spending, regardless of what tax breaks the production is or is not getting. If that production weren't there, the tax haul wouldn't be there either, and there would be less money to go into government coffers.

So, yeah. Mostly right.