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OTHER VOICES: Rethink the film tax program

Since Michigan agreed to offer a tax credit of 42 cents for every dollar spent on in-state film production, film-industry expenditures have mushroomed from $2 million in 2007 to $224 million in 2009. Even so, the future of the Michigan film tax program has recently become the subject of a pointed political debate. Rather than bicker, let's think differently. Why not envision the program as a fundamentally important infrastructure project that we can analyze and understand with much greater precision than is currently the case? Than we can defuse this tension and settle the future of a promising program. Some argue that the program doesn't make economic sense. According to a report by the Michigan Senate Fiscal Agency, the state spent $68.7 million of tax credits for the film industry last year, only to receive $7.5 million back in tax revenue. There's no denying that's a $61.2 million hole for 2009 in Michigan's budget. Furthermore, gubernatorial candidate Rick Snyder is on record against the program because it doesn't fit his conservative economic philosophy. When asked about the program, Snyder stated that government should not be in the business of picking winners and losers in the private sector. Public defenders of the program, such as Gov. Jennifer Granholm and Michigan Film Office director Carrie Jones, appear to accept the economic framework for debate. They fend off facts and beliefs mustered by conservatives by asserting that the industry is having a positive effect on jobs and small businesses, that it can drive the economy and that it can reignite our entrepreneurial spirit. Maybe with some frustration, Jones also alludes to more amorphous benefits such as "providing hope," and "reshaping Michigan's image." Conservative concerns about the deficit and views on overly aggressive industrial policy have merit. But, I think it would be wasteful to abandon this program on pure economic arguments after so much money has already been invested; especially if economic arguments aren't, in fact, entirely on point. We need to drill down more intently on understanding precisely what these amorphous benefits might be and why they might matter. What if we envision this program as a digital-age public infrastructure project? Perhaps it is akin to a public-private partnership that uses advanced technology to build community infrastructure vital to nurture and sustain a prosperous 21st-century economy. If the program is framed in this way, it fits neatly within our best conservative traditions about the uses of good government. What kind of public infrastructure am I talking about? Harvard professor Robert Putnam defines "social capital" as follows: "features of social life, networks, norms and trust that enable participants to act together more effectively to pursue shared objectives. Social capital, in short, refers to social connections and the attendant norms and trust." Putnam argues that high levels of social capital in the form of civic institutions and local traditions build trust across disparate groups. Trust is vital to regional cohesion, success and sustainability. The Detroit area, and by extension the state, has failed over many decades, one could argue, because of tribal tendencies that fracture bonds of trust among managers, workers, cities, suburbs and ethnic groups. Putnam argues that a low level of trust is anathema to building critical stores of social capital over time. What Michigan than needs as we transition into a globalized 21st-century economy is an aggressive investment in remediating this historic dearth of social capital.

of social capital. If we conceive of the Michigan film tax program as a digital-age social capital restoration initiative, than I believe the program can evolve in promising ways. In the digital age, everything, everyone and everyplace can be transformed by technology into a content asset to be consumed, shared and appraised. This process enhances the ability to "brand" an asset and anything it was before it was an asset. The Hollywood celebrities visiting our communities, for example, became powerful and lucrative brands through a repetitive process of being rendered as a content asset in films. I've been watching an organic process develop in which local people are interacting with celebrities in local places. People are using new technologies to capture moments and share these through social media. I argue that this nexus of local places, Hollywood personnel, local people and digital media can fuel the growth of something akin to a "digital public square." A critical function of this "digital public square" is to build our places into increasingly interesting and valuable brands. For example: the mayor of Rochester Hills shares with 561 Facebook friends photos of a dinner at his house with actress Ellen Barkin and director Sam Levinson; a local e-zine publishes on the Internet a video of a scene from "A Reasonable Bunch" being shot at The Chop House in downtown Rochester; a neighbor shares with 163 of his Facebook friends that he ran into Sean Penn at Cosi in Birmingham. It doesn't stop there. Professionals are integrating these places and people into their lucrative film properties. These films will be downloaded into perpetuity through Netflix and other digital services by people everywhere. The big payoff rightly cited by many is the large-scale investment in studio infrastructure here in Michigan. This permanent infrastructure is nothing other than tools and technologies that will allow our people to craft and distribute the films and TV shows that integrate local places and people. Where can such a focus lead us? A public campaign and research agenda let's call it "Places Matter" can help us find answers and help us optimize the unique potential of the Michigan film tax program. Content can be collected and stored in digital archives. Researchers can study and quantify the impact of this on our digitally fueled social networks and our stores of social capital. We can even ask the Hollywood stars to help us with the effort. Pitching in will make them feel good. G. Scott Aikens is vice president, leasing, of Birmingham-based Robert B. Aikens and Associates LLC.
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