Movie industry study deeply flawed

With legislators asking whether Louisiana can continue subsidizing the movie industry at a time of historic deficits, the film industry released its own dubious study on Monday that claims films and TV productions are responsible for almost 15 percent of state tourism. Counting this tourism spending, the industry claims, makes the program’s balance sheet look much better. But the pushback from independent economists was swift, reports The Advocate:

“It’s hard to believe; it’s a stretch,” said Steven Sheffrin, a Tulane economics professor — and director of the university’s Murphy Institute — who recently helped produce an analysis of Louisiana’s tax credits for the state Legislature.

The most recent independent report commission by the Department of Economic Development drew very different conclusions, finding (as previous studies have done) that movie subsidies carry a high cost to state taxpayers. That study also said the number of jobs attributed to the subsidy has been inflated in the past because of the “heroic assumption” that millionaire Hollywood actors and directors spend all their money here, when in reality they just take most of it back to California. LSU economist Loren Scott, the author of LED study, told the Baton Rouge Business Report the idea that movies caused 15 percent of tourism “doesn’t pass the laugh test.”

As LBP told the Advocate, the industry’s study was misleading and relied on flawed assumptions:

The Louisiana Budget Project, in a report critical of the film industry study Monday, said HR&A inflated the tourism impact. The budget project noted that “the study attributes 14.5 percent of state tourist visits to film and TV production but says that ‘should be considered upper-bound estimates’ and that there ‘may be other factors that contributed to their visitation and spending patterns.’ ”

You can read LBP’s full take on the study here.

High school graduation rates on the rise

For the fourth year in a row, the percentage of high school students who graduated increased, reports the Associated Press, though Louisiana still lags the national average and racial disparities persist:

In 2014, 74.6 percent of students graduated on time, up 1.1 percent from a year before. Nationally, about 80 percent of students graduated in four years. “Our state is making undeniable progress,” said state schools Superintendent John White in a teleconference with reporters. Graduation rates have been improving for the past decade. The rate for 2014 is about 10 percentage points higher than a decade ago. White said the brightest spots in the 2014 numbers were found with students with disabilities and those from families with low incomes…From 2013 to 2014, the graduation rate for students with disabilities saw a 6.1 percent increase. Still, only 42.8 percent of students with disabilities graduated in four years last year. Meanwhile, the state saw 2 percent more African-American students graduating on time, bumping up the graduation rate among blacks from 65.9 percent in 2013 to 67.9 percent in 2014.

Talk is cheap

So says the Advocate’s editorial board about the four gubernatorial candidates’ call for a special legislative session next year to deal with the state’s budget crisis.

The “commitment” of leading candidates for governor to call an urgent special session next year on state finances is underwhelming, and voters deserve to hear a great deal more in the way of credible policies that the candidates would actually pursue if elected in the fall…We are not trying to be supercritical here. These are candidates who want to avoid offending powerful interests and also don’t want to be tagged as tax-raisers in the campaign, even if it is practically inevitable that some revenue will have to be raised somehow.

It is the deference to “powerful interests” and unwillingness to tackle Louisiana’s revenue problems that has led us to this point. On the bright side, unlike in years past, dozens of legislators have filed bills this year that could actually raise some revenue and start to reform wasteful subsidy programs. You can search the bills pre-filed with the tax-writing House Ways & Means committee and Senate Revenue & Fiscal Affairs committee by clicking here.

Poverty and health in northeast Louisiana

The latest county-by-county health rankings are out from the Robert Wood Johnson Foundation. And not surprisingly, the poorest parishes in Louisiana also tend to be the least healthy. The Monroe News-Star decided to interview freshman Rep. Ralph Abraham about this phenomenon, since he also happens to be a physician. And Abraham, revealingly, blames the problem on everything except the state’s failure to take advantage of federal dollars to expand coverage.

“The heart of the problem is poverty, and to get people out of poverty we need two things — education and having a job waiting on them. One without the other will fail. It sounds like a simple formula to fix, but it all goes back to regulations on businesses and getting government off our backs. There’s so many regulations we have to jump through to see patients. At my Mangham clinic I had to hire three people last year just to deal with all the regulation matters,” Abraham said.

Number of the Day

25 – Percentage of movie subsidies that go to Hollywood actors, directors and producers. Little of that money is spent in Louisiana to boost the economy, but instead goes back to California (Source: Loren Scott, Louisiana Economic Development)