Emulating Frank Underwood, "House of Cards" schemes to extract more cash from taxpayers

By David Sirota , written on February 21, 2014

From The News Desk

In a move straight out of Frank Underwood's playbook, the production company for "House of Cards" is threatening to “break down our stage, sets and offices and set up in another state” unless Maryland gives it even more taxpayer subsidies. The news comes a day after Pando's report documenting how such film subsidies are often net revenue losers for taxpayers in states across the country. Lately, they’ve also become a magnet for serious political corruption, as at least five states have recently faced serious scandals involving their film subsidies.

In its report about the "House of Cards" situation, the Washington Post quotes one Maryland lawmaker asking, “Is it possible that they would just leave after we gave them $31 million?” Another declares, "We’re almost being held for ransom."

Meanwhile, Maryland's economic development officials are quoted touting the local economic boost  from the show. But those officials didn't actually prove that the boost was a result of the subsidies, rather than something that would have happened without all the handouts (note: a study for the Maryland Film Office admits it "is virtually impossible to make a clear distinction between the ongoing, indigenous film and television industry in Maryland and that part of the industry that is associated with 'imported' film and television projects"). They also didn't prove that spending money on film subsidies provides a bigger economic boost than spending that same money on other more pressing priorities.

Of course, after Maryland tripled its Hollywood handouts earlier this year, “House of Cards” lead Kevin Spacey lauded the state for its "fantastic tax breaks.”

Apparently, though, the current "fantastic" handouts may not be enough for “House of Cards” - or at least that’s what the producers are now saying in what may be a carefully orchestrated Underwood-like power move to exploit a separate series of events unfolding in neighboring Virginia.

Yes, at precisely the moment “House of Cards” is threatening to leave Maryland, Virginia’s legislature is considering expanding its film tax credit program by a whopping 500 percent.

That, of course, raises questions of timing: Are the producers of “House of Cards” deliberately trying to use the situation in Virginia to get more taxpayer money out of Maryland? In Underwoodian fashion, are their sudden threats to leave deliberately timed to the Virginia situation, knowing that Virginia’s potential move will make Maryland legislators more fearful they will lose film productions?

It is difficult to know for sure, and "House of Cards" producers would probably say they couldn't possibly comment. What is clear, though, is that this is exactly the way tax subsidy competitions create revenue-draining races to the bottom. That may serve Hollywood well, but it often reduces public revenues and drains critical resources away from basic government services.

Considering his enthusiastic efforts to undermine his own party’s support for social programs, Frank Underwood would most certainly approve. But do taxpayers?