A concept lacking a name

In Canada, as well as a few other Commonwealth countries, the term 'Crown corporation' is used to describe a set of entities owned by the state but run somewhat independently.  Good examples of Crown corporation in Canada include things like CBC or Via Rail.

Not surprisingly given the inclusion of the word 'corporation' in the term, these entities are often means through which the state can participate in economic activities.  In some instances these corporations almost look like their private counterparts while in other instances it is clear that they are government own entities.

So even though Crown corporations may be of provincial or federal origin, the term provides a sense of clarity about their origins and relationship to government.

When discussing similar entities I immediately encounter two problems.  Firstly, if such entities can't be called 'Crown corporations' what can they be called?  'Government-own corporations' is an entirely unsatisfying name.  And, secondly, because there is no unifying descriptor they don't seem to discussed in the same way.  I know that I often forget how many government owned entities exist is the US because we almost never hear discussion of the entire class of entities in the way that we do in Canada.

I can't help but wonder how political discourse would change in the US if there was an easy and accessible way to talk about the class of entities which includes Amtrak, the USPS, and the FDIC, just to name a few.

(Maybe it doesn't matter, but I find it funny that Amtrak and the USPS use .com domains while the FDIC has a .gov domain.)

Hypocrisy $tar$ in the Globe or a Comment on Rex's latest column

As is my Saturday morning habit I started the morning off with a pot of coffee, breakfast, and the Globe and Mail. Not to long after I started making my way through the paper I ended up on the last page of the first section. After quickly skimming the page I decided that I would skip to Rex Murphy's column and then call it for that section.

It soon became clear that Murphy was using the column to take issue with the relatively large, and growing, budgets associated with Hollywood blockbusters (and particularly the monstrous budgets associated with James Cameron). Murphy seemed to find the contrast between the general economic restraint associated with a recession and these ever growing budgets something beyond distasteful. Eventually Murphy introduced the idea that the 'stars' in these films are now sometimes paid more than $20 million for their 'work.' Jim Carrey, and a few recent comments about greed and ambition, received particular attention and criticism.

As much as I might agree with Murphy about the absurdity of pay rates of contemporary Hollywood actors, I think that he missed the larger picture by making them the central component of his critique. These pay packages are really only a very small part of the picture when it comes to the economic implications of a Hollywood blockbuster (particularly a $500 million blockbuster, such as the one James Cameron is trying to make).

Unlike the picture that Murphy paints, the money used to make these movies does not just disappear, nor is it a case of feeding babies or making a movie (without such a movie no more money will go to the perpetuation of the welfare state). More accurately, money is invested a number of interests/corporations and people and then disbursed as salaries or payments during the making of the film. A much better way of thinking about a $500 million film is as a project that will take $500 million from corporate backers and distribute it among those parties involved in the production process. So instead of this money being wasted, it is likely providing pay cheques to thousands of individuals during the course of the production of the movie. If successful, such a movie would the replenish the coffers of the investors allowing them to invest in future projects. Ideally the cycle will repeat itself without pause (creating jobs and economic growth with each iteration).

I guess what I found strange about the column Murphy's seeming unwillingness to accept that transactions like those that result from the funding of a movie are what fundamentally drive our economy. To associate Carrey's comments about ambition and greed with such a picture was a rhetorical trick that did nothing but obscure the larger picture as well as the specific outcomes that are likely to come from a $500 million movie.

Only by investing money and creating jobs are we likely to exit such a recession. Staying at home and keeping our bank accounts tightly secured, on the other hand, isn't a viable solution to the problem.

While one may not like the package that comes with the Hollywood blockbuster (and I am not a big fan) it seems unfair not to acknowledge the positive economic benefits that are likely to flow from such enterprises. To impugn major capital investments, even if they are for Hollywood films, in a period of time when their absence is a notable part of the problem seems not only to be unreasonable, but to demonstrate a lack of understanding or misperception of the problem currently being faced by the economy.

So, yes, Jim Carrey may make ridiculous comments and be paid too much but that doesn't mean that blockbuster movies may not actually help us move out of the recession. Most importantly, it is not the case, as Murphy's comments seem suggest, that we should sit back with a sense of quiet respect and acquiescence as the recession runs rampant and refuse to attend movies, or other participate in other forms of economic activity that may stimulate further economic activity and growth.

It is rather ironic that Murphy didn't catch the hypocrisy in his own column yet was so quick to jump on it in Hollywood.