While we at Big Journalism spend most of our energy correcting bias and falsehoods originating from the left, every now and then we must take a moment to gently correct things that go off track with our friends on the right. This is one such case.

Jim Geraghty started a brouhaha yesterday by criticizing how the makers of “Sarah Palin’s Alaska” received $1.2 million in tax credits by filming in the state — and that Palin signed the 2008 law which made it possible. Because she’s now apparently omnipotent, able to see into the future and plan for it by signing into law a complex program with numerous in-house checks and balances. Geraghty questioned Palin’s conservative credentials.

… but it looks problematic for a crusader for small government to end up collecting a seven-figure paycheck from an endeavor that received a seven-figure subsidy, all set up by a program she signed into law.

What’s problematic is to define the tax credit in this issue as a “subsidy.”

Tax credits are offered as an incentive to do business in a particular area, city, or state as a way to attract business and commerce into said area. These tax credits are usually offered as a percentage of total money spent and the credits can be sold at a discount to businesses looking to alleviate their tax load. The exchange creates a cashflow that helps offset the costs of doing that particular business in that area; in this case filming in Alaska is very expensive. A net gain of dollars flows into those local communities and the credits establish a way for a particular locality to compete with other cities or states for business; over the long term it can they help establish a broader tax base by increasing the number of professionals drawn to the area.

The optimal situation is to have a tax code is low enough where regulations aren’t so restrictive so as to warrant the need for tax credits. That is the real debate. However, it is within every state and city’s right to make themselves more competitive by offering tax incentives to attract business and create a business community. Aren’t we, as conservatives, supporters of the 10th Amendment? You pay for things by increasing your tax base, not by increasing regulations or taxes.

It’s also important to note that this was a bipartisan piece of legislation she simply signed into law to spur commerce and diversify Alaska’s economy — not something Palin created to help herself as has been subtly suggested on other parts of the web.

Still, should governments be in the business of subsidizing television programs? The precise arguments against PBS and NPR – that in today’s much more diversified media environment, almost all of the programming on government-funded radio and television networks could thrive in the private sector without government subsidy – would apply to the Alaska-based shows, no?

I respect Geraghty, but this is a bad argument. It’s incomparable to NPR (and absurd to compare it to other federal programs when this isn’t a federal issue) – this program deals with state tax credits first of all and secondly, it occurred in a state that enjoys a budget surplus, as Geraghty earlier acknowledged. Tax payers paid for nothing. It was also the cheapest PSA that Alaska has ever produced, considering that the cost of producing a comparable PSA campaign, excluding ad buys, would run in excess of $500k, and with ad buys you’re looking at over a million dollars. (Relatedly, my in-laws went to vacation and fish in Alaska recently based on the show alone. They found Alaska as beautiful as advertised.)

The bottom line is that the issue of film tax credits is grossly misunderstood. It’s a process open to anyone who can come up with a solid business plan to get them. Arguments against it include complaints about making states compete against each other; well, aren’t we conservatives? Don’t we like competition? Don’t we all realize that such widespread competition lowers the taxes across the board? Is that not a good thing, if we are to discuss this within the context of financial conservatism?

If limited government is to mean something, it means there must be some areas of economic activity that government does not seek to steer, influence, promote, regulate, or restrict.

Allowing companies more control over their dollars (by way of reselling credits, et al.) is less government intervention. Demanding more of their dollars is absolutely steering, influencing, regulating, and restricting the free market, and it certainly does promote the value of filming in one state over another.

As I said, the argument here should be about lower taxes across the board, as opposed to the actions some states must take in order to remain competitive. It’s also illogical to try and discredit Alaska’s program by comparing it with that of other states because variables differ in each state.

I love debate and disagreement when it occurs on the right because a competition of ideas ultimately makes the right stronger and frankly, more invincible. However, if you’re going to take a stand on an issue and place a target on a fellow conservative who takes more than enough heat from the left, it’s wise to make sure that you fully understand the issue and articulate it correctly.