Tax Incentives

Ask not what your country can do for you. Ask what your country has done for you lately. With apologies to John F. Kennedy, that's what concerned citizens should be doing to get their heads around the debate in Washington about the appropriate size and role of government. Despite how riveted we are by Washington blood sports, average citizens don't always understand what "government" means. That's not because they're dumb; it's because the nature of government ? especially the programs it pays for that affect most Americans ?

A "double dip" in home prices appears to be underway in the nation's biggest cities, jeopardizing the tepid U.S. economic recovery. The widely followed Standard & Poor's/Case-Shiller Index, which tracks the real estate market in 20 major U.S. cities, showed that prices dropped 1.6% in November from the same month a year earlier, the second consecutive year-over-year decline. What's more, the index fell 1% in November from October, marking the fourth consecutive monthly decline. Last year, a recovery in housing prices seemed to be on track.

Could the forthcoming report of a bipartisan presidential deficit-reduction commission ? due Dec. 1 ? lead to fundamental changes in the way that homeownership is treated by the federal tax system? For decades the political rule on Capitol Hill has been that nobody messes with homeowner tax benefits ? mortgage interest deductions, capital gains exclusions, property tax write-offs ? even if they cost the government hundreds of billions of dollars in tax revenue a year and increase the federal deficit.

Tough economic times are providing the backdrop this week as television executives swarm Cannes in the south of France for their industry's largest international sales festival. European broadcasters, like their counterparts in the U.S., have been reeling from a steep fall-off drop in advertising revenue. Even more so than in the U.S., the uncertain economic climate in Europe has meant less money for independent TV producers, who are jostling one another to place their shows on the air. Michael Murphy is a longtime TV executive who launched a channel in Ireland in 2006, only to sell it two years later ?

Fueled by tax incentives, California home sales rose in May, helping lift the Golden State's median home price by 20.9% from its year-earlier mark. The median was $278,000 last month, MDA DataQuick of San Diego said, a 9% increase from April. But that reflects less a rise in the actual valuation of homes than a continued shift in sales away from cheaper, inland areas of the state toward more coastal markets. That shift is being driven partly by an increasing willingness of owners in pricier neighborhoods to sell at a lower price, DataQuick has said.

The Southland's housing market surged in May with the median home price soaring 22.5% from its year-earlier level as tax incentives for buyers and rock-bottom interest rates ignited sales, a real estate research firm reported Tuesday. The median hit $305,000, according to MDA DataQuick of San Diego, putting the closely watched figure above $300,000 for the first time since October 2008, when valuations were declining rapidly amid the fallout from the subprime mortgage debacle, credit crunch and financial crisis.

The Autobots and Decepticons are back in town. Director and executive producer Michael Bay has begun filming the third installment in the "Transformers" franchise in Los Angeles, where the production economy has been buffeted by the loss of such big studio features to other cities offering more generous film tax incentives. The DreamWorks/Paramount Pictures production has been shooting on a sound stage at the former Spruce Goose Howard Hughes hangar at Playa Vista and will film exterior shots throughout the L.A. area over the next several weeks, including Long Beach, West Hollywood, Century City and Malibu.

Few comic book characters are as homespun as Captain America, who uses his superhuman powers to fight the Nazis during World War II while draped in the colors of Old Glory. Yet even Captain America's overtly patriotic credentials weren't enough to keep a film about his exploits from being shot overseas. The upcoming movie from Marvel Studios was originally to be filmed in Los Angeles. Instead, "Captain America: The First Avenger," starring Chris Evans, Samuel Jackson and Hugo Weaving, will shoot this July in London, where the story is partially set. That decision was a blow to L.A.'s below-the-line community, which had been banking on the project to employ hundreds of crew members at a time when relatively few big-budget features are shot locally, thanks to rising competition from other states and countries.

Question: How do you pack a theater with jaded movie industry professionals? Answer: Show them the latest hot information on film tax credits. Nearly 200 people crammed into an auditorium at the Landmark Theatre in West Los Angeles recently to learn the latest skinny on the kind of topic that would set an accountant's heart aflutter. The filmmakers, production executives and bankers were attending the Spring Fling Production Incentives Symposium, hosted by the aptly named Incentives Office, a Los Angeles firm that helps filmmakers and lenders navigate the welter of tax credits and rebates.

Eager to show Americans that they are focused on reversing widespread unemployment, Senate Democrats on Thursday unveiled a package of legislation dedicated to spurring job growth. "Our No. 1 emphasis is going to be on creating jobs," said Senate Majority Leader Harry Reid (D-Nev.). But the political question hovering over the newfound push is whether it comes too late to quell growing voter dissatisfaction with how Democrats are handling the economy. Ironically, the announcement of a job-creation package came on the same day that Scott Brown, the winner of a special election last month in Massachusetts, is set to be sworn in as a new Republican senator.