Negotiating with Extortionists. Martin O'Malley makes a deal with Francis Underwood

As readers of this blog know, MOCO Musings has not been a fan of the tactics employed by the Netflix show House of Cards (HOC) to increase its tax credits from the state of Maryland.  (The show shoots in Baltimore, Annapolis, and Harford County).

To date, the show has received 26.6 million dollars in tax credits during its two seasons.   At the start of the year, the show's producers made a 'pitch' to increase their tax credits for the upcoming (3rd) season of shooting.

HOC used a combination of soft and hardball tactics. On the softer side, Kevin Spacey visited the state to host a cocktail party and pose for selfies with groupieselected officials.  On the hardball side, the show's producers sent Governor O'Malley a stern letter warning it might leave the state if bigger tax credits were not forthcoming.

In April, the Senate approved an increase of 15 million dollars, but the house wanted a smaller figure and an agreement that the state could use eminent domain to seize film equipment if the show left after receiving tax credits.  The two sides couldn't agree, and the Assembly closed before a deal could be reached. 

In walks Martin O'Malley to 'save' the day.  The show will now receive 11.5 million in tax credits for its third season.  It is unclear exactly where the money is coming from (since the General Assembly didn't vote for it).  But, state 'grants'  appear to be in the mix. 


The amount is less than what the show received for its first two seasons (about 13 million for each season), but a lot more than many people thought it deserved.

What's the lesson here?  For his part, the governor chose to downplay the previous conflict, relying on a too cute by half press release that began:  "Spoiler alert: we’re going to keep the 3,700 jobs and more than 100 million dollars of economic activity and investment that ‘House of Cards’ generates right here in Maryland."

Another way to look at it is this:  you can negotiate with extortionists for a markdown.  

All of this reminds me of another TV show set in Baltimore, The Wire, and a character on it, Tommy Carcetti.  Rumor always had it that Carcetti, a city councilman with mayoral ambitions, was based at least in part on Martin O'Malley.  Carcetti was an idealist whose mayoral ambitions got in the way of his idealism.  Whether or not the rumor is true, it seems apt today.