On Sunday, Trump sent out of his long, manic social media postings about saving Hollywood by imposing tariffs on “any and all” productions that are filmed overseas and shown in the U.S. This is ludicrous. I've worked in the film/TV industry for decades. Not only do I have no idea how this would work (or what it would even accomplish), I doubt that Trump does either. Besides which, the movie industry is not only the top export from the United States, but it has a massive $15 billion surplus!! Let me repeat that: The U.S. does not have a trade imbalance with movies. They have a $15 billion surplus. This is not what is generally considered a problem. At least in a rational world. Yes, what is known as "Runaway productions" are a problem, but this is completely counter-productive to that. "Runaway productions" are usually those that don’t film in Los Angeles, but rather shoot in other U.S. states like North Carolina, Georgia, Texas, Illinois and NY where they get local tax breaks -- not overseas, other than Canada for some TV series -- so the very point of this whole "tariff" idiocy, saving the movie industry, is for the most part, 100% utterly meaningless. The concept is bizarre and confusing and ill-thought out on so many levels. Furthermore, it's completely unclear if Trump’s statement means that he wants to put a tariff just on U.S. movies that film outside the country, or also on foreign movies that are brought into the U.S. It sounds like it does, since he talks about "any and all" movies made outside the U.S. Which, if that was the case, would be even more ludicrous. Those films, made by foreign countries themselves, of course have absolutely zero to do with runaway productions and the production cost of movies, nor ticket prices. And they have no impact on taking work away from Americans. None. Zero. Moreover, how do you even put tariffs on making movies outside of the U.S.? And again, what would it even accomplish? It might possibly (might) offset foreign tax incentives enough on some films (some) to keep some U.S. productions from leaving the U.S. (Keeping in mind that, as with all tariffs, a tariff is by the distributor on the U.S. side – which in the case of movies is often the studio that made the film.) But a foreign country can just lower its own taxes and give other incentives to keep costs for the production low, in order to get all the financial benefits of having a film shooting there. And also, unlike a hardware product, there’s no way for the “manufacturer” of a movie to reclaim the tariff by raising prices. It’s not like a tariff would get theater chains to raise their ticket prices, since they’re not the ones paying the tariff. (Could a studio try to get more from theaters if their costs rise? It’s possible, but that’s not only how studios have operated with high budget films – but theater chains would likely balk at paying more, since they’d have to raise their ticket prices, at a time with theatergoing is facing challenges.) But also, if a movie’s story takes place outside the U.S., which is usually the reason for filming many, if not most movies out of the country, it won’t stop anyone from going overseas. But even more – and “but even more” is a recurring theme with this idiotic idea -- this doesn't take into consideration how so many U.S. movies in general, let alone U.S. movies shot overseas, and especially foreign-national productions (again, if this even is supposed to pertain to them) aren’t even “brought into” the country anymore to show in theaters, but stream online. And they could stream from anywhere. So, would these suggested tariffs apply to movies that stream, or only those that are shown in theaters? And on what would the tariffs be based? Production costs, box office revenue, profits -- and what about delayed royalties, which are foundational to film productions costs? This "idea" is insane and unworkable. And actually harmful to the U.S. film industry. But “insane” is a good place to start – and end. In fact, how insane is the idea? Only one day after Trump made his manic posting, the White House released a statement that what Trump wrote was only a general idea and that nothing specific had been worked out. Gee, no kidding. Just what you want from a president. General, insane rants that haven’t been worked out. And, hopefully, may never be. Contrast this with a proposal made yesterday by California Governor Gavin Newsom. He brought up a $7.5 billion federal tax incentive to movie companies. Adam Schiff is working on a similar idea in Congress. Whether such measures ever become law, both are rational and sane, and would help accomplish precisely the point of creating incentives to keep movie productions from going overseas. The one thing they're not -- is insane.
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AuthorRobert J. Elisberg is a political commentator, screenwriter, novelist, tech writer and also some other things that I just tend to keep forgetting. Feedspot Badge of Honor
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