On The Threat Of Film "Tariffs"
Cinema Takes Its Turn As A Target In The Culture War Shakedown
Last night, the head of the regime currently governing the United States announced that he would be unilaterally placing a “100% tariff1” on “any and all Movies coming into our Country that are produced in Foreign Lands.” Of course, the details of how this “tariff” would be levied have not been announced as making, buying, promoting, and exhibiting film is an international business with complex global taxation, financing, and production systems in place, systems that allow filmmakers and production companies to collaborate across borders.
The next time you watch a film, stay put and actually read the credit scroll, and you’ll more than likely discover that pre-production, production, and post-production work (especially in highly specialized VFX and animation categories) has been done in multiple global locations. It is not unusual to see VFX work completed in New Zealand, animation in South Korea, on a film that was shot in multiple nations, made by a studio who developed and financed the film in America by partnering with global investors. There are independent distributors who finance American films that are shot domestically and internationally, who also buy international films for domestic distribution in the United States, but also sell the rights to international partners for global distribution. There is international co-financing on films made by American filmmakers that are shot domestically and released globally, films that would likely face retaliatory “tariffs”, taxation, or incentive cancellations as a way to counter the penalty on a nation’s own domestic exports being financially punished by the United States.
All of that is to say that of course, right now, there is no indication as to how this proposed “tariff” would work within the context of this complex system. Would a domestic distributor pay a “tariff” on the purchase of a foreign film? If so, what does “100%” look like in a negotiated sale? Does a $5 million dollar foreign film sale suddenly cost $10 million, with the added $5 million going to the US Government? If that deal gets done, do distributors raise the percentage they receive from exhibitors, thus jeopardizing the domestic exhibition industry (aka movie theaters) who would see their bottom lines contract in an already perilous exhibition landscape? Or would production companies submit budgets to the government, with all foreign production costs then doubled by paying the equivalent of those costs to the US Government? Or would the entire production budget be doubled? Of course, no one has any idea— this is how government by individual fiat operates when the individual has no idea what he is doing or how trade, industry, and production work. Why should the film industry be exempt from this disastrous narcissism?
As the spouse of a film worker who has been on again/off again in production work here in New York City since the pandemic and has seen our family’s finances contracting over the past five years, I can tell you that the ability of individual states and local governments to attract productions that utilize local, union crews has been dwindling in the face of international productions, where crews and production costs are heavily incentivized by foreign, national film industries. But instead of establishing a ridiculous penalty for international production, the US should look to actually, y’know, compete— create a robust incentive program that supports the industry by investing in domestic production, putting US film workers on a competitive playing field. But, of course, that would require actual investment and support for film and television, and that is, obviously, not what this regime cares about at all.
Instead, this is simply another culture war salvo, using the pretext of “tariffs” as a way to seek economic control over the production of film and television, a way to exact concessions from the entertainment industry.
The regime gives away its intentions with the ridiculous evocation of foreign film production as “…. a concerted effort by other Nations and, therefore, a National Security threat. It is, in addition to everything else, messaging and propaganda!” And while the so-called “National Security threat” is a pretext to claim the power to enact “tariffs” on film production2, it is the “messaging and propaganda” pretext that stands out— like its shakedown of higher education institutions and technology companies, what the regime really wants is for studio heads, celebrities, and filmmakers to come to Washington on bended knee, begging for relief from the leader’s powerful economic controls. From there, concessions will be required— make more work friendly to conservatives, make propaganda supporting the regime, all part of the continuing effort to reshape the culture into Nationalist kitsch.
Unsurprisingly, the “tariff” announcement comes on the heels of the regime’s decision to rescind arts and cultural funding that was already approved by the National Endowment for the Arts, which severely impacts the non-profit arts sector including film non-profits like festivals, cinemas, and film education programs3. Instead of investing in these important cultural institutions4, the regime is working to construct a “National Garden Of American Heroes”, an idea so deeply soaked in schmaltzy, gilded sentimentality that it could only come from the same regime that took over the Kennedy Center in order to host a choir of criminal traitors whose sole “artistic” purpose is to glaze5 the regime’s leader.
The NEA grant cancellation emails go on to say that funds will instead be used to “foster A.I. competency, empower houses of worship to serve communities, assist with disaster recovery, foster skilled trade jobs, make America healthy again, support the military and veterans, support Tribal communities, make the District of Columbia safe and beautiful, and support the economic development of Asian American communities.” Of course, find yourself the richest nation in the world who can do all of this and still support the arts at the same time, but again, no. It’s tax cuts for the wealthy, huge cuts to critical government programs and services, and no interest in building a compassionate society beyond keeping it fractured along the false pretexts of a wholly manufactured culture war. Meanwhile, while you’re not looking, it is grift grift grift.
So, we have to be honest with ourselves; “tariffs”, the NEA— there is literally no interest in this regime in preserving the American film industry, film institutions, or our shared culture. If so, they would be investing directly in strengthening and incentivizing our industry and communities to support filmmaking and film workers. There is no investment. Instead, there is only the false pretext of emergency, of inserting the regime and its preferences into every corner of our lives in order to exert control over us, all under the pretext of “small government” which really means “no investment in the common good.” The nation is being lead by someone who did everything humanly possible to avoid personally contributing taxes that would help our society grow, who used charity as a pretext for fraud and further tax relief, and who considers this refusal to help the nation a sign that he is “smart.”
In lieu of investing in a thriving film industry, the regime is looking to take money away from all of us and redirect it toward policies that seek to re-define our culture along its own divisive fault lines, rigging the marketplace to exact concessions that bend our freedom of expression to their ends. It is urgent that all film organizations, from non-profit festivals to for-profit studios, stand up, hold the line, and find ways to mutually support each and every aspect of the industry to ensure that we continue forward without compromising what makes cinema so meaningful to so many.
The fight ahead requires us to shift our work toward protecting the communal, empathetic power of cinema to bring the world together.
I’m going to use quotation marks around the word “tariff” here because I have no idea what this actually means— what is the product? Against whom is the “tariff” levied? Which costs are being calculated to determine the amount of the “tariff”? No one knows.
The flexibility of the Executive Branch’s “Emergency Powers” means that EVERYTHING IS A NATIONAL SECURITY EMERGENCY!
Full transparency: I lead a film non-profit called Montclair Film in Montclair, NJ, which hosts a film festival, offers year-round film education programs, and operates a six screen cinema, called The Clairidge, in downtown Montclair.
The word of the year, in my humble opinion. We are living in a glazeocracy, friends. Just watch a cabinet meeting to see the world’s worst people tripping over one another to win the weekly glaze fest. Humiliating, really. For all of us.
Great piece, Tom! Thank you.
Nailed it, Tom. And of course there have been the lingering/looming threats of revoking non-profit status for cultural orgs, environmental groups, universities. Alarm bells all around are exhausting but demand organization and unified response.