Newsom wants Trump to subsidize Hollywood

One of the great dilemmas faced by democratic governors with not so secret white house aspirations is how to exploit the intraparty fury to Donald Trump while protecting the interests of the state of origin from Maga's reprisals. We recently saw that Gretchen Whitmer of Michigan burn a large part of his presidential wood by leaving Trump to obtain photo sessions with her while she funding For a national guard project in its state. The governor known to have the most extreme case of the White House Hots, Gavin Newsom in California, went back and forth between the aspirant to the 47th president and making him explode.

Now Newsom has put a major bet on cooperation with Trump on a question particularly associated with the Golden State. One day after the president proposed to use his favorite weapon, the prices, to achieve the profitability of the production of foreign films, Newsom countered by encouraging the administration to work with him to develop a new massive federal tax subsidy for the entertainment industry, as Washington Job reports::

California Governor Gavin Newsom (D) is proposing to join the Trump administration to create a federal film credit on films worth at least $ 7.5 billion to stimulate the production of national films, said his office on Monday evening. The proposal came after President Donald Trump put Hollywood on the edge Call at massive prices on films made abroad to approach what he described as the “DYING” American film industry.

Although Newsom clearly offers an alternative to the prices of Trump's foreign film (partly because they are unpopular in Hollywood), he is happy to make a Maga brand for an effort to rescue American films:

“America continues to be a cinema power, and California is while bringing more production here,” Newsom said in a statement.

He added that California is “eager to join the Trump administration to further strengthen national production and make America's film again.”

The opportunism of the subsidification gambit of the Newsom federal film is impressive. As a New York Times observationsThe American film industry is already flooded in state subsidies, mainly extended via transferable tax credits which can be sold for difficult species to stimulate the results of the production company:

[Newsom’s] The proposal, if it was approved, would by far represent the largest government grant program for industry in the United States, and the first of its kind at the federal level. More than three dozen states already lend incentives to attract and preserve cinematographic and televised production, but there is no national program, as is the case in some countries abroad. And there is no unique state program that gives more than about 1 billion dollars each year. California currently allocates $ 330 million a year.

Indeed, before this last offer of federal action, Newsom had proposed Double California tax credit To protect Hollywood from competition abroad and national (Georgia, for example, has a Much more important grant programAnd Canada has successfully competed for film projects for years with its own tax credits). It is not clear if a federal credit would benefit California in its national competition for film projects, but this could undoubtedly increase the amount of the financing of the states to be divided. And Newsom is not the only Californian to think that way: according to the TimesSenator Adam Schiff Develops a bill that would create federal credit in anticipation of a joint Newsom-Trump initiative.

We don't know if Trump will take Newsom's bait. The unpredictability of the president to stimulate the American film industry was made obvious with his proposal For a 100% price on foreign films. Trump's friend, actor Jon Voight, had suggested various industry incentives, but Trump mainly made on prices. As The hill explain“The plan that [Voight] Presented to Trump, as well as the terrible assessment of the actor with regard to cinema in the United States, calls for “ tariffs in certain limited circumstances '', as well as incentives for domestic manufacturing films. “The idea of ​​100% Trump is not particularly limited.

The broader question about the federal subsidy supply of Newsom (and Voight) is whether it's a good idea. A crowd Of various states of the country have concluded that subsidies cost a little more than they deliver it, in particular if they are not carefully adapted to encourage long -term development of cinematographic infrastructure. Maybe the most overwhelming analysis was carried out in 2023 by the Georgia State University tax research Center, in the very belly of the subsidy program of the Beast of Peach State. He concluded that “for each dollar spent on incentives, only 19 cents have been returned, in accordance with other similar studies such as that of New York, with a return between 15 and 31 cents.” A Times report On a push in Michigan to create a new grant program in 2024, the star character of such initiatives:

External experts say that the effects of these expenses are overestimated and that initiatives are incredibly expensive for governments of the States. But their university newspapers compete with the promises of lobbyists and the appeal of Hollywood stars and exclusive holidays.

The term not so technical for such subsidies is Business well-beingAnd a precise description of the competition for film projects is a “downward race”. The widening of these subsidies of states to the federal government makes them no less doubtful, and the extension of competition for government dollars to the whole world does not make the game less ineffective and corrupt at the limit.

If he produces the hopes of Fruit Newsom poisoned, the idea of ​​federal credits can create beautiful moments in love for the Governor of California and his Frenemy in Washington. But at a time when Trump and his Congress allies were determined to reduce the financing of federal programs really benefiting people in need, it would only be another tax gift White lotus together.