Alluding to industrywide complaints that store owners frequently ask for money in return for allowing a production to take place outside their businesses, Dalal recommended that lawmakers address ethical issues, perhaps by creating a “code of conduct” for the industry.
“Los Angeles is known as the extortion capital of the world for the film industry,” Dalal said.
Extortion? Really? I’d like to ask the LA Mayor’s Film Czar’s office how they can accuse business owners of extortion when the film industry does the same thing on a more perverse level with their demand for more film subsidies.
According to Mr. Dalal’s statement, when disrupted business owners ask for compensation from Hollywood studios that shoot in front of their shops, that’s extortion, but those same studios threaten to disrupt the CA film industry by leaving unless the government gives them more free taxpayer money. Is that not the same type of extortion the Mayor’s film czar office says the studios are a victim of?
Looks like the pot is calling the kettle black here and the media and the public are wising up to this ruse.
The LA Times Michael Hiltzik already warned of what he calls “corporate extortion” by the studios earlier this year. This weekend NPR had a report where even the pro-subsidy people use the words “prostituting” and “cockroaches” to describe the studios’ subsidy practice. The LA Daily News followed up their report with a quote from an interview they did with me in reaction:
Not everyone supports City Hall’s backing of subsidies. Entertainment worker Daniel Lay, co-founder of ADAPT (Association of Digital Artists, Professionals and Technicians) believes studios are extorting local governments. Lay said Garcetti is “part of the problem” because he supports incentives.
“The studios are just looking to pit various governments against each other,” Lay added. “That’s the game that they are playing.”
The studios are demanding potentially hundreds of millions of dollars more on top of the $100 million they already receive. Even with that potential deal they even refuse to guarantee to bring more jobs back to CA. Why? Because they will take CA’s offer and game it against other governments in the hopes of maximizing the amounts of free taxpayer money they receive.
Furthermore, those local struggling businesses accused of extortion by the Mayor’s office pay taxes here and have managed to stay in California to do business without any special deal from the government to subsidize 20% of their costs. The Hollywood studios are making billions and already have a deal where California taxpayers pay 20% of qualified costs — and that’s still not good enough for them to stay.
Does that sound like extortion to you? Sure does to me.
Perhaps the Hollywood studios need to be given their own “code of conduct.” In fact there already is a code of conduct at the Federal level we intend to use. The Tariff Act takes disciplinary action against producers who try to use piracy or subsidies to harm domestic industries. It contains provisions that allow for the placement of anti-subsidy duties that nullify and negate their distortive effects.
A comprehensive program is needed to end the film subsidy race. It’s extremely important that studios are disciplined for these kinds of actions. Without enforcement, Hollywood studios will continue to extort a larger and larger amount of taxpayer money to fund their productions.