Vast Government Subsidies Are as American as Apple Pie

[Do not forget that the VFX Bake Off will be Jan 9 at the usual place and the usual time].

There has been a lot of discussion recently about various government subsidies and tax incentives to filmmakers who do certain kinds of production or post-production work in that country. The country that offers such benefits is in effect co-financing a film with their tax dollars, and in return, sees employment and other benefits brought to a very prestigious industry in their country that might not otherwise be able to compete internationally.

As always, in matters of this type, subsidies are not the sole cause of the situation. None of this would really happen if the industries in the subsidized countries did not demonstrate skill in the areas involved. In many cases, such as the case of the UK and London, there is a long-standing community there that is highly esteemed. Nevertheless, that industry is greatly nurtured and supported by their government's actions on their behalf.

Furthermore, let us not be naive.  This did not just happen.  The local industries have been working with their respective governments to get these advantages.  And can we perhaps suspect that producers and studios have also used their persuasive ways to encourage these governments to shower their beneficence upon them?  Yes, of course they have.  That's their job.  (2)

In the last month or so, three major events have occurred that will likely determine the fate of the motion picture visual effects industries in various nations for the better part of the upcoming decade. All three events are structural and examples of how governments manipulate trade and industry in their perceived national interest.  This is something we, the USA, does whenever it is convenient for us to do so, a topic I will expound upon in an upcoming post.  (1)

The net result over the medium term is that the American effects industry will continue to be destroyed, and that work will pass to three other nations which will develop the technology, employ the people, receive the money, the awards and the careers that come with it.

The issues involved in this matter are far too complicated to put in a single blog post at this time. The best I can do, with my other responsibilities, is to break it into about 5 posts on various topics in this larger subject. The topics will include (a) what has just happened that will set the stage for the next decade, (b) what the effect the actions will have on the domestic visual effects industry, (c) some of the history of international trade and preferential subsidies and other means and (d) the argument will be made that change will only be possible by organizing and working within the political system that exists in this country.

Failure to organize and express our interests politically, which is the current state of things, will result in the destruction of the American industry. Actually that destruction is nearly complete as it is, so the best that could be affected is perhaps a renaissance of those industries.

Without political action, there is not a prayer of success.

Next: Three recent events

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1. But if you want a taste of it, see to what extent our government is involved in the creation and current success of the aerospace industry.  This is not subtle.

2. Their job, generally speaking, is to make money by making entertainment product.  They make money a number of ways, but one way is to lower the costs of any given production.  If someone wants to give money, why not?