Once again, Governor Gavin Newsom appears to be playing a risky game of catch-up, this time with Hollywood itself. Recently, Newsom has been waving around his film and TV tax credit plan as if it’s a magic wand that will summon back the production industry to its former glory days in California. He claims this initiative is on track to generate a hefty $6.6 billion in California production spending. Quite a flashy number, but is this really the Hollywood resurgence that he’s promising? As they say, the devil is in the details, and it turns out there might be a few goblins hiding in those numbers.
It’s not that the tax credits haven’t made a dent—they have. They’ve lured back some of the production spending to the Golden State. But thinking this is the silver bullet that will return Hollywood to its glory days may be wishful thinking. California is now competing against an array of global jurisdictions that have spent years building their own production infrastructures. Perhaps Newsom should have been listening when countless industry voices warned it was easier to keep the film business here than to lure it back. But why let common sense get in the way of a good political headline?
And let’s not forget that while the industry might be trickling back, it’s not exactly flooding in. Anyone with a passing knowledge of the film business understands that California remains one of the most expensive places on Earth to shoot a movie. Throw in some of the most challenging regulatory environments and you have to wonder why anyone with something called a budget would opt to film in California over, say, practically anywhere else on the globe. In this cutthroat capitalist world, studio heads have shareholders breathing down their necks to ensure every dollar stretches further. Why would they stay in a place where it stretches the least?
The frustration among industry professionals is palpable, as they ponder ways to keep shows and movies shooting locally. Instead of innovative solutions, they find themselves calculating how many millions could be saved by moving production elsewhere. Newsom’s tax credit song and dance is certainly a start, but it’s hardly the grand finale that Hollywood needed. The stark economic reality is that without more significant incentives, the real stars of the production world—financial savings—will continue to steal the show abroad.
Ultimately, this might just be another chapter in the saga of California’s struggle to maintain its allure. If the governor truly wants to keep the brightest lights of Hollywood shining in his state, perhaps he might consider what industries around the world do: adapt, innovate, and offer competitive advantages that make economic sense. It’s great to dream of a booming Hollywood, but all the dreams in the world won’t change the harsh reality of economics. Unless, of course, Gavin Newsom has a sequel in mind, maybe “Calitopia: Escape from Hollywood,” but don’t hold your breath.
