As Hollywood gets ready for its biggest night, the 86th Academy Awards, one is reminded of the glamour and power of Tinsel Town’s motion picture industry, as well as the big personalities who perform on its sound stages. Hollywood, of course, is a very left-wing place, judged from the fabled political stances of many of its celebrities, from Oscar-winners Warren Beatty and Gwyneth Paltrow to 2014 Best Actor nominee Leonardo DiCaprio, a maxed out Obama donor and hard-core environmentalist.
These entertainers have surely been generous donors to liberal causes and politicians. And as he readies to run for his unprecedented fourth term as Governor, California’s iconic liberal, Jerry Brown, has amassed a huge $16 million fundraising advantage with the help of these same entertainment industry friends who will be sitting in the Dolby Theater this weekend. This includes $27,200 maximum contributions each from the likes of director Steven Spielberg and his wife, DreamWorks CEO Jeffrey Katzenberg, music impresario David Geffen, and Paramount Pictures Group.
Jerry Brown has indeed been a liberal tax-and-spend governor. With help from his allies that control the Legislature and every statewide office, Brown has implemented policies that have California now leading the nation not only with the highest state income tax rates, state sales tax rates, and taxes on gasoline at the pump, but also in poverty.
In the last two years, as California’s taxes have reached their zenith in the nation, California has ignominiously become the state with the highest poverty rate in the nation. Over 6.1 million Californians now live in poverty, comprising 23.8% of the population, according to the Census Bureau. Though liberal Nobel award-winning economist Paul Krugman has yet to publicly help connect the dots, the data offers little question that liberal politicians in California are raising the cost of living with their high tax and regulatory policies and thereby pushing poor people deeper into poverty, with no relief in sight.
But California’s low-income residents are apparently not the only ones hurting in the state. California now also seems to lead the nation in harmful taxes and regulations on the same Hollywood film industry that has been the bedrock of support for liberalism and Brown himself. According to Film Works, an entertainment industry lobbying group, California’s taxes and regulations on film and TV production have caused a massive “runaway” of production out of the state, to places more welcoming to doing business, which includes even liberal New York. One therefore wonders whether the movie moguls and talent celebrating the film industry at the Oscars this weekend really grasp that the liberal politicians they support in California are responsible for killing off their livelihoods, at least in the Golden State.
Film Works says on their website that since 2012 (when Brown’s “Proposition 30” tax hikes passed), of the last major 45 big-budget film projects in the United States, only one was shot exclusively in California. In the last eight years, the organization says the state has lost 8,500 film industry jobs as a result of a steep decline in the state’s share of production of 1-hour TV series. Film production in Los Angeles of the top grossing films has dropped 60%.
Other states, including Georgia and even deeply blue New York State, have responded to the economic downturn by developing investment and job growth strategies that focus on lowering taxes and regulations on businesses, including the entertainment industry. These states are having success in improving their economies. Perhaps the best recent example of the success of New York’s policies with the entertainment industry is the fact that after decades in Hollywood, NBC’s The Tonight Show has moved from Burbank to New York City in part as a result of a tax credit offered by the state, “bringing more than a hundred jobs to hard-working New Yorkers,” according to very liberal Mayor Bill de Blasio. The tax incentives NBC took advantage of were a part of the state budget promoted by liberal Governor Andrew Cuomo to lure new investment into the state.
The contrast between Jerry Brown’s dangerous high tax policies that are encouraging businesses to flee his state and the tax incentives offered by New York that allow liberals like Andrew Cuomo and Bill de Blasio to stake their claim as job creators could not be more ironic, especially when the industry being forcibly exported out of California is Hollywood entertainment. But the scenario, and the lesson to be learned, even by left-wingers, is exactly how economic development should work. California’s liberals have simply not learned the lesson.
James V. Lacy’s first book, Taxifornia, is available at Amazon.com.