Newsom’s Egregious Hollywood Taxpayer Gift

Massive Hollywood Tax Credit Is A Cynical Ploy for 2028

Governor Gavin Newsom's revised budget proposal is a lesson in political cynicism. With a $12 billion deficit looming before him, Newsom has proposed cutting some other spending (excluding healthcare for illegal immigrants) — while simultaneously proposing to increase the state's film and television tax credit by more than double to a staggering $750 million annually. It's not about saving Hollywood; it's about Newsom buttering up his 2028 Democratic presidential primary bid by cozying up to the entertainment industry's elite and their fat-cat donors.

Why would Newsom be interested in a niche industry like Hollywood when California's finances are in shambles? The answer is as clear as a Hollywood blockbuster: power and influence. The film industry is not all about films; it's a gold mine for celebrity endorsements and campaign funds. Hollywood glamorous gala attendees and Oscars after-parties are the same moguls and celebrities who fund Democratic campaigns and share their messages with millions. Newsom, a lame-duck governor with presidential aspirations, knows full well that gaining the support of this crowd would be invaluable in a contested primary. His $750 million tax break isn't an economic policy; it's a Valentine to the rich and famous of Tinseltown, designed to capture their hearts and wallets in 2028.

This move reeks of cronyism. While Californians live their lives, they face rising costs and a stressed public sector, but Newsom wants to flood a lucrative business with subsidies. Studies show that these tax credits very rarely pay back the economic dividends promised and instead cost states more than they generate. The Legislative Analyst's Office has concurred with this assessment, further noting that film incentives have a limited impact on stimulating the California economy and workforce. But Newsom continues, undeterred by a $12 billion budget deficit. It is not leadership; it is a gamble taken to further one's ambition at the expense of the public.

Worse, this subsidy forces taxpayers who enjoy no such beneficence to subsidize an industry that does not require them. Every dollar sent to Hollywood is a dollar taken from a modest taxpayer struggling to stay afloat. This type of special tax break is corrupting, rewarding politically well-connected industries while the rest of us bear the brunt of the burden. It's a rigged game where the well-connected win and the rest of us pay.

And a special note to Republican state legislators: have the courage to oppose Newsom's self-serving $750 million Hollywood tax credit. For many years, a lot of Republicans back these credits, bailing out elitist leftists who mock your values every time there's an Oscar or Emmy night and produce material that's the antithesis of the wholesome values that make America great. Hollywood's blacklist stifles contrary opinions among actors and directors. Assembly Republican Leader James Gallagher called out Newsom's proposal as "tone-deaf," a breath of fresh air that the GOP is finally done supporting this terrible policy.

Ultimately, Hollywood's elites overwhelmingly boost the fate of politicians who increase taxes and pile on regulations. If those are the kind of policies they genuinely believe in, let them reap the bitter harvest of their work.