Hollywood drew my attention last week in two ways—one catastrophic, one hopeful. First, the catastrophic: Trump has announced 100% tariffs on foreign movies.
Hollywood seems to be treating this declaration as a curiosity, or like “Here Trump goes again, eye-roll emoji.” But tariffing services is a cross-the-rubicon moment for the global economy. A few inconvenient facts:
There’s no way to do a movie tariff that would make sense;
Most of global productivity is in the service sector and tariffs on services would reduce global demand for…services (thus accelerating a crisis of capital accumulation); and
Hollywood is not a profitable industry for venture capital. It has been a shrinking industry, and foreign films are NOT the reason why. In fact, foreign film industries’ specialization in parts of the movie production process helps reduce the cost of Hollywood filmmaking.
Prior to this moment, Trump’s tariff regime was cosplaying nationalist autarky. He seemed to want to trap Americans inside a great MAGA firewall, but he wasn’t trying very hard. The tariffs were merely using bilateral trade deficits as an excuse to setup an extortion racket to punish enemies and extract tributary payments from ally governments. The tariffs have been and will continue to be an albatross on the economy—just ask American soybean farmers. But the tariffs were on goods, not services, meaning that global financial capital was largely exempt.
Depending how a 100% service tariff is implemented—and I must stress that there’s no sensible way to do it1—it would amount to a war on the entertainment industries in friendly countries (specifically New Zealand and South Korea). In a place like New Zealand, cutting off their visual effects and film sector from US movie production would induce an economic recession.
But film tariffs would also set a precedent for tariffing any other service, which would be a death sentence for capitalism as we’ve known it. All else being equal, that might be worth celebrating…but all else is not equal.
Financial capital comes to occupy the largest share of economic productivity during cycles of low and declining growth—this is part of how capitalism manages the crises it produces. If you disrupt the global service economy without some kind of profitable substitute, then the world-system quickly becomes a more brutal anarchy than anyone alive has ever known.
MAGA either doesn’t understand the consequences of what it’s doing or it doesn’t care. Far right political movements are not good at economic analysis, but even if they were, they’re not exactly invested in the global implications of their nation-centric ideology. That matters in this case because it’s not hard to think of scenarios where the movie-tariff idea helps usher in a global recession.
Economic catastrophe would, of course, be good for the global far right insofar as states use crisis as an opportunity to harden borders, discipline workers, purge minorities, and expand collusion between the state and private capital interests. So maybe movie tariffs are good for Trump after all…
Jane Fonda has re-launched the Committee for the First Amendment, a network that her father started in 1947 to counter the anticommunist hysteria that gets popularly remembered as McCarthyism. In Hollywood, that moment found its worst expression in the notorious “Black Lists”—a term that used to incite great fear but which in recent years got inverted.
That red scare, which was the second in 20th century America, was an unmooring of the repressive power of the state from reality. Conspiracy theory and right-wing ideology became justification for the national security state to purge workers from government, from organized labor, and from the film industry. Politicians didn’t just refuse but actively policed the civil rights and feminist movements—delaying by decades the progress they represented—on the accusation that anyone agitating for equal rights was a communist in disguise.
We’re obviously living through such a moment again, but on steroids, powered by AI, and without even the pretense of a communist enemy to justify any of it.
Fonda talks about the new Committee for the First Amendment with Democracy Now! (transcript here, video below):
There are many open questions about not just what counts as a foreign film but what this kind of tariff is meant to achieve. Is this about banning movies with subtitles, requiring domestic filming locations for all movies, domestically sourcing the production of digital effects, “rebuilding” American cinema, or censoring foreign ideas? Unserious, like everything else happening nowadays, but costly all the same.