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'Runaway' strain in Hollywood
Newsflash: 'America is under attack. Not from Osama bin Laden, but from our peaceful neighbours to the north'
Matt Welch
National Post
Arnold Schwarzenegger may find using his lobbying muscle to protect the Hollywood film industry is a good political move.

LOS ANGELES - The Canadian film industry dodged a bullet three weeks ago, though few seemed to notice.

The California Legislature, hacking through hundreds of last-minute bills to finish a budget that was already a record two months late and a boggling US$24-billion short, quietly killed a ballyhooed proposal that would have handed Hollywood $650-million in taxpayer bribes to resist the midnight urge of "runaway production."

The measure, had it passed, would have given U.S. producers of movies with budgets under US$10-million a 15% tax credit on the first US$25,000 of each employee's salary, as long as half the film was made in California. The Canadian menace, at last, was going to be faced down.

"Hollywood is under siege and we have to come to their rescue," Gray Davis, the Governor of California, bragged to a film-union audience back in January, when he noisily unveiled the "Davis Plan" for movie production subsidies. "We will enact this bill," he assured The Hollywood Reporter as recently as July 12. "I will sign it.... Our bill will become law."

That it did not shouldn't come as any kind of surprise. Whenever U.S. politicians mix it up with the state's US$30-billion motion-picture industry -- especially during an election campaign, such as the high-profile contest Davis faces this fall -- the ratio of rhetorical hot air hot air