Hollywood Receives Government Help — Why No Salary Caps?

Tinseltown big shots want caps on taxpayer supported Wall Street traders. Why not on taxpayer supported Hollywood machas?

By Dan Gifford
3 Nov 2008

When Uncle Sam fought WWII, Hollywood backed him with patriotic movies 
and war bond drives and moral boosting celebrity appearances. When Uncle 
Sam fought Communists, Hollywood was a mixed bag. His GIs in Korea got 
support. His GIs in Vietnam, not so much, as some damned his war with 
movies of faint praise that depicted Imperialist aggression by ugly 
Americans against peoples who just wanted be free from capitalist 

Hollywood on Uncle Sam’s terrorism fight? Don’t even ask.

But now that it’s Uncle Obama on the warpath against the most diabolical 
villain in the populist panoply, Hollywood is back to showing its 
anti-Axis resolve against this most indefensible of enemies.

That enemy (for now anyway) is the army of the overpaid — those 
individuals who represent an unholy axis of unsupervised greed with 
incomes that evoke envy in the psyche of the ordinary workin’ mench at 
the mercy of The Man. And why not? According to human resources expert 
Patrick R. Dailey, top corporate salaries are now 411 times the amount 
of the lowest paid worker. In 1980, that ratio was 42 to one. By 
comparison, star actors are often paid more than 1,000 times the amount 
of the lowest salary on the set. No matter.

To hear Hollywood multi-millionaires like Oscar winner Michael Moore and 
Emmy winner Lawrence O’Donnell myopically channel Huey Long’s populism, 
highly paid financial industry execs and Wall Street traders are the 
only serpents in the suites, the only rapacious rich for making more 
than the $500,000 annual salary Obama deemed reasonable earlier this 
year for bank CEOs that received federal tax bailout bucks. But that’s 
bound for change.

Pay Czar Kenneth Feinberg says the upper limit will be more like 
$200,000 for AIG’s top people and possibly the others at rescued 
companies if he has his way. Feinberg’s notion is to expand the list of 
the capped and that has members of the chattering class like CBS Early 
Show host Harry Smith openly talking about the next logical step: “Why 
wouldn’t we make this law across the board and put a governor on 
compensation for everybody in private enterprise?”

Keeping in mind that members of said chattering class do not consider 
themselves part of “private enterprise,” its members in good standing 
undoubtedly see their multi-million dollar incomes as exempt from 
limitations. So today, it’s pay limits only for companies that directly 
received taxpayer cash. But tomorrow, could it be any company or 
industry that benefits from special federal legislation — like tax breaks…

Like the tax break Hollywood gets?

Some states give considerable financial help for filming within their 
borders, but Uncle Sam helps the cameras roll too. Films that begin 
production by December 31st qualify for special tax treatments and that 
would be more than enough of an opening for Democratic Congressman 
Barney Frank of Massachusetts to exploit: “We are trying on every front 
to increase the role of government.”

Moore and O’Donnell and their many movie-biz supporters would be fine 
with that for everybody else, but what if that means Uncle Sam also gets 
to cap Hollywood’s gigantic paychecks?

Could Disney’s Bob Iger (30 million in 2008), CBS’ Les Moonves (36 
million in 2008), Time Warner’s Jeff Bewkes (19 million in 2008) or 
DreamWork’s Jeffrey Katzenberg (11 million in 2007) or Lion’s Gate’s Jon 
Felheimer (6 million in 2007) get by on a paltry 200 grand? Or what 
about Cameron Diaz and her reported 50 million income or Simon Cowell’s 
72 million or Will Smith’s 20 million plus per picture or …

They’d all still be “rich” with an income of 200 large, according to 
Uncle Obama’s current rationale, but the gap between above and below the 
line would definitely be compressed, possibly to the point of adopting a 
new compensation model.

While it is true that quite a few of the huge executive pay packages in 
public corporations can be traced to boardroom cronyism which 
shareholders are all but powerless to fight, those maligned bonuses are 
usually paid to people like Wall Street traders or salespeople who have 
to show bottom line results. How would that work here in Hollywood?

Hollywood is now the land of schmooze, off-book arrangements and any 
number of other “things” that most here would not want to tell a 
Congressional investigation committee or the Securities and Exchange 
Commission. But let’s try one measure of pure performance for people 
that may be paid 15 to 20 million or more for a few month’s work.

According to Forbes, The Bourne Ultimatum grossed $29 for every dollar 
star Matt Damon was paid. Jennifer Aniston’s last three starring films 
earned $17 to every dollar she was paid. Tom Cruise, Tom Hanks and Will 
Smith bring in about $12 per every dollar they are paid. And Adam 
Sandler, Will Ferrell and Jim Carrey bring in about $9 for each buck 
they get. Unfortunately, that’s where the simplicity stops.

How many saw The Bourne Ultimatum just because it starred Matt Damon? 
How many saw it because it was a well-written, compelling story that was 
superbly directed and had a terrific actor ensemble ? Would just as many 
have seen it had the film starred somebody else? How much of the credit 
and compensation a star gets is due to other’s work that makes him look 
good? The Wall Street traders now in the class warfare crosshairs have 
no such variables. They either made money or they didn’t. Whether that 
trading helps or hurts people is a subject for another discussion, 
except for one point that appears to be getting ginned up as a Hollywood 
defense against any attempt at exerting Washington control here.

That argument is that what financial industry types do affects the well 
being of individuals and the economy at large, while Hollywood doesn’t 
do either. Good luck with that reasoning to those who think it’ll keep 
them away from the Frank ‘n Feinberg fingers if they start to roam. On 
the other hand, running a riff on that Huey Long legacy might do the trick.

During the 1930s, Louisiana’s Democratic populist Governor Huey Long was 
so dictatorial about wages and most everything else, that Congress 
started to investigate whether his state was still a republican form of 
government as the Constitution required. Long was murdered before 
committee hearings started, but its question about the limits of 
legitimate government control is worth considering.

At what point would Barney Frank’s forewarned government micro-managing 
of America disqualify it as a republican form of government? Wherever 
that point is, it doesn’t necessarily have to crimp Hollywood.

Huey Long has been resurrected as Michael Moore, Hollywood’s 
anti-capitalist Kingfish of compensation, and he’s supported by Lawrence 
O’Donnell and his 99% socialist Writer’s Guild garrison. Together, this 
formidable semantics’ force could clear the way for Frank and presumably 
Feinberg while protecting its own.

How? By doing two things Hollywood does best: using film and television 
to alter a contract –in this case the people’s contract with its 
government — thus creating a false perception that eventually becomes a 
public opinion reality.

In scripts, Moore and O’Donnell could re-write the Constitution’s 
Guarantee Clause to depict pay czar control and other Washington 
dictates to have have always been an integral part of a republican form 
of government. Then they could exempt themselves by turning the Equal 
Protection Clause into a dramatized PETA approved “Napoleon” doctrine of 
Tinseltown exceptionalism reading that all animals are equal but that 
Hollywood animals are indeed more equal than others.

Yeah, it’s a bit of a stretch, but flyover land has been influenced by 
our scripted propaganda for over a century now, so why not again if it 
saves our bacon?

Dan Gifford is a national Emmy-winning, Oscar-nominated film producer
and former reporter for CNN, The MacNeil Lehrer News Hour and ABC News.
Bio: https://dangifford.com/bio/