Saturday, August 8, 2009

Hollywood is Burning

In 1953 Josef Stalin said that, if the Soviet Union had Hollywood, the whole world would be communist. Well, have Hollywood he did not, for Hollywood had Hollywood. Just as American culture spanned the countries of the globe—what Hollywood insiders termed their ‘territories’—so too did the culture of southern California. Sunny days, warm watered beaches, girls in skimpy bathing suits and that catchy, infiltrating slang inundated cinemas the world over. Be it the increased sales in hitherto unneeded household appliances, makeup and automobiles, which swept Europe in the post-war years, or the many other cultural nuances attributed to Hollywood film, southern California left its mark on the global brain.

But the current financial crisis—and impending societal collapse in the US—threatens Hollywood’s hegemony over the celluloid screen.


  1. As inventor and independent financial analyst Max Keiser reported in his blog for Huffington Post, bond trader Cantor Fiztgerald recently filed an application with regulators with the intention of launching an exchange that allows users to hedge and speculate on the financial performances of movies.
    Keiser, host of The Oracle on BBC World and podcast Truth About Markets, predicts that “the Cantor/HSX futures will actually drive the prices of stars, films, marketing and the industry as a whole DOWN:” a topsy-turvy world of rivals selling out rivals and driving down prices—perceptions included—for high prices are good marketing in America. Indeed, Max predicts the Hollywood cartel—at the forefront of the consciousness industry since the 1920’s—will enter into a period of infighting as each studio struggles to be the vanguard of Hollywood. [1]

    The theory of technical primacy encapsulates the importance of Hollywood, arguing that Hollywood—a comparably new innovation in the arsenal of imperialism, especially leading up to and after World War II—played nearly as important a role as military and economic forces in bringing about allied victory during World War II.

    For example, immediately following the attack on Pearl Harbor, the war became one of the most frequented subjects of the U.S. motion picture industry: from 1942 until 1945, out of the 1,700 movies produced in that period altogether, approximately 500 depicted a pro-war stance.

    In fact, the cooperation between Washington and Hollywood’s War Activities Committee in the face of international conflicts was so penetrating, that few agencies within the federal government were not represented by Hollywood, the White House included. Demonstrating symbolically the importance of this relationship, was the U.S governments approval of something like 4,000 members of the U.S. Film Industry—directors, studio bosses and sales managers—to wear military officer uniforms. In reality, the military has been deeply involved with the film industry since the Silent Era.

    Hollywood represented a new form of imperialism, not in idea or intent, but rather in effectiveness. It penetrated the public’s consciousness and reoriented social values, as demonstrated by the aforementioned change during the 1950’s in European consumer habits.
    The brain is infinitely more advanced at synthesizing data than modern computers. The cornucopia of modules responsible for the gross sum of our realities, nonetheless, functions largely at the realm of the subconscious. In other words, upwards of 90% of our daily experiences are understood separate from our own awareness. In a speech for the leading managers of the U.S. film industry on November 5, 1961, Edward R. Murrow quoted Carl Sandburg:

  2. "I meet people occasionally who think that motion pictures, the product that Hollywood makes, is merely entertainment, has nothing to do with education. That’s one of the darndest fool fallacies that is current...Anything that brings you to tears by way of drama does something to the deepest roots of your personality. All movies good or bad are educational and Hollywood is the foremost educational institute on earth, an audience that runs into the estimated 800 million to a billion, What, Hollywood’s more important than Harvard? The answer is, not as clean as Harvard, but nevertheless, farther reaching."

    Others echoed this disposition:

    "The film is to America what the flag was once to Britain. By its means Uncle Sam may hope someday, if he be not checked in time, to Americanize the world." –warning by London Morning Post in 1923.

    "If one were to write the history of economic imperialism, the American film production would be one of the most interesting chapters." –Rudolf Oertel

    In a study for the State Department, the Institute of Communications Research recommended the liberal use of film, stating: Films are especially suitable for unsophisticated audiences…it makes no difference what we have to show them. You will find this true almost anywhere except perhaps among intellectual groups where they are blasé about it. There is a fascination that films have for people. Even among intellectuals there, they come to be critical…You can do anything you want to them (sic) as long as you don’t drive them away.”

    There is a multitude of ironic motifs teased easily out of Hollywood films of the 1950’s, many of which not so different from the recurrent themes of Nazi cinema. An internalization of self-censorship as a result of the McCarthy show trials in the 1950’s sent Hollywood film dollars to politically safe westerns, all-encompassing of subtle allusions to a slimy, collectivist red menace.
    Hollywood had mustered so much clout, that the industry could dictate the movies of other countries. In Germany, for instance, Hollywood blocked the subsidizing of the German film industry after the war, a once formidable competitor. Due to widespread devastation in Europe and much of the world after the Second World War, Hollywood had secured a dominant position as the bedrock of the global consciousness industry. In fact, the dominance of the Hollywood cartel was so widespread, that it wholly negated the undertakings of a free market in terms of cinema.

    The influence of American culture in Europe after the Second World War was enormous—some have referred to it as the new Monroe Doctrine; that is, the Marilyn Monroe Doctrine. The postwar period was a period of huge opportunities for victors, allowing the U.S. to build upon the old European dream of U.S. democracy as a way of life that secured a high standard of living for the masses, and also had the financial means to organize a comprehensive cultural program that embraced all facets of life. One such cultural program, implemented by the U.S., stated as its mission the use of “each material and psychological medium to create respect, even awe in the lifestyle of America, and also to undermine other political philosophies;” and so they did, on up through today. However, representing the power of the consumer, Hollywood did open up its content during the creedal passion period of the 1960’s to reflect the general sentiment of the population at that time, as well as to keep the cash flow coming. Films such as Platoon and Full Metal Jacket portrayed war in a much more critical light than, say, John Wayne films of the 40’s and 50’s.

  3. These days, the Army, Navy, Air Force, Marines, Coast Guard, and Department of Defense occupy entire floors of Los Angeles office buildings so as to ensure films fulfill the agenda of those institutions. In exchange for high-tech, tax payer funded, otherwise unavailable gear, Hollywood allows the military to censor scripts to suit their needs. [2]

    Southern California’s reign as the epicenter of American culture might very well be over. The state of California is shambles, and one of the country’s most populous regions—approximately 24 million people call the agglomeration home—is also one of the most fragmented and therefore compromised, for its ability to act in a unified, cohesive manner, should it need to, is severely limited. The problems facing southern California are multi-faceted, especially when multiplied over all major facets of life—economic, social, cultural and environmental. The five-county region that makes up southern California ought to be watched closely over the next decade, as it very well might serve as an example of what industrial collapse is. That is what this series is about, but first: Hollywood.

    Fittingly, art is imitating reality. A new wave of Hollywood disaster flicks coming this fall reflects the actual position of Hollywood, if not the world. Unlike disaster flicks of the Atomic-Age and Watergate which dealt with the fall of civilization, the new flicks deal with the struggles of post-apocalypse existence. The wave of post-apocalyptic manuscripts is aimed at cinemas and TV screens, where battles with cannibals, the acquisition of survival techniques, and the struggle to keep one’s humanity will be portrayed in stunning detail.

    In January expect “The Book of Eli,” in which Denzel Washington stars as the fierce protector of a book holding the key to mankind’s redemption in an American wasteland wrought by war. NBC’s “Day One” features a gang of neighbors trying to survive and come to terms with devastation and a beyond dilapidated and useless infrastructure. The Film adaption of Cormac McCarthy’s “The Road,” due in October, includes footage shot during recent disasters, such as Hurricane Katrina.

    According to Rob Kutner, writer for “The Tonight Show with Conan O’Brien,” escapism plays a part in the latest glut of apocalyptic cinema, since “people are less concerned about their house being foreclosed when it’s being taken over by mutant appliances.” Perhaps some of these films serve social engineering programs by way of predictive programming.
    By portraying on the big screen a world on the edge, when, in fact, the world is on the edge, engineers in Hollywood predispose audiences to accept extreme austerity and catastrophe, causing them even to expect it, as opposed to sacrificing the crazyquilt lifestyle of society for true human community and overcoming. A process of gradual and subtle inculcation, predictive programming creates an environment in which feedbacks loop of expectations generates a self-fulfilling prophecy.
    Despite the seriousness of the issues tackled by Hollywood this fall and winter, most of the films strive to avoid moralizing the collapse—a tactic that has been historically lethal at the box office.

    What we have in store, according to Roger Smith—an executive at the research firm Global Media Intelligence and a former film executive who oversaw “Terminator 2”—is “the film version of the Cuban Missile Crisis; we have to get the edge of extinction each time.”
    I’d place a bet that, were Hollywood to go bust, the human species would have a better shot at surviving than if not. Indeed, U.S. movie box office grosses for July 31-August 2 were down 21.5 percent from a year ago 21.5 percent, though many Hollywood officials would be quick to deem those statistics insignificant. [3]

  4. Top 12 Films Grosses

    This Week Year Ago Pct.
    (mln) (mln) Chg.
    $113.5 $144.7 -21.5

    With summer blockbuster grosses down, Hollywood continues its struggle to find a place in a digital world that eats old business models for breakfast. In a bid to seek new audiences, IMAX Corp. partnered in June with China’s largest film studio to release three Chinese language movies, representing the first time Imax shows foreign-language films on its giant specialty screens.

    New technologies, venues and business models have both benefitted and hurt those businesses which rely on intellectual-property rights. Hollywood has yet to adequately take advantage of the digital positives, such as marketing and distribution, while prosecuting effectively the negatives—negative, at least, in their view—such as piracy. Prosecuting alleged pirates in a court of law has had mixed results. The MPAA, although less-so than the music industry, has indeed also taken this route, though it in many ways has proved inefficient. “You have to do some enforcement,” says Dan Glickman, chairman and chief executive officer of the Motion Picture Association of America, “but we have to do more than that, and the focus has to be on technological solutions and on doing a much better job educating people about the impact of piracy.”

    Will a Hollywood futures market hasten the loosely knit cartels downfall? Keiser seems to thinks so:

    "Look for studios to sabotage each other’s projects by short selling and ‘naked’ short selling competing projects on the Cantor Exchange to drive the perception of a film’s popularity down before it’s released. No problem, just spend more on marketing. More money will be made trading box office futures than at the box office. Inside information will become legal. Milton Friedman will rise from the dead and advise the Honduran government. Brat Pitt will star."

  5. 1.Max Keiser. Will Hollywood Futures on the CantorExchange Kill Hollywood? Huffington Post, 8 December 2008.
    Available at:

    2.John Jurgensen and Jamin Brophy Warren. Hollywood Destroy the World. The Wall Street Journal, 31 July 2009
    available at:
    3.Lauren A. E. Schuker. Summer Box-Office Sales Cool Down. The Wall Street Journal, 3 August 2009.
    available at:
    4.Lauren A. E. Schuker. Imax Set to Partner With Chinese Studio. The Wall Street Journal, 15 June 2009
    available at:
    5.William Tripplet. On The Future of Movies. The Wall Street Journal, 21 July 2009
    available at:
    6.Max Keiser. Dr. Blankfein Or: How I Learned to Stop Worrying & Love Goldman Sachs, Max Keiser, 2009.

    available at:

    7.Reinhold Wangleitner. 1994. Coca-Colonization and the Cold War. UNC Press, Chapt. 8 The Influence of Hollywood, ibid.