How Govt. Ruined The Movies

[Chris Nuzzaco]

I thought some here might be interested in this article:

http://mises.org/story/3437

During my downtime, I like to use the free online library at the Mises Institute to study up on Austrian economics, banking, business,the monetary system (I run my own business, so this naturally interests me), etc...

Interesting opinions.

 

[Joel Kaye]

OMG. The gov't ruined movies by allowing competition. That article is entirely opinion. He just makes assertions as if they were fact.

The number of great movies produced before the 40s is nowhere near the number of great movies produced after the 40s. A whole lot of crap was made in the 30s and 40s too.

And frankly, for all intents and purposes the major motion picture business currently is a cartel. Try to get wide theatrical distribution without the support of a major studio's distribution arm. I believe it's currently impossible. They own theatrical distribution in reality though they skirt the letter of the law.

If you want to take the position that the Sherman Antitrust laws are no good, fine... you might like Saudi Arabia better than America though. And there would be no RED camera because there would have long ago been formed a "Movie Camera Cartel with a closed distribution system" - which would be terrific for consumers. And there would have been no Oakley sunglasses for the same reason.

 

[Gavin Greenwalt]

I agree. Technology ultimately did more to open up the studio system than the government.

Although personally I kind of like the idea of the old studio system. Instead of a free for all it was more like regular employment. Let people focus on doing what they're good at: making movies instead of fighting the rat race that is freelance work and agents.

 

[Chris Nuzzaco]

Anti trust laws do not open competition, they stifle it. Think about what anti-trust really is: its closing off areas of the free market to enterprises. How on earth is that supporting competition? True competition has not govt. restrictions. "Monopolies" are an interesting thing, who on earth forces you to watch a movie when you can go watch TV, read a book, or ski? When TV starts stealing movie box office receipts for example, that "cartel" won't last long, in fact it can open a chance for someone else to come in and take over by producing better films. A pure free market is 100% competitive.

 

[Chris Nuzzaco]

I agree. Technology ultimately did more to open up the studio system than the government.

Companies like RED are great examples of free the free market in action, not a great example of govt. intervention. Seriously. Look at it, its pure competitive force changing the market, not some lawmaker in DC. Would you be happy if the govt. said Red couldn't leap into the stills market? How about a ban on direct sales because it "hurts" distribution stores (thus raising the price of Red products, possibly putting them out of your reach)? Believe me, I could go on and on about how people who demonize free markets and free society are constantly benefiting from it, yet not realizing. Ironic.

 

[Liam Hall]

A pure free market is 100% competitive.

No it's not. Quite the reverse. Look at the music business; it's littered with companies that were bought up by the majors because they were taking too much market share.

 

[M Most]

Anti trust laws do not open competition, they stifle it. ... A pure free market is 100% competitive.

Well, then, I hope you're happy with the ultimate result of a "pure free market", which is the global meltdown we're now in the middle of.

Capitalism is a system that is deeply steeped in the most primal of human tendencies - greed. Unfettered greed leads to a situation in which a very few big dogs become the biggest dogs on the block, and ultimately wipe out everyone else. That's how we got to where we are. Every major industry is basically controlled by no more than 3 companies - and in some cases, those 3 companies are, shall we say, closely cooperating with each other. That's how you get to the point where companies are "too big to fail." And that's how you bring financial ruin.

I really don't know how you can say what you just did at the very moment in history when we're seeing blatant proof of just how wrong it is.

 

[Chris Nuzzaco]

I must add, to keep a balanced view of things, that there are many powers granted by govt. to companies that do NOT occur in a natural free market. A great example is the ability to incorporate and essentially not be personally responsible for a companies actions, even thought the human owner(s) makes them.

Just some food for thought.

 

[Chris Nuzzaco]

Capitalism is a system that is deeply steeped in the most primal of human tendencies - greed.

And somehow big government is devoid of greed?

 

[Chris Nuzzaco]

Well, then, I hope you're happy with the ultimate result of a "pure free market", which is the global meltdown we're now in the middle of.

I can't resist responding to this. We DON'T have a pure free market, we have aspects of it, which is very different from what you assert. Look, the issues we face are huge, and you can't just look at one part, you have to see the big picture. Govt. is the reason were here. Why? Here's a major reason: Govt. currently controls the money supply (The Federal Reserve), that comes with enormous powers. Think about that. Ever hear about economic "bubbles"? The root cause is always some form or govt. manipulation of the markets via the money supply, it could be artificially low interest rates, inflation, even a made up cause influencing a miss allocation of resources. In the end, these melt downs are actually the free market fighting back, its called a correction. Corrections can be painful events, I don't hide that, but the need for correction was caused by govt. manipulation in the first place. I'm not a "corporation shill" either, even companies are to blame, but its because of the unnatural powers govt. grants them. No matter how you look at it, you always wind up at the same spot, which is govt. being the root cause. I could go into more detail (I've done a lot of study to say the least), but I digress.

 

[jpp]

No matter how you look at it, you always wind up at the same spot, which is govt. being the root cause

The "government" you decry reflects the will of business interests. It make no sense to insist on a distinction between government and the monopoly financial institutions you prefer not to regulate. Look at the Federal Reserve Bank of NY, for example, which was asleep for the last few years, with disastrous consequences. The so-called "public representatives" were all CEOs who were cashing in on the securitization boom. And Goldman Sachs has had a lock on the Treasury department for years, which was also cashing in. This is what the so-called free market provides.

Libertarian paradises may be grand in theory, but you need only refer to the "business climate" in third world nations, where lassez-faire economics naturally plays out. Not many people would voluntarily live under such a system, which is probably why Grover Norquist and William Kristol don't move to Nigeria or Guatemala to enjoy the good life. Far better to be employed by the Republican welfare system for failed prophets and politicians, who can always count on a job with Rupert Murdoch or one of the billionaire-endowed think-tanks, where they can promote imaginary free-markets while remaining immune from the consequences.

 

[Tom Lowe]

The Mises Institute is a tremendous resource online. I often download their audio of speeches and conferences, and listen on my ipod when I'm camping or whatever.

If anyone is interested in learning more about economics, this speech by Peter Schiff to the Mises Inst below is an entertaining and enlightening one:

http://www.youtube.com/watch?v=EgMclXX5msc

It will certainly dispel any myths about the meltdown being caused by "pure capitalism."

This article on Hollywood is sort of a mixed bag, though. On the one hand, I agree that busting up the studio's control of its own theaters was probably unnecessary and most certainly harmful to the studios. But then the author gets into a bunch of nonsense about "community decency" or whatever. I have no time for people decrying a lack of "moral values" in films. That should be left up to us, the viewer, to decide.

The quality of movies has gone downhill for one reason -- the audience has poor taste, IMO. When "Big Momma's House 2" drove a good movie like "The New World" out of my local theater, that tells me that the average viewer wants stupid movies, not quality.

It's interesting that HDNet is sort of reviving the old studio system with their films -- which are financed and produced by HDNet, then screened on HDNet cable assets and their own theaters simultaneously.

 

[M Most]

I could go into more detail (I've done a lot of study to say the least)

Maybe so. But it doesn't mean your conclusions are correct.

There's theory and there's stark reality. The deregulation/small government push that started with Reagan and has continued through 3 other administrations has resulted in a rather catastrophic failure, not a minor correction. The notion that eliminating regulation encourages competition has proven to be completely false in practice, allowing the biggest players to become essentially the only players. This has occurred across many industries, not just the financial services industry. The most famous antitrust action in US history was the breakup of AT&T, which, although it had its social downside, resulted in competition in the communications industry that lowered prices to consumers by a vast amount. And now, gee, guess who's back. And bigger than they ever were. Let's see how that works out over time.

You can believe what you want. So can I. Clearly, you will never convince me of the truth of your argument. And vice versa.

 

[jpp]

The TV networks are a surviving cartel, and not many would point to network programming as a measure of the excellence of monopolies.

HDNET is an interest example: hard to know whether, ultimately, this development is good or bad. One thing we can say, however: Mark Cuban is not a David Selznick. It's hard to see how a visionless company is going to save the world. The fact that he owns the only indie movie chain in the country can't be encouraging.

 

[Tom Lowe]

HDNet is only a partial resurrection of the big studio system in their heyday. HDNet does not control actors or crew under long-term, exclusive contracts. It would be extremely difficult to revive the full system.

 

[Chris Nuzzaco]

The Mises Institute is a tremendous resource online. I often download their audio of speeches and conferences, and listen on my ipod when I'm camping or whatever.

If anyone is interested in learning more about economics, this speech by Peter Schiff to the Mises Inst below is an entertaining and enlightening one:

http://www.youtube.com/watch?v=EgMclXX5msc

It will certainly dispel any myths about the meltdown being caused by "pure capitalism."

This article on Hollywood is sort of a mixed bag, though. On the one hand, I agree that busting up the studio's control of its own theaters was probably unnecessary and most certainly harmful to the studios. But then the author gets into a bunch of nonsense about "community decency" or whatever. I have no time for people decrying a lack of "moral values" in films. That should be left up to us, the viewer, to decide.

The quality of movies has gone downhill for one reason -- the audience has poor taste, IMO. When "Big Momma's House 2" drove a good movie like "The New World" out of my local theater, that tells me that the average viewer wants stupid movies, not quality.

It's interesting that HDNet is sort of reviving the old studio system with their films -- which are financed and produced by HDNet, then screened on HDNet cable assets and their own theaters simultaneously.

I agree, it is a bit mixed bag on the content thing, but still, what I find ironic, is that those who oppose govt. censorship of ideas and morals are ok with what is essentially "economic censorship" (anti-trust). I have read the rebuttals, and they are full of myths, etc. It's hard to address all the flaws I'm seeing and not write a book here on the forum, as the rabbit hole goes VERY deep. I'm sure you know what I mean Tom!

 

[David Rasberry]

I miss the small art house cinemas that proliferated during the 70's, but were essentially locked out of distribution by the studios and the large multiplex chains for first run films and wound up going bust. Now we have 50 screens in town all showing the same 8 to 10 major releases with little variety.
Hopefully with Red Ray and the ever dropping prices for decent HD projectors we may see a whole different distribution model emerge for indies. But public (bad) taste is still the lowest common denominator determinant of what succeeds.

 

[Chris Nuzzaco]

The TV networks are a surviving cartel, and not many would point to network programming as a measure of the excellence of monopolies.

I addressed this earlier. If a so called "monopoly" fails its customers, it FAILS, as in it looses the customers, and could go out of business. This aspect alone really tears up the argument that monopolies even truly exist, as the traditional view is that they cannot be beaten, never go out of business, never ever have competition, etc. In reality, there has never been an example of a big company having 100% market control. How does a "studio monopoly" have control over, lets say, all entertainment? They don't. Options always exist. Go play chess, watch youtube videos of people walking into walls, shoot your own movies even.

 

[jpp]

If a so called "monopoly" fails its customers, it FAILS, as in it looses the customers, and could go out of business.

You mean like Microsoft, which has been failing its "customers" (read: prisoners) for years? Or a bank which pays 1% on a 3 year CD, but charges 30% on credit card interest?

 

[Chris Nuzzaco]

You mean like Microsoft? Or a bank which pays 1% on 3 year CD, but charges 30% for credit card interest?

Do you use a Mac? I use a Boxx PC and run Ubuntu Linux. I hear Google employees all use a custom flavor or Ubuntu Linux. And your point is?

If Microsoft has not fallen down yet, maybe, JUST MAYBE, they are doing something right and able to retain customers because of it. Ever hear of their new OS Windows Seven? It's a response to the abysmal failure of Vista, and you could have beta tested it for free a few months back.

Who's forcing you to buy crappy CD's or not pay your credit card on time?

PS: The reason you would want to buy a CD is to fight inflation.. oh wait... hold on... our government creates that inflation via the the Federal Reserve. Well then, makes you think. I don't mean to sound like a punk or anything, but sometimes this rabbit hole and the terrible misinformation about our monetary system just get under my skin.