As Hollywood prepares for an era of new political pressures under Donald Trump’s return to the White House, the Motion Picture Association (MPA) extended congratulations to the president-elect, signaling their commitment to work with the administration on behalf of the entertainment industry. Representing the collective interests of major studios, the MPA noted the essential role of film and TV in supporting 2.7 million American jobs, 240,000 businesses, and over $242 billion in wages across the U.S.

But as the industry wrestles with what Trump’s presidency could mean for production and policy, there are looming questions. While the MPA’s message championed the industry’s economic impact and praised the democratic process, it comes on the heels of years of skepticism Trump has cast on the very institutions supporting democratic integrity.

With mounting global competition for content production, California Senator-elect Adam Schiff has proposed a federal tax incentive to keep productions at home, appealing to the Bureau of Labor Statistics for data on how foreign incentives impact U.S. production. His call reflects an urgent effort to create a federal film incentive that can compete with highly attractive programs in countries like Canada and the U.K., which continue to lure projects away from the U.S.

The Economic Stakes of Production Incentives

Tax incentives have long been a cornerstone of attracting and retaining film and TV projects domestically. California Governor Gavin Newsom recently announced his push to raise the state’s film and TV tax credits from $330 million to $750 million—a move aimed at keeping Hollywood competitive amidst a contracting production landscape. With international locations like Toronto, London, and Budapest enticing American studios through generous tax schemes, a federal incentive could be a game-changer for the U.S. entertainment industry. However, gaining support from a Trump administration may be an uphill battle.

While Trump once built his fame within the entertainment industry, he has often clashed with “liberal Hollywood.” If past tensions are any indicator, Trump’s administration may be slow to prioritize or support policies that would directly benefit the California-based entertainment sector. Yet, the impact of such support would reach far beyond Hollywood, stimulating economic activity and job creation in cities and towns across the nation.

The Cost of Competition

Global competition in film and television production isn’t only about location but about the economic incentives that drive decision-making. When considering where to film, studios weigh factors like talent availability, production infrastructure, and, increasingly, tax advantages. Productions can yield millions in local spending and job creation—benefits that states and countries are keen to capture.

Trump’s inclination toward tariffs and trade restrictions could add a layer of unpredictability for an industry already feeling squeezed by the post-pandemic economy and strikes that rocked Hollywood in 2023. In the past, U.S. productions were hit by strained relations with China, a major consumer and distributor of American films. Analysts warn that, should Trump reignite trade tensions with China or other nations, Hollywood could face yet another barrier to reaching global audiences, further incentivizing studios to shift work to countries with more stable policies and favorable incentives.

MPA’s Strategy: A Balancing Act

The MPA’s congratulatory message to Trump highlights Hollywood’s pragmatic approach. While the industry may not agree politically with the incoming administration, economic realities dictate the need for a collaborative approach. “We look forward to working with them on a wide range of important issues for the film, TV, and streaming industry,” the MPA stated, underscoring Hollywood’s readiness to adapt, even as it continues to advocate for growth opportunities in an era marked by political uncertainty.

The MPA has focused its lobbying efforts on promoting and expanding state production tax credits, a tactic proven to boost local economies and job creation. The question remains whether these efforts can gain federal traction under a Trump administration, which may or may not see eye-to-eye with Hollywood’s objectives.

What’s Next for U.S. Productions?

As Hollywood grapples with the shifting political landscape, the calls for tax credits are becoming more urgent. Productions now face a landscape where streamers and studios, under constant financial pressures, seek out the most cost-effective and politically neutral locations. Conservative markets like Georgia and Texas, which offer robust tax incentives, continue to attract productions that once stayed on the West Coast.

Looking ahead, it’s clear the U.S. production ecosystem will be profoundly shaped by these evolving dynamics. Hollywood’s fate may depend not just on the administration’s policy choices but also on its response to an increasingly global, incentive-driven industry. And with the MPA leading the charge, Hollywood’s message to Washington is clear: this isn’t just about California; it’s about a national industry that fuels millions of American jobs and holds significant cultural influence worldwide. The world will be watching as Trump’s administration defines its stance—and Hollywood, as always, will be ready to pivot.