Think of this as Volume 18, Number 44 of the newsletter I have written weekly since March, 1997. Enjoy.
When I was a kid, I was taught that Georgia’s nickname was “The Empire State of the South.”
Back then Georgia had an umbilical relationship then with my home state, New York, the original “Empire State.” Georgia, and the states around it, were where New York outsourced manufacturing that required large amounts of labor. Georgia was the original India.
Back in the 1950s the South was filled with textile mills of all kinds, and Atlanta was the regional center to which all those plants reported. One reason the Atlanta business community was so anxious to do business with this city’s black leaders, and advertise itself as “the city too busy to hate,” was to protect that relationship with New York, which didn’t much care for overt racism. For all his faults, the original John D. Rockefeller believed in racial equality. His wife was the Spelman of Spelman College. And throughout the years of my upbringing our governor was Nelson Rockefeller, a grandson of John D.
Of course, even at that time the relationship was fraying. Outsourcing to the Far East had already begun in the 1950s, and by the 1960s it was becoming a flood. Textiles and clothes, those industries where labor was the biggest factor in production costs, were among the first to go. One by one the lights were turned off on Georgia’s textile mills. Georgia tried to stop it. Even after I moved to Atlanta, in the early 80s, the industry’s Bobbin Show was still a very big deal on the convention calendar.
But it was inevitable. The plants are now all gone. They’re shells. If they’re lucky they’ve been converted to condos. If not they have been torn down.
The point of all this history is that Georgia is in the process of making the same mistake again. Once again, the promise of “jobs,” especially jobs that start with a minimal skill level, is trumping common sense.
Only this time the industry in question is the film industry.
Georgia’s film industry was born with “Deliverance,” in the 1970s. Its history made it the perfect place to film “Driving Miss Daisy” in the 1980s. But now, driven this time by a 30% tax credit, film makers are abandoning California in droves to turn Atlanta into all sorts of places. We played Denver in the film “Identity Theft,” for instance. We’ve played many places in the “Fast & Furious” series. On a walk a few years ago I saw that the old Pullman Yard near my home had been turned into a set for the second “Hunger Games” movie. Last year they did it again for the third installment.
Now anyone with a big piece of unused real estate thinks they can turn it into a movie studio and promise jobs, jobs, jobs. Tyler Perry is taking over the old Ft. McPherson. Screen Gems is taking over the olds Lakewood Fairgrounds. There’s a bunch of real estate guys turning the old Shannon Mall into studio space, the land behind the old AT&T fiber plant in Norcross was turned into a studio, and a beer distributor just decided to turn his old warehouses into studios. The industry will spend an estimated $5.1 billion in Georgia this year.
New York is moving Hollywood to Georgia for the same reason it moved textiles here a century ago – tax credits and cheap labor. There is nothing permanent to any of this. If someone else offers a 40% tax credit they’ll be out of here tomorrow. If it becomes practical to produce movies in Mexico or the Dominican Republic they’ll move out of here in a heartbeat.
Right now, however, politicians and the local industry are busy patting each other on the back. Never mind that Georgia’s unemployment rate is now the highest in the nation, a product of inferior schools and thus inferior skills. Tomorrow never comes to these folks.
There are some things that can and should be done to prevent this.
First, we need some serious film education. Atlanta Tech is getting some courses that focus on the low-wage end of the business, but we need a lot more. We need a university to become as big in film and entertainment education as USC is. That means the sector needs to give back in a big way, and that needs to start now. My best guess on where to situate such a curriculum is Emory University, although Georgia State would also work. Or the writing and creative side could go to Emory, the technical and technological side to State.
Second, we need a center. That means more than a studio. It means flexible offices where all the major studios – the film studios, the TV networks, the cable networks and the over-the-air folks – can do their deals. We’re closer to New York than California is. Why are finance people flying 4 hours each way when they can come here and be in their beds the same night? If you need the creative folks who live out there and won’t fly, we’ve got video conferencing. It’s getting better every day.
Third, we need a tourist attraction. I’m talking about museums for film, along with sound stages you can actually look down on to see real productions actually being produced. I’m talking about theaters that can host big events, yes even the Oscars themselves. And that can’t be out in south Fulton or Gwinnett Counties. It needs to be something you can get to and get out of quickly. A center.
Finally, we need big producers. Producers make the deals, and producers make the decisions. They have to actually live here, do all their business here. If Atlanta wants to be more than a branch office to New York and Hollywood we need to compete with them, directly, on their own terms. Not just on wages and taxes, but on quality, and on resources.
There are now many, many markets for filmed entertainment, far more than Hollywood can handle, and many which demand the lowest possible cost structure. The big studios still exist. So do the big TV networks, and a host of cable networks. But there are also “over-the-top” studios like Amazon, Netflix and Hulu. There are markets for music videos like Google’s YouTube. Video games are increasingly driven by video rather than gaming.
Atlanta has a ton of music now. We have a history in TV, even though Time Warner has mainly pulled out. We’re making a few dozen films a year. But we’ll never be more than a branch office until we get over the branch office mentality.
Can it be done? Well put it this way. The New York Stock Exchange building is just a cable set. The real action is in New Jersey, and the owners? They’re up on I-285, in Atlanta. They figured out that the whole stock industry is just transaction processing, they built a good system, and they finally brought ownership of the whole market down here.
If you really want to grow the film industry in Georgia, we need that kind of gumption, and that kind of big thinking. Right now I don’t see it. But tomorrow is another day.
