California moves to hold onto Hollywood

Gov. Arnold Schwarzenegger (R-CA) is trying to stop film and television production from leaving the state. Billions are at stake, and not just for the upper echelons of the film industry - the actors, directors, producers. In the past few years, as the US has seen millions of jobs move offshore to other countries, California's multi-billion dollar film industry has been socked by major film production moving to states such as New Mexico, Louisiana, and Michigan as well as to Canada and Australia, all of which have offered tax incentives to lure film production. Losses from these moves have been estimated to reach about $10 billion per year. The state's refusal to play the subsidy game changed last week when Gov Schwarzenegger signed a budget bill that included $100 million a year in tax credits for the industry for so-called below-the-line spending, which are payments to crew members other than the main stars and filmmakers.