February 19, 2003

Blame America

“You see that yellow over there? That’s a problem.”

The writer squinted and looked in the direction producer Paul Maslansky was pointing. Down the street in the Toronto neighborhood he could see a convenience store that indeed had a bright yellow border. Otherwise, it seemed quite ordinary.

Almost two decades ago Maslansky, a producer with dozens of credits on studio and independent programmers that benefited from some off shore tax shelter, was knee-deep in the silly antics of the first Police Academy. Though set in an unnamed U.S. metropolis, budget had dictated filming in Canada (at the time the Canuck buck was trading at 82% of the American dollar) and the current irritant for him was the colored sign. He moaned that the particular hue was only found in countries of the British Empire.

While the presence of U.S. productions filming in Canada was not novel back then, it was nonetheless unusual. Maslansky pooh-poohed the notion that it was simply to save a few shekels. What the favorable exchange rate offered, he said, was the addition of four to five shooting days - critical to having the time to get it right.

In the intervening years, the trickle of what has become known as “runaway” production has intensified to a point that some identify as a flood. According to some self-serving studies, billions are lost annually in wages and services. Other, equally self-serving reports, peg the exodus to as low as 2% of the yearly output of the American film industry.

Regardless, it has evolved into saving more than a few shekels or gaining a couple of days on the set. Just a couple of years ago, I ran into producer Jon Davison who was preparing to film The 6^th Day with Arnold Schwarzenegger in Vancouver. He admitted that he was skeptical that filming in Canada would result in significant saving when the production company brought it up as a condition. However, following several reckies to possible North of the border locations, and factoring in monetary exchange and Canadian tax incentives, he was stunned to discover the movie could be made with a savings in the neighborhood of 33% to 40%. Similar cost conscious moves have propelled U.S. filmmakers to Australia, New Zealand and Eastern Europe in recent years.

The situation has been a hot button issue, particularly for technical and craft people residing in Southern California. About a year ago, an incensed art director told me he was collecting money for the Quebec Separatist Party as payback for the awful toll Canada had inflicted on the film industry. I told him he was fighting the wrong enemy.

What he didn’t want to hear was the notion that the villains weren’t wearing toques and eating back bacon. The fact of the matter is that the flow (or torrent as some want to believe) of production filming and sometimes doing post-production in foreign climes is being done with the compliance and assistance of studio and network executives. The representative of the Motion Picture Association of America in Canada lobbied hard for several years to convince federal and provincial leaders to maintain tax breaks for U.S. productions that have resulted in untold millions in savings for films and television shows in the past five years.

One Canadian politician assessed the situation as the country finally being paid back in small kind for all the money its moviegoers have pumped into the American economy for close to a century. Historically, the Hollywood moguls (many Canadian-born) were keen, even avid, in containing the possibility of a Canadian feature film industry. When Canadian government officials came knocking on the doors of the studios for assistance in making movies back in the 1930s, an unusual deal was struck. Dubbed the Canadian Co-operation Project, it was designed to save its Northern neighbors millions in production costs. In exchange for sticking to documentary and short animation production, the American majors would occasionally shoot a film in Canada and hire a technical advisor whose job was to insert Canadian reference into American movies. Such lines or interjections as - and I’m not making this up - “it sounds like a Canadian swallow to me” and “I think he has a sister up in Winnipeg” crept into Anthony Mann westerns and Errol Flynn potboilers. These bon mots were deemed fair exchange to stave off potential competition for screen time from (shudder) a Canadian movie industry.

Some 35 years since the Canadian Film Development Corporation (now Telefilm Canada) was established to foster feature films, indigenous movies now account for roughly 4% (double that in Quebec) of Canadian box office. Some threat!

So, what makes the “Canadian situation” intriguing and unique?

It should be understood that the movers and shakers of the American entertainment sector didn’t simply wake up a decade ago and discover that there were real economic and political incentives to making movies and TV shows well beyond its geographic borders. As sterling and ruthlessly effective a job as the MPAA has done to foster favorable trade and tariff arrangements around the globe, its members have still had to grapple with such issues and realities as frozen assets, levies and quotas. Sometimes simply making a film in Yugoslavia has been the simple solution to revenue that would otherwise be seized by the local government.

In the 1960s, virtually all the majors staked out territory in the U.K. to cash in on a favorable tax and quota environment. However, when the British government decided the invasion was more exploitive than beneficial and wanted to change the rules, the Americans - save for Stanley Kubrick - picked up the ball and moved the playing field. Other opportunities would pop up from time to time in Italy, Germany, South Africa and other distant venues. Invariably they provided windows of opportunity for several years before being shuttered.

The on-going affair with Canada has vitality and longevity that gives a chaste demeanor to earlier relationships. Barring an unforeseen rally in the strength of the Canadian dollar there’s scant likelihood of the relationship souring any time soon.

But the strength of the liaison goes well beyond favorable monetary exchange and tax benefits. Add to the stew such niceties as comfort and quality. Filming in Canada requires no inoculations, language interpreters or radical cultural changes. One can sleep in a Howard Johnson’s and watch American television as easily in Moose Jaw as Omaha and the Chinese take-out is considerably better. There are excellent labs and top-notch crews if you plan well in advance of shooting. It is true that the influx of production was well beyond the capacity of the trained work force and I’ve yet to encounter a filmmaker who hasn’t experienced a degree of inexperience that’s cost him time or money.

To use an over-used term, co-dependency is implicit in the relationship between the U.S. majors and fledgling Canadian film entrepreneurs. For some it’s a win-win situation but no union is perfect. Some Canadian artists and technicians are reaping honors and rewards from this association and that and the economic boost to the sector appears, for the nonce, to satisfy the absence of investment or assistance to culturally Canadian production

Should the Canadian government re-examine the alliance? Probably … but it’s unlikely. The gold rush atmosphere is still very much in evidence and, as with most euphoric periods, it’s simply too painful to contemplate the inevitable time when everything’s been mined out.

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