Warning: I am not a film specialist. I am not an economist. I am not a political analyst. I am a swing voter. I am not political. I am entirely unqualified to advise on any topic. This is not phrased for the sensitive; if you are, please don’t read it. I am not an American, so I read the international news. I may lack some of the finer points in U.S. trade, U.S. politics and U.S. history; my U.S. history knowledge only goes up to September 3, 1783, and at that point, I lose interest a little. Please, as you read this, remember we are each perfectly imperfect.
To those who are chasing authorship, this article is written anonymously. The internet is a cold, hard, nasty place and putting your name on anything remotely controversial is ill-advised. We hope you understand.
As ever the last article led to various complaints. Nothing funny enough to quote here, but keep them coming.
Let’s make a start.
TRUMP
The Potential Impact of Trump’s Tariffs on the British Film Industry
Right, let’s start with Trump. He won. The U.S. needs to get behind him. I would write the same about Kamala Harris; it is over, and you will get your turn again at the next election.
Keir Starmer also has my full support ‘til the next election.
This constant fracture in the U.S. between Republicans and Democrats does you no good. It often has me pondering whether your civil war ever really ended, and maybe that is now just in your bones. Your enemies want you divided, of which there are many; you are playing into their hands. I don’t mind a bit of Trump. He is the daily chilli sauce on my news reading, which makes my day less dull. The fact that we are discussing trade tariffs is a win. Sorry, I’m side-questing.
According to the Oxford Dictionary, a tariff is “a tax or duty to be paid on a particular class of imports or exports.” Tariffs are often used as a means of protecting domestic industries from foreign competition or as leverage in international trade negotiations.
There is no easier way to win an election than on immigration and protectionism, but hats off to Trump, it has worked for many other world leaders in the past, and now it has worked for him. This protectionism is leading to tariff changes, and in his defence, sometimes the U.S. does get the poor end of the deal, and it has every right to go out and strike better deals, every country does. American tariffs can have wide-ranging effects: currency fluctuations, stock fluctuations, bonds, treasuries, political, cultural and in extreme cases, war. While these tariffs focus on manufacturing, energy and agriculture, the world’s film industry and the British Film Industry will not be immune. If tariffs were imposed on British film exports, they could reshape the entertainment industry, impacting investment, production, and international collaboration.
Tariffs and Their Significance
Tariffs are taxes on imported goods. Yes, one more stealth tax. The government loves taxing everyone so it can buy more pond duck houses and gold paperclips. However, they also make offshore products more expensive and encourage domestic production.
For example, A New Zealand wool jumper costs £10.00 in the UK, but a UK wool jumper costs £11.00. Price is king. Now, some Brits buy the New Zealand wool jumper instead. But if the UK government puts a 20% tariff on that same New Zealand jumper, it now costs £12.00, so now some Brits buy the UK wool jumper at £11.00. The government is happy they make £2.00 on each New Zealand jumper, and British farmers and British wool manufacturers are now happier. Until New Zealand introduces a new tariff on a British item. A tit for tat begins. In practice, it’s more complicated. In some cases, the overseas manufacturer will eat the cost of tariffs. In other cases, they pass it on to consumers, driving inflation. In most cases, it is a combination of the two. It’s hard to know how much the governments raise from these taxes because people may simply buy fewer New Zealand jumpers and because, over time, exporters find ways around tariffs. For example, very hypothetically, Vietnam has no tariff on wool jumpers with the UK, so New Zealand exports wool to Vietnam, Vietnam knits the jumpers there and exports to the UK, and now the product is Vietnamese, even though the wool is from New Zealand. I could go on, but I think this covers the basics.
Please note there were no Kiwis, Vietnamese or sheep harmed during the making of this article, and all of the above is entirely hypothetical.
As economist Paul Krugman once put it, “Tariffs reduce the efficiency of the global economy, but they can also be politically seductive.” While intended to protect domestic jobs and businesses, tariffs often lead to higher prices, retaliation from other countries, and economic inefficiencies.
Over the past few decades, many industries have left the U.S. for countries with lower labour costs, generous tax incentives, and fewer regulatory burdens. The film industry is no exception. Hollywood has increasingly outsourced production to countries like Canada, Mexico, the UK, and Australia due to their attractive tax incentives, lower costs and sometimes fewer regulatory burdens. The UK has benefited from US investment in major productions. However, if Trump were to impose tariffs on British film imports, U.S. investors and U.S. studios might reconsider these collaborations. Governments must learn that businesses need affordable labour, low regulation and reasonable tax rates to thrive.
The Rise of China
I’m not going to bash the Chinese, it is boring. I have a soft spot for the Chinese, having lived in Shanghai. What China has achieved is remarkable. They have lifted hundreds of millions out of poverty and built world-class infrastructure that has transformed China. Historically, China has been at the forefront of innovation, inventing the compass, gunpowder, paper-making, and printing technologies that shaped the world as we know it today. That said, a $295.4 billion trade deficit with China is certainly an issue and a nice down payment on new Battleships. The U.S. trade deficit with China is reminiscent of historical trade imbalances that have led to conflict in the past. One striking example is the Opium Wars of the 19th century, when Britain sought to rectify its trade deficit with China by introducing opium into the Chinese market, leading to widespread addiction and social devastation. This ultimately resulted in military confrontations between Britain and China. Matters should be approached delicately. Ironically, the modern fentanyl crisis in the U.S. bears similarities. As Mark Twain famously said, “History doesn’t repeat itself, but it often rhymes.”
Trade and Power
Tariff imbalances, where one country benefits significantly from trade surpluses while another suffers from deficits, can be a fundamental driver of geopolitical power shifts. The country that benefits from an imbalanced trade relationship often accumulates economic leverage, which can be used to expand its influence in global markets, finance technological advancements, and strengthen its military and diplomatic reach. Great Britain leveraged its industrial and trade advantages to build the largest empire in history, while the U.S. rose to global supremacy after World War II by maintaining a trade advantage and controlling global financial systems. Today, China uses its vast trade surpluses to invest heavily in infrastructure projects worldwide, secure rare resources, build its military, and develop cutting-edge technology, positioning itself as a dominant force.
The film industry is not immune to these power struggles. Hollywood has long relied on China as a massive market, tailoring blockbuster films to pass Chinese censorship rules and appeal to Chinese audiences. However, if trade tensions escalate, the Chinese government could retaliate by limiting the number of U.S. films allowed in their cinemas, even further reducing investments in the UK and U.S. film industries. This could lead to a shift in global film financing and distribution dynamics.
The U.S.’s Trade Deficit and Financial Woes
The U.S. trade deficit reaching a whopping record of $1.2 trillion in 2024 has been a key driver behind Trump’s trade policies. He has repeatedly blamed unfair trade practices for America’s economic woes. The broader financial situation of the U.S. is dire. The federal government is running an unsustainable deficit, and national debt has reached unprecedented levels. The U.S. can sustain some trade deficits because its currency is a global reserve currency. Foreign nations accumulate dollars and reinvest them in U.S. assets such as treasuries, real estate, equities and bonds. Put more simply, money goes out, but it does also come in.
While rebalancing trade deficits could help improve the economic situation, cutting government budgets is also another necessary step to prevent further financial deterioration. Without urgent fiscal reforms, including reducing all expenses, trade deficits, and overspend, the U.S. risks facing severe consequences with global ramifications for all of us.
Can Trade Wars Lead to Real Wars?
I couldn’t call myself British if I didn’t refer to a world war in this article at least once. History has shown that prolonged trade disputes can escalate into actual military conflicts. One of the most notable examples is WWII, which was partly fuelled by the economic turmoil caused by the Great Depression and the retaliatory trade restrictions imposed under the Smoot-Hawley Tariff Act of 1930. These tariffs exacerbated global economic tensions, leading to increased nationalism, protectionism and economic desperation, particularly in Germany and Japan. Trade restrictions imposed by the U.S. on Japan, including oil embargoes in the late 1930s, were a direct catalyst for the attack on Pearl Harbor in 1941.
As historian Douglas Irwin noted, “Trade wars can cause resentment, economic hardship, and ultimately fuel conflicts between nations. Economic disputes left unresolved often become political and military confrontations.” Similarly, economic sanctions and trade disputes continue to be used as a form of modern economic warfare, with rising tensions between the U.S. and China being one of the most significant flashpoints today. If trade restrictions intensify without diplomatic resolution, history suggests they could contribute to broader geopolitical instability.
Trump’s Dislike of the Press and whether the Film and TV Industry Will Be Painted with the Same Brush
Probably. Trump doesn’t seem to like them, and many don’t like him, and fair enough. Journalists could be described as cultural elites with their high levels of education and oversized cultural reach. Having spent many days in the pub with them, I can attest to their love of champagne and their obsession with the redistribution of wealth. Given that much of Hollywood and British media share these ideological leanings and, may I say, their love of champagne, there is a real possibility that the Film and TV Industry could be treated with the same disdain.
If Trump views the entertainment sector as an extension of the media establishment, he may be more inclined to impose tariffs as a form of economic retaliation and punishment. This could be particularly relevant in the UK, where public broadcasting institutions like the BBC have often been critical of Trump. If British media and entertainment are seen as part of the same ideological bloc as the American press, Trump may feel justified in using tariffs to curb their influence and financial power. The question remains: Will the film industry be able to distance itself from the broader media landscape, or will it be painted with the same brush?
Has British and American TV and Film Become Too Socialist, and Does That Make Us a Target?
I’d say so. Trump’s decision-making on tariffs may also be influenced by his long-standing disdain for Hollywood and what he perceives as its left-leaning, globalist agenda. British and American film and television industries have increasingly adopted progressive themes, with a focus on social justice, wealth redistribution narratives, and anti-capitalist undertones. Trump has previously attacked Hollywood elites for their political activism, describing the industry as a “radical leftist” machine that opposes his policies. If he views the entertainment industry as hostile to his administration, he may have fewer reservations about imposing tariffs that hurt its economic prospects. A trade war targeting film and television could be seen as a way of politically punishing an industry he believes is fundamentally opposed to his vision for America. It is time to turn the dial down a little. We may not all agree politically, but we do agree that we all need to eat. Should studio executives be reading this, it is time to change the agenda a little, book your flight to Washington and go kiss the ring; your shareholders come first.
We Are Cultural Ambassadors
This may give us a little cover. Film and TV can be powerful cultural and political exports. Hollywood has long served as an informal arm of American soft power, shaping global perceptions of democracy, capitalism, and Western values. The British Film Industry, too, has been influential in reinforcing the UK’s cultural prestige, from period dramas that showcase its history to modern blockbusters that highlight its creative and technical prowess. Think ‘Iron Man’ in the U.S., a capitalist technologist who saves the world with an iron fist and a good one-liner. ‘James Bond’ and the UK. I could go on.
This cultural influence can be compared to Soviet cinema, which was heavily state-controlled and used as a propaganda tool to promote communist ideals. While Soviet films like ‘Battleship Potemkin’ and ‘Alexander Nevsky’ were masterful in technique, they were largely restricted to serving ideological purposes. In contrast, Western films, while often carrying political messages, benefit from the perception of creative freedom and diversity, making them more effective at spreading influence. Chinese censors know this, which is why our produce is often edited. Restricting the international flow of films through tariffs could hinder the U.S.’s role as cultural ambassadors, reducing the ability of the U.S. and the UK to shape global narratives.
The Potential Increase in Costs of Filmmaking due to Tariffs
Tariffs could lead to shifts in production costs, affecting different aspects of filmmaking:
Costs likely to increase:
- Equipment Imports: Cameras, lighting, and sound equipment sourced from the U.S. or Europe may become more expensive due to increased import taxes.
- Raw Materials: Tariffs on steel and aluminium could drive up costs for set construction and filmmaking infrastructure.
- Talent & Crew Costs: With fewer U.S. productions seeking to film in the UK, skilled workers may demand higher wages to offset reduced yearly dailies.
- Post-Production Services: British post-production houses specialising in CGI, sound design, and editing may see increased costs if the U.S. applies tariffs to digital exports.
- Energy: The UK imports much of its energy. Ever read the meter at the studio? The disk spins quicker than a rat on a wheel.
Costs That Might Decrease:
- Tax Incentives in the UK: To counteract potential job losses, the UK government may offer even greater tax breaks and rebates to attract film projects.
- Currency Exchange Rates: A weaker British pound due to tariff uncertainty could make UK-based productions slightly cheaper for U.S. investors, making us a more attractive destination.
- Unionism: Faith in our unions is at an all-time low. Who really has an appetite for further unionism activity?
Business dislikes uncertainty, it messes with budgets, forecasts and therefore profits predictions. Would you get into a new venture if you didn’t know whether you would make a profit!
Conclusion
Trump’s potential tariffs on the British Film Industry are part of a larger economic strategy rooted in protectionism. While the full impact remains uncertain, the risks are real. History has shown that economic conflicts can escalate into broader geopolitical struggles, and the parallels between past trade disputes and modern economic tensions cannot be ignored. The U.S. must balance its desire to protect domestic industries with the realities of global interdependence. At the same time, the UK film and TV industry must prepare for potential shifts in investment, rising costs and changing trade relationships. All crew and cast should be preparing and setting a little money aside. It has been an awful rocky road for us recently, but it may not be over. Hope for the best; plan for the worst. Whether Trump’s tariffs materialise or not, the changing landscape of international trade will continue to shape the economic future of the film and TV industry in both the UK and the U.S.
Further reading:
1. Impact of U.S. Tariffs on the UK and the Film Industry:
“How Donald Trump’s trade tariffs could affect the UK”
This article from The Guardian explores the potential consequences of U.S. -imposed tariffs on the UK economy, including indirect effects on various sectors.
“The impact of Trump’s tariffs on the UK and the world”
The Telegraph discusses how U.S. tariffs may dampen global economic growth and influence inflation rates, indirectly affecting industries such as film and television.
“Caught in the middle: UK firms brace for fallout from Trump’s global trade war”
This piece from The Guardian highlights the challenges UK businesses, including those in the creative sectors, might face due to global trade tensions and tariffs.
“Hollywood and the MPAA’s Influence on U.S. Trade Relations”
This scholarly article examines the historical impact of Hollywood and the Motion Picture Association of America on U.S. trade policies, offering context for current industry dynamics.
“The vibe may be British, but the money is not: how the U.S. quietly conquered UK TV”
The Guardian analyses the increasing American investment in UK television productions and its implications for the industry.