United States. Congress. Senate. Special Committee.

Post-war economic policy and planning. Joint hearings before the special committees on post-war economic policy and planning, Congress of the United States, Seventy-eighth Congress, second session, pursuant to S. Res. 102 and H. Res. 408, resolutions creating special committees on post-war economic (unit 9) online

. (page 1 of 18)
Online LibraryUnited States. Congress. Senate. Special CommitteePost-war economic policy and planning. Joint hearings before the special committees on post-war economic policy and planning, Congress of the United States, Seventy-eighth Congress, second session, pursuant to S. Res. 102 and H. Res. 408, resolutions creating special committees on post-war economic (unit 9) → online text (page 1 of 18)
Font size
QR-code for this ebook


rB"



t



, 1 ^^ ^V?i^.X




^



^-^^ \\




Given By
U. S. SUPT. Oi' DOCUMEr;TS



^






POSTWAR ECONOMIC POLICY AND PLANNING



HEARINGS

BEFORE THE

SPECIAL COMMITTEE ON POSTWAR ECONOMIC
POLICY AND PLANNING

HOUSE Oil REPRESENTATIVES

SEVENTY-NINTH CONGRESS

FIRST AND SECOND SESSIONS
PURSUANT TO

H. Res. 60

A RESOLUTION CREATING A SPECIAL COMMITTEE 0.\
' POSTWAR ECONOMIC POLICY AND PLANNING



PART 9



DECEMBER 20, 1946



EXPORT OF INFORMATION MEDIA, BOTH
GOVERNMENT AND PRIVATE



Printed for the use of the Special Committee on Postwai
Economic Policy and Planning




UNITED STATES
GOVERNMENT PRINTING OFFICE
99579 WASHINGTON : 1947



^



^9,^ '9



SPECIAL COMMITTEE ON POSTWAR ECONOMIC POLICY AND

PLANNING



WILLIAM M.

JERE COOPER, Tennessee
FRANCIS E. WALTER, Pennsylvania
ORVILLE ZIMMERMAN, Missouri
JERRY VOORHIS, California
JOHN R. MURDOCK, Arizona
WALTER A. LYNCH, New York
THOMAS J. O'BRIEN, Illinois
JOHN E. FOOARTY, Rhode Island
EUGENE WORLEY, Texas



COLMER, Mississippi, Chairman

CHARLES L. GIFFORD, Massachusetts
B. CARROLL REECE, Tennessee '
RICHARD J. WELCH, California
CHARLES A WOLVERTON, New Jersey
CLIFFORD R. HOPE, Kansas
JESSE P. WOLCOTT, Michigan
JAY LeFEVRE, New York
SID SIMPSON, Illinois



FRANCIS WALTER
JOHN E. FOGARTY



Subcommittee on Foreign Trade

EUGENE WORLEY, Chairman

RICHARD J. WELCH
CHARLES A. WOLVERTON

Marion B. Folsom, Staff Director

William Y. Elliott, Consultant

Winifred G. Osborne, Clerk

Susan Alice Taylor, Secretary



1 Resigned from Congress in 1946,
II



CONTENTS



Page
Statement of —

Johnston, Eric, president, Motion Picture Association of America,
presented by Air. Jack Bryson, public relations representative of the
association 2522

Nelson, Donald, president, Society of Independent Motion Picture

Producers 2524

Hulten, Cliarles, deputy to Assistant Secretary of State William

Benton, Department of State 2525

Begg, John M., Chief, International Motion Picture Division, Depart-
ment of State 2534

Golden, Nathan D., consultant for motion pictures, Department of

Commerce ^ ' 2545

Brown, Winthrop G., Chief, Commercial Policv Division, Department

of State 1 2553

O'Hara, Joyce, assistant) to Mr. Eric Johnston, president, Motion

Picture Association 256 1

Harmon, Francis, vice president, Motion Picture Association 2562

Milliken, Carl E., secretary, Motion Picture Association 2583

Mayer, Gerald, associate manager. International Department,

Motion Picture Association ^ 2590

EXHIBITS





Introduced
on page -


Appears on
page —


No. 1. The motion picture on the threshold of a decisive
decade _._ . _ .


2568
2583


2594


No. 2. Hollvwood and international understanding _ .


2621







POSTWAR ECONOMIC POLICY AND PLANNING



FRIDAY, DECEMBER 20, 1946

House of Representatives, Subcommittees
OF the Special Committee on Postwar Economic

Policy and Planning,
Washington, D. C.

The subcommittee met, pursuant to call, at 10 a. m., in room 1301,
New House Office Building, Hon. Eugene Worley (chairman) presid-
ing.

Present: Representatives Worley (chairman), Walter, and Mur-
dock.

Also present: Dr. W. Y. Elliott, consultant.

Mr. WoRLET. The committee will be in order.

In order to facilitate the work of the House Special Committee on
Postwar Economic Policy and Planning, the main committee was
divided into several subcommittees. One of those subcommittees
is the Committee on Foreign Trade and Shipping, which for the past
year or more has held rather exhaustive hearings, going into practi-
cally all phases of our foreign trade and shipping. Because of the
press of other wartime congressional duties, the committee has not
had an opportunity to hear the representatives of an industry which
plays a rather important part in om* relations v/ith other countries
abroad, namely, the motion picture industry. The pm-pose of the
hearing today is to determine among other thmgs what om- own
Government is doing in trying to create a favorable impression of the
United States in the minds of other people over the world by virtue
of radio, press, and motion pictures; what it is doing in combating
trade restrictions abroad ; and we also want to hear the representatives
of those engaged in the commercial phases of motion-picture dis-
tribution abroad, namely, the motion-picture industry.

We have been requested by Mr. Eric Johnston, the president of the
Motion Picture Association of America, who could not be here in
person, that a statement prepared by him be read into the record.

At this point, if there is no objection, we will now proceed with the
statement by Mr. Johnston. Is there someone here to read this for
him?

Mr. Br^son. Yes, I will be very happy to.

Mr. WoRLEy. Will you please state your name and position?

Mr. Br^son. Mr. Jack Bryson, public relations representative of
the Motion Picture Association of America.

Mr. Worlev. The committee will be glad for you to proceed, Mr.
Bryson.

2521



2522 POSTWAR ECONOMIC POLICY AND PLANNING

STATEMENT OF ERIC JOHNSTON, PRESIDENT, MOTION PICTURE
ASSOCIATION OF AMERICA, PRESENTED BY MR. JACK BRYSON,
PUBLIC RELATIONS REPRESENTATIVE OF THE MOTION PIC-
TURE ASSOCIATION OF AMERICA



Mr. Bryson. Mr. Chairman and members of the committee, and
Dr. Elhott [reading:]

Statement Submitted by Eric Johnston, President, Motion Picture Asso-
ciation OF America

I am grateful for this opportunity to submit a statement on the motion-picture
industry for incorporation in the record of your committee.

I am president of the Motion Picture Association of America, which consists
of a number of leading American companies engaged in production, distribution,
and exhibition of motion pictures. I speak only in behalf of our members.

Ours is a young industry, as industries go, but it has a typical and traditional
American background. Like many other great industries in the United States,
it started on the proverl^ial shoestring.

The men who jiioneered the industry and the men active in its affairs today are
proud of the fact that it developed to its present size without benefit of Govern-
ment favor or subsidy of any kind.

Over the past half century, the motion-picture industry has had a phenomenal
growth. In that relatively short space of time, the screen has become the greatest
entertainment source the world has ever known. During these initial stages,
the emphasis was largely on entertainment.

We now realize that the scope and purposes of the motion picture have gone far
beyond that. It has taken its place beside the press and radio as one of the great
media for the dissemination of information and enlightenment.

During the recent war there was no medium which surpassed the motion picture
in its ability to bring home the true meaning of that titantic struggle to all the
peoples of the world. It was especially effective in telling the story of America
as the arsenal of democracy. Bur the emphasis now is on peace, not war. And
the motion picture can play an etiually vital role.

Because of this, it is essential that the screen must be as free as the press and
radio to fulfill its mission. It must be free of Government fetters in its production
and in its distribution.

But freedom of movement is just as important as freedom of content. A screen
penned up behind national boundaries is not free, for the freedom to move freely
is an inseparable part of freedom of the screen. Measures which curb this flow,
no matter how artfully contrived, abridge that freedom.

This right of freedom of expression and communication by means of the motion
picture is something bigger than Hollywood's desire to sell pictures. Either we
believe in the screen as one of the great media of human communication or we
don't. The unfettered use of this medium is beyond the bare fact of economics.

Throughout the world there is a tremendous awakening to the power of the
motion picture on the part of governments and peoples. That is the major
reason why this inquiry on the part of your committee is so important.

It is highly essential that we foster the growth and development of the American
motion-picture industry for two major reasons: One, from a cultural standpoint,
it is the greatest conveyor of ideas — the most revolutionary forces in the world '
today; two, from an economic .standpoint, it occupies an increasingly large place
in America's domestic and foreign commerce.

Your committee has asked us to answer this question: "What is the impor-
tance of the foreign market to the motion-picture industry?"

The American motion picture is geared to a world market. Although the
American market is the largest in the world, one-third of the production cost of
our pictures comes from abroad.

Tlie American industry is not alone in depending for its economic health on
foreign markets. The British industry and those in other countries are finding ,
this out. If they want to produce top-grade pictures, they need a world market
to amortize production costs. Closing of the foreign markets would mean
inferior pictures and fewer jobs.



POSTWAR ECONOMIC POLICY AND PLANNING 2523

The American film industry is thinking in terms of an expanding world market
and not a narrowing one. Only a small percentage of the people in the world
see motion pictures today. Actually there are millions of people who have never
seen a picture at all.

The industry cannot grow to its greatest usefulness and greatest service, how-
ever, as long as there are restrictions on the interchange of pictures among
countries.

In the year ahead we are certain to witness new and more widespread demands
for barriers against the freer flow of motion pictures from one country to another.
There are many types of such restrictions, both direct and indirect. " Some are in
existence. More are threatened.

One type of restriction is excessive taxation on imported films. If the taxes
are too high, business becomes unprofitable and the market dries up. The same
result follows from excessive tariff or customs barriers. Blocked currency also
prevents the recovery of film assets.

Another form of restriction is the imposition of quota laws, which guarantee a
percentage of playing time for domestic films. Quota restrictions are bad in
principle. But where they are used reasonably, to help an infant industry or a
war-weakened industry to get on its feet, an exception can be made. For in-
stance, the British industry today is guaranteed approximately one-fifth of playing
time in British theaters. But the ultimate goal should be to lower, not to raise,
these barriers.

The most pernicious type of restriction is the complete ban on the importation
of foreign films. Nazi Germany adopted this practice even before the start of the
recent World War. Unfortunately, there are too many countries today in which
foreign pictures are not permitted to circulate.

This form of restriction, dishonest in concept and purpose, too often arises
from the fact that American pictures inescapably reflect our way of life. Some
foreign critics fear our American system. Consequently, under one guise or
another, they would keep out American pictures. They prefer to see the screen
used as a weapon of ideological warfare.

Whatever their form, singly or in combination, or whatever their purpose, it is
quite obvious the target of them all at the moment is the American film because
it reaches around the world and because, as of today, it enjoj'S a majority of
playing time on the world's screens.

Your committee wants to know what the ITnited States Government may
legitimately do to assist the motion-picture industry abroad.

The best possible course is to continue the present policy of the State Depart-
ment. As you know, this policy is free of any party tag or label. It is based
wholly on the traditional American belief in freedom of expression and communi-
cation, and is designed to remove and prevent discriminatory restrictions. This
fine cooperation was exemplified in the Byrnes-Blum French film accord and in
other forms of assistance under the direction of William H. Cla.yton, Under
Secretary of State for Economic Affairs.

Your committee desires to know what our industry is doing to promote Ameri-
can motion-picture films abroad. We are doing several things. We recognize
that it is in the best interests of our country and the film industry to exercise
prudent selectivity of pictures going abroad. We are doing something about it.
Our association, acting in an advisory capacity, is assisting in the selection of
films to be exported. Through use of self-regulation, we believe that we can be
more discriminating in the type of pictures sent to other countries.

We are also practicing selectivity in another way by voluntarily limiting the
number of pictures we are exporting to several countries. And we are sending
trained men to key spots throughout the world to help expand markets for
American films and to report on developments affecting our industry.

Recently, I spent a month in London conferring with government officials
and representatives of the British film industry on how to promote the freer
interchange of pictures and how to safeguard the freedom of the screen itself.
While our two systems are competitive, they are also complementary. We are
both interested in a constantly expanding world market.

Your committee has asked us to comment on the type of film which would
give foreigners the best idea of America.

The answer is that the most effective type is the film which tells a good story,
which entertains, which informs or enlightens. It would be a grave blunder to
use the screen deliberately as a weapon of political propaganda. Such propaganda
is always transparent; it is universally resented, and it is always self-defeating.



2524 POSTWAR ECONOMIC POLICY AND PLANNING

The American press services have established a reputation for fairness and
accuracy throughout the vi'orld by the simple formula of telling the truth. This
impartiality is the hallmark of American news services; it has paid rich dividends
in confidence not only at home but abroad as well.

The sane way for the motion picture is to depict the culture of America as it is,
without distorting either its virtues or its faults. Foreign audiences are far more
impressed by the fact that Americans are free to criticize themselves or their
government than they are by any amount of self-praise.

I realize that the ideal has not always been attained. Frankly, there is room
for improvement. I have outlined the efforts which our association is making to
keep a watchful eye on the pictures sent abroad.

But in our desire to guard against undesirable pictures going abroad, we must
resist any curbs which would cramp the screen's freedom. Inevitably, such a
course would do irreparable harm. Whenever censorship of that nature has been
attempted, the result has alwaj's been harmful. It is not in the Ainerican tra-
dition.

The American way, based on fairness and truth-telling and freedom from
official interference, has achieved remarkable results in the fields of press, radio,
and motion pictures. We must retain the cornerstones on which these great
services have been built.

Like all successful industries we are constantly striving to turn out a better
product so th^t we shall continue to deserve the support of the world public.
That's our responsibility, that's our ambition. We are striving to meet this goal
in full faith and with full effort.

Mr. Chairman, I appreciate and thank you, on behalf of Mr.
Johnston, for accepting that statement.

Mr. WoRLEY. I wish you would express to Mr. Johnston our regret
that circumstances prevented his being here.

Mr. Bryson. I would be very happy to do so.

Mr. Worley. The committee has received a telegram from Mr.
Donald Nelson, president of the Society of Independent Motion
Picture Producers, who also was unable to be present. It will be
inserted in the record at this point,

Hollywood, Calif., December 21, 1946.
Hon. Eugene Worley,

Care of Calmer Committee,

House of Representatives, Washington, D. C:

Thank you for advising me about Colmer Committee. Following is my state-
ment: American Motion Picture Industry which Yankee ingenuity and hard
work has made envy of world is being seriously threatened in hope of capturing
our world. Following artificial restrictions are being applied to showing of
American pictures abroad by private and government monopolies operating on a
"If you can't win from the other fellow tie his feet so he can't run." Principly,
as president of Society of Independent Motion Picture Producers, I would like to
call attention of committee to following facts: On merit alone American motion
picture industry increased its following before the war in one foreign country after
another so that in 1940 one-third of our entire screen income came from abroad.
This in turn enabled us to raise our standards and produce pictures of quality
which found favor not only in this country but abroad.

We are still doing this today, but under most difficult conditions. Costs of
motion pictures, due to higher wages for labor and higher prices for materials and
equipment, have been rising steadily. Today they are 60 to 70 percent higher
than in 1940, with no promise of relief to avert serious crisis in industry — a
crisis which is certain to bring about downward revision of production standards.
We have been counting on restoration of our prewar foreign trade, if not entirely,
then to a degree compatible with increasing competition from native pictures in
England, France, Russia, and other countries. Such competition we welcome.
It is healthy and invigorating, so long as it remains free. What we are confronted
with, however, is not free competition. Government monopolies, or private
interests working through such monopolies, are imposing unfair and artificial
restrictions on American films in hope they can hold us down until they themselves
can gain monopoly over world producers. We believe motion-picture theaters of
the world as well as our own in America should be wide open to all films on merit.
We believe film exhibition should be conducted without restrictions from monopo-



POSTWAR ECONOMIC POLICY AND PLANNING 2525

lies either at home or abroad. And we believe United States Government
should use every influence that does not conflict with real meaning of free enter-
prise to oppose and eliminate such artificial restrictions, wherever they are found.
There are two basic reasons for our beliefs. One, there is no better way to help
people of Europe and Asia understand American system which has brought
greatest happiness in world to greatest number of people than by keeping screens
of world free. This understanding of America I regard as first requisite of world
peace. Two, we agree with British motion-picture industry and British Govern-
ment that trade follows motion pictures into world markets — fact of which I am
certain your committee is already aware of. One thing independent motion-
picture producers are certain we cannot help build a better world to live in by
having our trade tied down with artificial restrictions.

We will be glad to furnish detailed study of how our pictures are affected by
monopolistic practices abroad if committee desires.

Following is list of society members: Constance Bennett Productions; Benedict
Bogeaus Productions; Sidney Buchman Productions; Cagney Productions, Inc.:
California Picture Corp.; Charles Chaplin Studios; Walt Disney Productions,
Inc.; Bing Crosby Enterprises, Inc.; Golden Pictures, Inc. (Edward A. Golden);
Samuel Goldwyn Productions, Inc.; Sol Lesser Productions, Inc.; Majestic Pro-
ductions, Inc., (Jules Levey); Nero Films, Inc. (Seymour Nebenzal) ; Comet
Productions, Inc. (Mary Pickford) ; Rainbow Productions, Inc.; Charles R.
Rogers Enterprises; Hal Roach Productions; Edward Small Productiosn, Inc.;
Andrew Stone Enterprises, Inc.; Story Productions, Inc. fArmand Deutsch and
Hal Home); Hunt Stromberg Productions, Inc.; Vanguard Films, Inc. (David O.
Selznick); United Artist Productions; Walter Wanger.

Donald M. Nelsqn,
President, Society of Independent Motion Picture Producers.

Mr. WoELEY. We have also asked Mr. I. E. Chadwick, president
of the Independent Motion Picture Producers' Association to present
a statement, but apparently illness has prevented his doing; so.

Is the representative of the State Department here — Mr. Hulten?

Mr. Hulten. Yes, sir.

Mr. WoRLEY. Would you please state your name and position?

Mr. Hulten. I am Charles Hulten, deputy to William Benton.

STATEMENT OF CHARLES HULTEN, DEPUTY TO ASSISTANT
SECRETARY OF STATE WILLIAM BENTON, DEPARTMENT OF
STATE

Mr. Hulten. Mr. Chairman and members of the committee, and
Dr. Elliott, it is my privilege to appear before this committee as
deputy to Mr. William Benton, Assistant Secretary of State, who is in
charge of the Department's international information and cultural
programs. Mr. Benton would have been happy to appear himself,
but unfortunately he is on the high seas returning from a recent meeting
of the United Nations Educational, Scientific, and Cultural Organiza-
tion in Paris.

Mr. Benton has been working closely with Eric Johnston, who is his
long-time personal friend, on problems relating to international dis-
tribution of motion pictures. As you gentlemen of this committee
know, Mr. Benton was called in by "the Department to assume charge
of the consolidated wartime programs of the Office of War Informa-
tion and the Office of Inter-American Affairs.

His approach to these problems, as he reviewed them during his
first months in oflSce, was to eliminate as many of the wartime controls
and Government activities as possible. Both OWI and 01 AA had
motion-picture programs. OWI, with its emphasis on psychological
warfare, had developed a program of 35-mm. film production designed



2526 POSTWAR ECOXOMIC POLICY AND PLANNING

for theatrical release in enemy and occupied countries when these
became accessible, and in neutral and allied countries. The OIAA,
operating exclusively in the Western Hemisphere, emphasized 16-mm.
films for nontheatrical distribution. Both agencies had programs for
consulting with Hollywood producers in the national interest. OWI
had a Hollywood staff to which the industry referred problems in
overseas production and distribution. OIAA operated through an
industry-created group called the Motion Picture Society for the
Americas.

Both Elmer Davis and Nelson Rockefeller havie testified on many
occasions to the cooperative efforts of the industry during the war.

Mr. Benton faced the necessity for reducing the large wartime
information programs by approximately 75 percent. Economy was
not the sole objective. Wartime conditions had required that the
Government, in the person of the armed forces, control international
communications and transportation. In developing the Depart-
ment's peacetime information and cultural program, Mr. Benton
placed primary emphasis on the restoration of normal private and
commercial intercourse between nations. The Department's pro-
gram was designed to be facilitative and supplementary. In other
words, the Department, through Mr. Benton, proposed that America's
story be told abroad principally tlirough its privately owned and
wholly independent press associations, magazines, books, motion
pictures, and similar media, as it had been told before the war.

In line with the increased interest in America, the Department
stood ready to assist this flow of material in every way that it legiti-
mately could. In certain fields of activity, and in certain areas of the
world, private or commercial groups have found it difficult or impos-
sible to operate. To fill these gaps, the Department undertook a
modest program of supplementation.

The Congress reviewed the program earlier this year and provided
the appropriations necessary to carry it out.

In the motion-picture field, the supplementation consisted princi-
pally of the creation or adaptation of 16-millim.eter documentary
films, dubbed in foreign languages, illustrating important aspects of
American life or policy. In the change-over from, war conditions, the
motion-picture industry cooperatively took over the United News
Reel, which had been paid for by the Government through the OWI
during the war. The OWI staff in Hollywood was disbanded. Dis-
cussions were held with the industry to determine whether the industry
itself would assume the consultative function carried on by the Motion
Picture Society for the Americas.


1 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

Online LibraryUnited States. Congress. Senate. Special CommitteePost-war economic policy and planning. Joint hearings before the special committees on post-war economic policy and planning, Congress of the United States, Seventy-eighth Congress, second session, pursuant to S. Res. 102 and H. Res. 408, resolutions creating special committees on post-war economic (unit 9) → online text (page 1 of 18)