The Case for Biden to Bail Out Paramount
Banks got help in a crisis. So did auto. Why can't legacy studios also be too big to fail?
I know what you’re thinking when you see that headline: Seriously?!
But having watched this Paramount sale drama play out over these many months — and not come to fruition despite many times when it appeared over — I think I speak for everyone when I say, stop this ride, I wanna get off. The Paramount story is like we’ve recast Barbarians at the Gate, arguably the best business narrative of all time about the leveraged buyout of RJR Nabisco, as this generation’s attempt to make a private equity M&A transaction as rollicking as that one from 35 years ago.
What should not — and cannot — be lost in this is Paramount itself. My colleague Richard Rushfield has eloquently discussed both Paramount and the importance of a robust studio ecosystem. As he wrote in April about Paramount’s venerable roots:
No company in history did more than Paramount to provide the masses with higher-class amusement. And in their sweep the entire industrial entertainment project was born.
We’re talking about The Godfather, Chinatown, Rosemary’s Baby, Psycho, Saving Private Ryan, Beverly Hills Cop, Top Gun, Ferris Bueller’s Day Off, Grease. And on and on and on.
CBS, of course, has its own esteemed legacy, the home of Murrow and Cronkite, Norman Lear and the only broadcast outlet that could live up to the Tiffany Network moniker. And 60 Minutes, the most successful news show in history.
How can we, as a society, just let all that twist in the wind in an endless process? As with other debt-burdened industries before, the government needs to step in with a bailout in the way it has with automobiles and banks in this millennium. Hollywood may have a reputation as frivolous, but in terms of the jobs, the economy and America’s standing in the world, its health is essential.
Isn’t This Socialism? Actually, No
Nationalizing companies may call to mind some scary fever dream of developing-world leaders taking control of private industry. But, in fact, as the researcher Thomas M. Hanna wrote in 2019, America “actually has a long and rich tradition of nationalizing private enterprise, especially during times of economic and social crisis.”