Movie Diplomacy



Movie DiplomacyCarol Balassa
Curb Center Senior Fellow
Curb Center for Art, Enterprise and Public Policy

The Curb Center’s first Senior Fellow entertains creating new movie networks to advance cultural diplomacy.

Foreign films like the sweeping success story “Slumdog Millionaire” rarely gain access to American screens.  Yet U.S. films dominate motion picture markets in most countries.  Does this imbalance affect America’s quest to win over its adversaries and bridge cultural understanding or does it foster resentment and forestall free trade?  Former U.S. trade negotiator now the Curb Center’s first Senior Fellow, Carol Balassa, tackles this topic with Paula Cleggett.

Paula:  Carol, you’ve had a successful government career dealing with trade issues that affect the motion picture industry and the telecommunications sector.  With little hesitation you accepted Bill Ivey’s offer to become the first Curb Center Senior Fellow.  What is it about your research that interests you the most?

Carol:   Paula, to begin with you said with little hesitation I accepted Bill’s offer. To be precise -- There was no hesitation!  I knew that I was soon going to be leaving government work and it was very exciting for me to receive the invitation while I was still working for the government but was thinking seriously about what my next steps would be. 

Now, why did I accept Bill’s invitation immediately?  To begin with, I had already been working with Bill for some time through the [Arts Industry] Policy Forum [a policy study program for congressional and federal agency staff, developed by the Curb Center].  I had consulted with him on his book (Arts Inc.).  So it was a most natural transition for me to continue for the Curb Center the work that I most enjoyed at USTR (The Office of the U.S. Trade Representative), which was writing about the politics of negotiating.  It was really, specifically motion picture trade issues, which I found fascinating.

Paula:  Great.  So what are you working on at the moment?

Carol:  Last April I prepared a 60-page report for the Curb Center [titled:] America’s Image Abroad, the UNESCO Cultural Diversity Convention, and U.S. Motion Picture Exports.  That report concluded with a recommendation to develop a training program in film distribution that would be available to our different trading partners and would meet both their commercial and cultural interests by providing an opportunity to learn how to distribute their films and would, at the same time, serve U.S. public diplomacy goals.

And that recommendation has evolved into a new project that aims to bring together filmmakers, distributors, and government officials -- several dozen in all -- from several different countries for a workshop with industry professionals who can provide the “ins and outs” of marketing and distributing a film internationally.

One of the major problems I encountered in the work I did was a feeling among our trading partners that Americans, whose films dominate most foreign markets for motion pictures, are not interested in seeing the films that others have produced.  So, this would address several issues at the same time, and I’m working on that proposal right now.

Paula:  As you’ve explored this topic have you uncovered any surprises along the way?

Carol:  The biggest surprise was yesterday when I attended a valedictory seminar by a senior [government] official who works on public diplomacy issues and, when I put to him a question as to whether consideration had been given to working with the private sector in addressing some of the resentment that our motion picture exports creates, I was surprised to hear that  he was not aware that the preponderance of U.S. motion pictures in most cinemas abroad was a cause of resentment.

Paula:  A topic that’s been in the news –

Carol:  I don’t understand how someone whose title includes “public diplomacy” would be unaware that there is a flip side to America’s success in exporting its films and that when foreigners see their cinemas almost completely dominated by American movies, they feel that Americans are responsible for the problems that their own domestic industry may face in finding an audience.  Of course the problems that a local film industry faces may have little to do with the preponderance of American films, but it is all too easy for local filmmakers and their government representatives to draw this conclusion.

Paula:  Do you think our presence -- in terms of American films shown in other countries -- influences the way they see us and the way they see themselves? 

Carol:  To answer that question you need to define the population you’re working with.  After all, the fact that American films are so successful abroad raises the question of: “with whom are they successful?”  American films appeal to the broad general population.  Those who resent the presence of American films may be the political and cultural elite who view movies as an expression of their national identity and national pride.

Let us take, for example, the French, who are extremely sensitive on this issue.  The French elite, including French government officials, resent the fact that so many American films are shown in France while their films have so much difficulty in entering the U. S. market.  For a long time they had the misperception that the problems French films encountered were due to government-imposed restrictions.

There are no U.S. government restrictions on film imports.  There are serious commercial challenges, however, that most films face in obtaining exhibition in the United States.  But that is in large part the result of the marketplace and not the result of government policy.

Paula:  The training program that you talked about in film distribution, what do you see as its biggest obstacle or challenges?

Carol:  Well, before yesterday’s experience I would have said “funding.”  But on reflection, I think the primary challenge is getting government officials -- and it’s not only government officials because we’ll be looking to the private sector and we’ll be looking to foundations to fund this program -- to recognize that there is a problem. 

It becomes a question of how the United States is viewed abroad, and if we’re viewed as restricting the ability of others to express themselves or being totally disinterested in viewing their films, it becomes an issue of lack of respect for their culture.

I’m avoiding the term “cultural diplomacy,” but we could call it a “public diplomacy” issue.   This has been a serious problem throughout the Bush Administration, it is certainly an issue that is high on the new administration’s agenda, and I was pleasantly surprised to hear Secretary [then designate] Hillary Clinton talk about “smart power” and specifically mention culture as one of the tools which should be used in a strategy of smart power. 

Paula:  Now, what does “smart power” mean?

Carol:  Smart power would be the use of non-military, diplomatic instruments to achieve a specific goal.  You can use funding for education, providing medicines in the face of an epidemic, sharing technology as it’s needed.  In this particular case it would be sharing knowledge of how to distribute movies.  You can elaborate a long list; I’ve just touched on a few.  Joe Nye of Harvard, who has helped to coin that phrase, has discussed it at greater length.

Paula:  So, what opportunities might there be in having such a program?  What are we aiming for?

Carol:  In other words, what’s the objective, why should the United States become involved both at the public and the private level?  To create the image that at a cultural or artistic level Americans are interested in hearing the stories of other people and are willing to share their expertise and help fund programs so that others may distribute their films and have their stories heard  internationally .

Paula:  Just so we’re clear, if we have this exchange and we see more about another culture and they see more about us, what does that lead to?

Carol:  Well, you talk here about an exchange.  It has been a long tradition in American public diplomacy, and this goes back to USIA [the former U.S. Information Agency, which ended in 1999] days, where our embassies would show American movies in order to portray a favorable image of the United States. 

The program that I envisage could include the showing of American films; you could very well have a program where you show both American films and films made abroad.  But many have seen enough American movies and to change the image we need to get the word out and create the impression that Americans want to see the films, hear the stories that others have to tell.  So, this is not about an exchange, in that sense.

Paula:  Are we, ultimately, looking for a breaking down of barriers; if people understand human issues –

Carol:  One of the great challenges in a program like this is how to measure success.  The public diplomacy aspect is key, and it is probably one of the facets that would differentiate this program from others because business schools, law schools, film schools, do have programs on film distribution.  The program that I have in mind would a) be far more detailed, appealing to the established filmmaker and b) would address the realities of the U.S. film marketplace. 

Many filmmakers outside the United States dream of getting their films into American theaters.  In reality this is extremely difficult.  It’s very difficult for American independents and it is extraordinarily difficult for foreigners.  There are rare exceptions, but an important component of the program would be to explain the difficulties of entering the U.S. marketplace and show alternative opportunities, which could be DVD distribution in the United States as well as exploring more efficiently the opportunities both at home and in the region.

After all, I come at this issue from the trade side, and I worked at this issue at the Office of the U.S. Trade Representative since 1980.  I am all too well aware of the many obstacles to removing trade barriers in the area of motion pictures.  So there is a trade agenda to this program too, because if some of the resentment and hostility aimed at U.S. motion picture exports is removed, if other film industries have an opportunity to develop and to distribute their films internationally, they’re going to discover that their films face trade barriers and they’re not going to like it.  This could help build up an alliance of countries that want to see trade barriers on motion pictures removed, and it would be the basis for making some progress on the issue in the WTO.

Paula:  WTO?

Carol:  The World Trade Organization.  There’s also a very important intellectual property component to this discussion.  There have been articles in the newspaper recently that RIAA, the Recording Industry of America, for example, has recognized that their very aggressive program against piracy is beginning to be counterproductive -- many foreigners are beginning to associate anti-piracy efforts as a program sponsored exclusively by the Recording Industry of America and the Motion Picture Association and therefore only in the interest of Americans. 

But, if foreigners have an opportunity to develop their own industry and they too are confronted with the problems of piracy, then they will build up their own vested interest in effective intellectual property protection.  So this is a program that offers a number of different benefits.

Paula:  Carol, you know a lot about the film industry.  How did you get involved in that field?

Carol:  Well I didn’t know a lot about it when I first got involved.  I was part of the original services team at USTR [1980].  That was the team that helped to place services on the agenda for international trade negotiations because before 1985, only goods were covered by international trade rules.

Paula:  So, it was “goods” and not “services” that were being negotiated.

Carol:  That is correct.  We used to say that only things you could pick up and drop on your foot were covered by trade rules. 

And at the end of the “Tokyo Round” [international trade negotiations in the1970’s], American Express and AIG tried to have their sectors, in other words banking and insurance, put on the international trade agenda.  An effort to do so was undertaken at USTR and that’s when I came onboard.   So, as part of that original services team, we were looking at the different service sectors.  As the new kid on the block I was given motion pictures.  Now, the reason I was given motion pictures is that it was thought to be an intractable issue.  There was an anti-trust case --

Paula:   Ongoing at the time?

Carol:   Yes, it was eventually resolved in the mid 80s.  There had also been tax shelter legislation for motion picture production that was ended in the mid 70s, and so when the U.S. government came calling on the industry, principally, the Motion Picture Association, and said “we’d like to help you,” you could just hear the manhole covers close -- there was very little interest on the part of the Motion Picture Association to talk to the government at that time.

I called a meeting; I remember it was July 17th, 1981, the Motion Picture Association sent two representatives, and one of their member companies, Twentieth Century Fox, sent a representative as well.  On the independent side, Bobby Meyers, who was the founder of what became the American Film Marketing Association and is today the IFTA, Independent Film and Television Alliance, came.  We had Jack Golodner, who represented the AFL-CIO and we had a representative of IATSE [The Alliance of Theatrical Stage Employes, Moving Picture Technicians, Artists and Allied Crafts of the United States]. 

So, in addition to the majors, we covered the independents, we covered labor.  On the government side, in addition to USTR, we had representatives from State, Commerce, Treasury, Justice and Labor.  This was the first, perhaps the only, time that such a meeting was held between the different facets of the motion picture industry and U.S. Government agencies.

Once the Motion Picture Association understood what USTR was trying to accomplish by having trade rules cover services, they realized how this could help them enter foreign markets.  So, it was actually members of the Motion Picture Association who later taught me a great deal about what I came to know about trade and motion picture issues.

Paula:  But obviously a topic that fascinates you.

Carol:  It’s fascinating personally, professionally, yes.  And there were very few people who were working on this combination of trade and motion pictures.  I developed a very constructive working relationship with the industry.

Paula:  So, since that time you’ve kept it in your portfolio, so to speak.

Carol:  I relinquished it on a few occasions but always came back to it, and when I relinquished it, it was to work in related areas.  I left the portfolio for several years; this was during the “Uruguay Round” [a series of ministerial meetings from 1986 to 1994 that led to the World Trade Organization] to work on telecommunications issues.  But that was in part because telecommunications was linked to motion pictures.  Later on I went to work on energy services; in fact energy was linked to telecommunications in the sense that both were related to access and use of a network to deliver the product.

Paula:  If students were interested in this area of study on international trade, motion pictures, and cultural exchange, are there opportunities for them to learn more?  What would a student do to participate in some way in this process?

Carol:  Well, certainly you touch on an issue that’s related to the film distribution training program that I’m in the process of developing.  There are obviously books and basic courses on the subject, but I have been told that the kind of program that I’m attempting to develop does not in fact exist in film schools at this time, or in business schools. 

Certainly there are books out there, but so much what I have learned has come from working with the private sector, and there have been some lawyers who have spent a great deal of time teaching me about this.  When I read papers on these issues written by non-trade specialists, I often see numerous errors. 

This is not information that is readily available, so it makes me think that a spin-off of the program that I am developing could be in fact to train trade negotiators or other professionals who need to work in the field, not for commercial purposes but, as in my case, for public policy or trade negotiating purposes.

Paula:  Bill Ivey has said many times that art conveys national identity and constitutes our nation’s heritage.  He says that our cultural heritage, the birthright of every citizen, has carried the dream of America’s democracy around the world.  On that front what do you see as the biggest issue that leaders and policy makers should address, and why?

Carol:  I hesitate to answer because the question was formed as if there were but one cultural identity, and I would think that the hallmark of the United States is its mosaic quality.

Paula: So, we don’t have one national identity?

Carol:  Not at all.  It’s the heterogeneity.  It’s the complexity that characterizes the United States.  The term mosaic has been coined to express the United States.  If you think of France, if you think of Germany, if you think of Italy, if you think of Korea, you have a certain impression of their culture.  I would hope that when you think of the United States -- now of course our blockbuster films will convey a certain identity -- but for those who understand American culture a bit more, it is the extraordinary diversity that is our hallmark. There is no single identity. 

We can talk about music, for example, I had the occasion recently of hosting a young French student and I took her to different musical events about town.  I took her to see “The Nutcracker,” we went to Blues Alley for her to hear jazz, then I went over to The Kennedy Center and they had a group there –

Paula:  The Millennium Stage probably.

Carol: Yes, it was Millennium, and it offered an extraordinary group:  they represented a blend of country, Caribbean, and folk music.  And I realized that you don’t talk about a single musical tradition in this country. The same would apply to almost any aspect of our culture.

Paula:  If we’re trying to use art to convey our dream of democracy around the world –

Carol:  Yes, well the diversity exists because it is a reflection of the democratic basis on which the art exists.  Now there are very interesting issues behind that.  The fact that there is relatively little federal funding in the arts, that you have indirect funding through tax policy, but the way in which the arts are funded means that there is no single agency responsible for pinpointing funds…  it is not the government that is determining the target of the funding.  The government is not choosing the winners and losers in the arts.  That is a reflection of the diversity and it is a reflection of the democratic nature of the arts in this country.

I think one of the reasons that I’m so interested in film distribution is that it does address one issue in the arts that is of concern to me, which is the fact that many feel that because of our economic dominance in this area we are submerging other cultures.  I do think that that is a major issue to address to help convey the democratic message about our political system and the culture on which it is based.


To learn more about Carol Balassa and her project, “The Business of International Film Distribution: Pilot Proposal for a U.S.-Sponsored Capacity-Building Program,” visit: Carol Balassa: Senior Fellow