AMERICA'S GREATEST EXPORT
IS LEAVING HOME
The Coalition for American Production, the fight for a federal film incentive, and why the country that invented the movies is losing them.
Written by Adam Nelson, Co-Founder, Socko!
Before there was a flag there was a fire, and before there was a fire there was a wall, and on the wall somebody drew a picture of an animal and pointed at it and said, “Look.” Everybody looked, and that became the first story ever told. A hand, a wall, a flame. That is the whole history of human civilization reduced to three nouns and a verb. We have been telling stories since we crawled out of the dark. It is the single most durable human impulse after breathing and eating and making sure the children survive.
The United States of America took that impulse and turned it into the most powerful cultural export in history. Not oil. Not wheat. Not steel. Not the automobile. Stories. American stories, told through American cameras, performed by American actors, built by American hands, projected onto screens in 195 countries on six continents. The entire planet watches us, and has been since Edison rolled film in West Orange and the nickelodeons opened on the Lower East Side, when a generation of immigrants walked off the boats and into the dark of a movie theater and saw, for the first time, the country they had crossed an ocean to reach. The streets were paved with gold, and the gold was light, and the light came out of a projector.
That projector is leaving the country.
The United States of America took that impulse and turned it into the most powerful cultural export in history. Not oil. Not wheat. Not steel. Not the automobile. Stories. American stories, told through American cameras, performed by American actors, built by American hands, projected onto screens in 195 countries on six continents. The entire planet watches us, and has been since Edison rolled film in West Orange and the nickelodeons opened on the Lower East Side, when a generation of immigrants walked off the boats and into the dark of a movie theater and saw, for the first time, the country they had crossed an ocean to reach. The streets were paved with gold, and the gold was light, and the light came out of a projector.
That projector is leaving the country.
THE PROBLEM
On December 31, 2025, Section 181 of the Internal Revenue Code expired. If you have never heard of Section 181, you are not alone. Its expiration is one of the most consequential policy failures in the recent history of American cultural production, and almost no one outside of the film industry is talking about it.
Section 181, first enacted in 2004 as part of the American Jobs Creation Act, allowed film and television producers to deduct up to $15 million in qualified production costs in the year those costs were incurred, rather than capitalizing them and depreciating them over time. For productions in economically distressed areas, the cap rose to $20 million. It was the only federal tax incentive in the United States specifically designed to keep film and television production on American soil. It required that at least 75 percent of total compensation go to services performed within the United States. It was renewed multiple times under both Republican and Democratic administrations. And then, at the end of 2025, Congress let it die.
The bipartisan CREATE Act, introduced by Representatives Judy Chu and Nicole Malliotakis and Senators Raphael Warnock and Marsha Blackburn, would have extended Section 181 through 2030 and raised the deduction cap to $30 million, or $40 million in distressed areas. It had support from the Motion Picture Association, the Directors Guild of America, IATSE, SAG-AFTRA, Jon Voight, and the Trump administration. It did not pass.
The result is simple and devastating: The United States of America, the country that invented motion pictures, now has no federal incentive to make them here.
On December 31, 2025, Section 181 of the Internal Revenue Code expired. If you have never heard of Section 181, you are not alone. Its expiration is one of the most consequential policy failures in the recent history of American cultural production, and almost no one outside of the film industry is talking about it.
Section 181, first enacted in 2004 as part of the American Jobs Creation Act, allowed film and television producers to deduct up to $15 million in qualified production costs in the year those costs were incurred, rather than capitalizing them and depreciating them over time. For productions in economically distressed areas, the cap rose to $20 million. It was the only federal tax incentive in the United States specifically designed to keep film and television production on American soil. It required that at least 75 percent of total compensation go to services performed within the United States. It was renewed multiple times under both Republican and Democratic administrations. And then, at the end of 2025, Congress let it die.
The bipartisan CREATE Act, introduced by Representatives Judy Chu and Nicole Malliotakis and Senators Raphael Warnock and Marsha Blackburn, would have extended Section 181 through 2030 and raised the deduction cap to $30 million, or $40 million in distressed areas. It had support from the Motion Picture Association, the Directors Guild of America, IATSE, SAG-AFTRA, Jon Voight, and the Trump administration. It did not pass.
The result is simple and devastating: The United States of America, the country that invented motion pictures, now has no federal incentive to make them here.
THE COMPETITION
While we argue, the world acts.
The United Kingdom offers a 25 to 34 percent expenditure credit through its Audio Visual Expenditure Credit. Canada offers a 25 percent federal labor tax credit that stacks on top of provincial incentives reaching 35 to 70 percent in places like British Columbia and Ontario. Australia provides a 30 percent offset for features and 20 percent for television. Ireland offers 32 percent. Hungary offers 30 percent. South Africa offers 25 percent. Colombia, the Czech Republic, Romania, Bulgaria, Argentina, Germany, France, South Korea, New Zealand, Jordan, Morocco, the list goes on, and every country on it is spending real money to take American productions off American soil.
These are not abstract losses. When a production shoots in Budapest instead of Brooklyn, every dollar spent on lumber, catering, hotels, car rentals, dry cleaning, grip rentals, and craft services leaves the American economy. Every crew member who would have worked in Burbank or the Bronx or Bayonne does not work. Every small business that would have supplied the shoot does not get the call. The ripple effect runs from the soundstage to the sandwich shop, and when the soundstage is in Prague, the sandwich shop in Paterson struggles to stay in business.
The numbers bear this out. According to FilmLA, the Greater Los Angeles area saw a nearly 20 percent decline in film and TV production in 2023. California’s total production spend dropped 22 percent year over year in Q4 2025. Meanwhile, the UK and Canada posted double-digit gains in both filming count and production spend in the same period.
America is not losing this fight because it lacks talent or locations or infrastructure. America is losing this fight because it is the only major filmmaking country on earth that refuses to compete at the federal level.
While we argue, the world acts.
The United Kingdom offers a 25 to 34 percent expenditure credit through its Audio Visual Expenditure Credit. Canada offers a 25 percent federal labor tax credit that stacks on top of provincial incentives reaching 35 to 70 percent in places like British Columbia and Ontario. Australia provides a 30 percent offset for features and 20 percent for television. Ireland offers 32 percent. Hungary offers 30 percent. South Africa offers 25 percent. Colombia, the Czech Republic, Romania, Bulgaria, Argentina, Germany, France, South Korea, New Zealand, Jordan, Morocco, the list goes on, and every country on it is spending real money to take American productions off American soil.
These are not abstract losses. When a production shoots in Budapest instead of Brooklyn, every dollar spent on lumber, catering, hotels, car rentals, dry cleaning, grip rentals, and craft services leaves the American economy. Every crew member who would have worked in Burbank or the Bronx or Bayonne does not work. Every small business that would have supplied the shoot does not get the call. The ripple effect runs from the soundstage to the sandwich shop, and when the soundstage is in Prague, the sandwich shop in Paterson struggles to stay in business.
The numbers bear this out. According to FilmLA, the Greater Los Angeles area saw a nearly 20 percent decline in film and TV production in 2023. California’s total production spend dropped 22 percent year over year in Q4 2025. Meanwhile, the UK and Canada posted double-digit gains in both filming count and production spend in the same period.
America is not losing this fight because it lacks talent or locations or infrastructure. America is losing this fight because it is the only major filmmaking country on earth that refuses to compete at the federal level.
THE COALITION
The Coalition for American Production (CAP) is a nationwide alliance of businesses and professionals who make up the backbone of American film and television production: service providers, manufacturers, rental houses, technical suppliers, prop houses, lumber yards, catering companies, lighting vendors, and the thousands of small businesses that most people never think about when they think about the movies. These are not studio executives or movie stars. These are the people who build the sets, stock the trucks, and keep the cameras running. They are the fourth-generation owner of a prop house in New York. They are the grip rental company in New Jersey. They are the lumber mill in Georgia. And they are watching their livelihoods walk out of the country one production at a time.
CAP is currently lobbying for this crucial bill in Washington, and they need your support. In February 2026, the coalition brought its members to Capitol Hill for a lobby day, meeting with lawmakers on both sides of the aisle. The Trump administration has met with CAP’s senior leadership and, according to the coalition, demonstrated deep knowledge of the issue, recognized its importance in sustaining American jobs and strengthening local economies, and encouraged continued bipartisan efforts. The administration acknowledged the urgency of restoring American competitiveness at a time when global production is rapidly shifting overseas.
What CAP is asking for is not complicated. It is not a handout or a bailout. It is a tax incentive, structured to reward production that happens on American soil with American workers spending American dollars in American communities. Thirty-seven states already offer their own versions of this incentive. What is missing is the federal floor, the baseline that tells the rest of the world that the United States is serious about keeping its own industry at home.
The Coalition for American Production (CAP) is a nationwide alliance of businesses and professionals who make up the backbone of American film and television production: service providers, manufacturers, rental houses, technical suppliers, prop houses, lumber yards, catering companies, lighting vendors, and the thousands of small businesses that most people never think about when they think about the movies. These are not studio executives or movie stars. These are the people who build the sets, stock the trucks, and keep the cameras running. They are the fourth-generation owner of a prop house in New York. They are the grip rental company in New Jersey. They are the lumber mill in Georgia. And they are watching their livelihoods walk out of the country one production at a time.
CAP is currently lobbying for this crucial bill in Washington, and they need your support. In February 2026, the coalition brought its members to Capitol Hill for a lobby day, meeting with lawmakers on both sides of the aisle. The Trump administration has met with CAP’s senior leadership and, according to the coalition, demonstrated deep knowledge of the issue, recognized its importance in sustaining American jobs and strengthening local economies, and encouraged continued bipartisan efforts. The administration acknowledged the urgency of restoring American competitiveness at a time when global production is rapidly shifting overseas.
What CAP is asking for is not complicated. It is not a handout or a bailout. It is a tax incentive, structured to reward production that happens on American soil with American workers spending American dollars in American communities. Thirty-seven states already offer their own versions of this incentive. What is missing is the federal floor, the baseline that tells the rest of the world that the United States is serious about keeping its own industry at home.
THE ARGUMENT
There is a version of this argument that is purely economic, and it is persuasive on its own terms. The U.S. film and television industry directly employs more than 2.5 million people. It generates hundreds of billions of dollars in economic activity annually. Every dollar spent on a domestic production multiplies through local economies in ways that are measurable and documented.
But there is a deeper argument, and it is the one that should keep lawmakers up at night.
American cinema is not just an industry. It is the primary vehicle through which the rest of the world understands what America is. Every film that ships overseas carries with it a version of this country, its values, its contradictions, its beauty, its mess. When those films are made here, they are made by people who live here, who know the texture of American life from the inside, who bring the specific gravity of American experience to every frame. When those films are made in Romania or Bulgaria or Hungary, with American money and American scripts but foreign crews and foreign locations dressed up to look like Anywhere, USA, something essential is lost. Not just jobs. Voice. Perspective. Authenticity. The thing that makes American storytelling American.
From the cave to the campfire to the nickelodeon to the multiplex to the streaming platform, storytelling has been the thread that holds civilization together. The country that controls its own stories controls its own identity. The country that outsources its stories outsources its soul.
That is not an economic argument. That is a national security argument.
There is a version of this argument that is purely economic, and it is persuasive on its own terms. The U.S. film and television industry directly employs more than 2.5 million people. It generates hundreds of billions of dollars in economic activity annually. Every dollar spent on a domestic production multiplies through local economies in ways that are measurable and documented.
But there is a deeper argument, and it is the one that should keep lawmakers up at night.
American cinema is not just an industry. It is the primary vehicle through which the rest of the world understands what America is. Every film that ships overseas carries with it a version of this country, its values, its contradictions, its beauty, its mess. When those films are made here, they are made by people who live here, who know the texture of American life from the inside, who bring the specific gravity of American experience to every frame. When those films are made in Romania or Bulgaria or Hungary, with American money and American scripts but foreign crews and foreign locations dressed up to look like Anywhere, USA, something essential is lost. Not just jobs. Voice. Perspective. Authenticity. The thing that makes American storytelling American.
From the cave to the campfire to the nickelodeon to the multiplex to the streaming platform, storytelling has been the thread that holds civilization together. The country that controls its own stories controls its own identity. The country that outsources its stories outsources its soul.
That is not an economic argument. That is a national security argument.
THE PATH FORWARD
The CREATE Act is still on the table. Section 181 can be reintroduced. The mechanism exists. The bipartisan will exists. The administration has signaled interest. What is missing is volume, the sustained public pressure that turns a policy conversation into a policy priority.
CAP is building that volume. Every small-business owner who joins the coalition, every letter sent to a member of Congress, every lobby day in Washington, every conversation that moves this issue from the trade press to the front page adds another voice to the chorus. This is not a Hollywood issue. This is an American jobs issue, a small-business issue, a Main Street issue, and it touches every state in the union.
New Jersey knows this better than anyone. This state has watched what happens when the incentive works. The state’s own tax credit program, reinstated in 2018 and extended through 2049, has turned Jersey into the fastest-growing production market in the country. The model is proven. The economics are clear. What New Jersey has done at the state level, the federal government can do at the national level, and the result would be transformative: a competitive, permanent, stackable federal incentive that complements state programs, attracts international productions to American soil, and tells every grip, gaffer, prop maker, caterer, and set builder in this country that their government believes their work matters.
The projector does not have to leave the country. The stories do not have to be told somewhere else. The streets are still paved with gold, if we are willing to fight for the light that makes the gold visible.
CAP is fighting. The question is whether Washington is listening.
To learn more, join the coalition, or contact your representative, visit usacap.org.
The Coalition for American Production (CAP) is a nationwide alliance of businesses and professionals advocating for a federal film and television production tax incentive to keep jobs, investment, and creative production in the United States. For more information, visit usacap.org or contact [email protected].
The CREATE Act is still on the table. Section 181 can be reintroduced. The mechanism exists. The bipartisan will exists. The administration has signaled interest. What is missing is volume, the sustained public pressure that turns a policy conversation into a policy priority.
CAP is building that volume. Every small-business owner who joins the coalition, every letter sent to a member of Congress, every lobby day in Washington, every conversation that moves this issue from the trade press to the front page adds another voice to the chorus. This is not a Hollywood issue. This is an American jobs issue, a small-business issue, a Main Street issue, and it touches every state in the union.
New Jersey knows this better than anyone. This state has watched what happens when the incentive works. The state’s own tax credit program, reinstated in 2018 and extended through 2049, has turned Jersey into the fastest-growing production market in the country. The model is proven. The economics are clear. What New Jersey has done at the state level, the federal government can do at the national level, and the result would be transformative: a competitive, permanent, stackable federal incentive that complements state programs, attracts international productions to American soil, and tells every grip, gaffer, prop maker, caterer, and set builder in this country that their government believes their work matters.
The projector does not have to leave the country. The stories do not have to be told somewhere else. The streets are still paved with gold, if we are willing to fight for the light that makes the gold visible.
CAP is fighting. The question is whether Washington is listening.
To learn more, join the coalition, or contact your representative, visit usacap.org.
The Coalition for American Production (CAP) is a nationwide alliance of businesses and professionals advocating for a federal film and television production tax incentive to keep jobs, investment, and creative production in the United States. For more information, visit usacap.org or contact [email protected].
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This story appeared in the inaugural issue of Socko! Magazine [May, 2026]. Click here to subscribe
Adam Nelson has lived at the intersection of performance and American storytelling for more than three decades. As the founder of Workhouse, the New York public relations agency he has run since 1999, he has built an award-winning firm representing filmmakers, artists, festivals, and cultural institutions. A professor at the New Jersey Film Academy, he is currently training a new generation for the state's rapidly expanding production economy. His film Food for Thought, directed by Gary Hanna, was a finalist at the AP'N3 Film Challenge and went on to win Best Silent Film at the 2026 Absurd Film Festival in Milan. Huckleberry Jim, his debut novel, is querying literary agents now. Nelson is co-founder of SOCKO! Magazine
