Hollywood on the Brink: Trump’s Tariff Threat and the Ninth National Emergency

The entertainment industry is bracing for a seismic shift as President Donald Trump hints at declaring a national emergency to impose a 100% tariff on foreign movies—a move he claims is necessary to prevent Hollywood’s “very fast death.” If enacted, this would mark the ninth national emergency under Trump’s second term, adding to his record of using emergency powers to bypass Congress and reshape economic policy.

The Emergency Looming Over Hollywood

Trump’s proposed tariff targets foreign films produced in countries that offer tax incentives to lure Hollywood studios, which he argues undermines U.S. cultural dominance. The administration frames this as a national security issue, citing a 2025 White House report that claims foreign subsidies have cost the U.S. $15 billion annually in lost production jobs.

This follows the April 2, 2025, trade emergency, which imposed a 10% global tariff on imports to address a $1.2 trillion goods trade deficit. While that emergency exempted critical sectors like semiconductors and pharmaceuticals, the movie tariff lacks such carve-outs, raising alarms for streaming giants and studios reliant on international content.

A Pattern of Emergency Overreach

Trump’s use of emergency declarations has drawn fire from legal experts and political opponents. By mid-2025, he had already declared eight national emergencies in his second term alone—more than any modern president—spanning everything from border militarization to tariffs on China. Critics, including the Brennan Center for Justice, argue these actions stretch the International Emergency Economic Powers Act (IEEPA) beyond its intended purpose, which is to address immediate crises, not long-standing policy disputes.

The California v. Trump lawsuit, filed by Governor Gavin Newsom, challenges the April 2025 tariffs’ legality, asserting they violate IEEPA’s requirement that emergencies be tied to urgent threats. If successful, this could block the movie tariff before it takes effect.

Investor Implications: Risks and Opportunities

The potential emergency has sent shockwaves through entertainment stocks.

• Streaming Services at Risk: Netflix, Warner Bros., and Disney rely on foreign-produced content to fuel their platforms. A 100% tariff would force studios to reshoot films domestically, raising costs and delaying releases.
• Reshoring Plays: Companies in construction and equipment rentals could benefit if studios shift production back to the U.S., boosting demand for soundstages, crew housing, and infrastructure.
• Legal Uncertainty: Investors must weigh the tariff’s potential economic impact against the likelihood of judicial or congressional pushback.

The Economic Calculus

The White House projects that tariffs on foreign movies would create 2.8 million jobs in U.S. film production and support industries, citing a 2024 analysis that claims tariffs on goods alone boosted GDP by $728 billion. However, critics argue this ignores retaliatory measures by trade partners and inflationary pressures.

A 100% tariff could also accelerate the “reshoring” of film production, benefiting states like Georgia and Louisiana, which already offer incentives to attract studios. Conversely, sectors tied to global collaborations—like animation or international co-productions—face steep headwinds.

Conclusion: Navigating the Emergency Crossroads

Trump’s proposed movie tariff represents both a high-stakes gamble and a test of executive power. Investors should consider three key factors:

1. Legal Outcomes: If courts strike down the April 2025 tariffs, the movie emergency may never materialize.
2. Market Reactions: Stocks in entertainment and reshoring sectors will likely remain volatile until the legal and political landscape clarifies.
3. Global Retaliation: Trade partners may retaliate with their own tariffs, risking a broader economic conflict.

For now, the safest bets are companies positioned to benefit from reshoring—such as construction firms in film hubs—while investors in streaming stocks may want to hedge against regulatory uncertainty. The administration’s ninth emergency could redefine Hollywood’s future, but its fate now rests on the courts and the markets.