In March 2026, comedian David Spade didn’t mince words about Hollywood’s crisis. Speaking on his “Fly on the Wall” podcast, he directly blamed California Governor Gavin Newsom and Los Angeles Mayor Karen Bass for what he called the entertainment industry’s “terrifying” downfall. His evidence wasn’t hypothetical—he pointed to the bankruptcy of CBS Radford Studio Center in Studio City as a concrete example of how far the decline has progressed.
What was once a thriving production hub is now closing its doors, a symbol of the broader collapse affecting thousands of workers across the industry. Spade’s criticism centers on a perfect storm of departing productions, lost jobs, and declining economic activity in Los Angeles. Between the two executives’ policies—or lack thereof—and the industry’s structural challenges, Hollywood is hemorrhaging talent and investment. This article examines what Spade said, what the data actually shows, how government officials responded, and whether proposed solutions like tax incentives and union negotiations could reverse the damage.
Table of Contents
- What Did David Spade Actually Say About Hollywood’s Crisis?
- The Hard Numbers Behind Hollywood’s Job Losses
- Mayor Bass and Governor Newsom’s Defense
- How Tax Credits and Incentives Factor Into the Competition
- Union Negotiations and Labor Cost Pressures
- The Ripple Effect Beyond Just Studios
- What Would Reversing the Decline Actually Require?
- What’s Next for Hollywood?
- Conclusion
What Did David Spade Actually Say About Hollywood’s Crisis?
Spade’s statement was blunt: “the Hollywood industry is dying.” He framed California’s leadership as complicit in this decline, suggesting that neither Newsom nor Bass had taken adequate steps to prevent the exodus of productions and workers. The CBS Radford Studio Center bankruptcy became his smoking gun—a facility that had been a cornerstone of Hollywood production for decades, now unable to survive the changing economic landscape. The comedian wasn’t alone in his assessment.
His co-host Dana Carvey echoed the concerns, agreeing that the situation had become dire. Carvey went further, suggesting that solutions were available if leadership would act on them—specifically mentioning tax breaks and union negotiations as potential remedies. This wasn’t partisan ranting; it was an industry insider describing what he was watching happen in real time.
The Hard Numbers Behind Hollywood’s Job Losses
The statistics backing Spade’s alarm are difficult to dismiss. Hollywood lost 17,000 jobs in 2025 alone, a staggering figure that translates to real people leaving the industry, relocating to other states, or leaving the workforce entirely. For members of the Directors Guild of America (DGA), the situation is even bleaker—employment is down approximately 40%, meaning nearly two of every five directors aren’t finding work in an industry that once seemed to have endless demand. However, it’s important to note that not all of these losses are purely attributable to government policy.
Production companies are also responding to streaming competition, changing audience preferences, and the aftermath of the 2023 writers’ and actors’ strikes. That said, policy decisions around taxation and labor regulation absolutely matter. Filming permits in Los Angeles declined 16% in just the past year, while the longer-term trend shows a 50% decline in permits since 2018. This six-year erosion suggests that the problem isn’t a temporary blip but a systemic shift driven by both immediate policy and long-term industry changes.
Mayor Bass and Governor Newsom’s Defense
When confronted with criticism, Mayor Karen Bass’s press office didn’t concede the argument. They pointed to her record championing the entertainment industry, arguing that “it’s a bedrock of our middle class.” This framing acknowledged the industry’s importance while defending her actions.
more substantively, they highlighted that Bass had backed California’s Film and TV Tax Credit Program as speaker of the State Assembly and had supported its expansion within the past year. The tax credit program is designed to make filming in California more competitive with other states by offering financial incentives to productions. Governor Newsom has similarly maintained that his administration supports the industry, though critics argue the support hasn’t been aggressive enough given the scale of job losses and production departures to states like Georgia, Texas, and Louisiana.
How Tax Credits and Incentives Factor Into the Competition
States like Georgia have aggressively pursued entertainment production by offering generous tax credits—currently 20% for in-state expenses. This has made it cheaper to film there than in California, despite California’s natural advantages in crew expertise, infrastructure, and established relationships. California’s Film and TV Tax Credit Program offers up to 25% in some cases, which sounds competitive on paper, but the application process and funding caps have limited its effectiveness. Dana Carvey’s suggestion that tax breaks could help revive the industry isn’t just his opinion—it’s supported by industry data.
When competing states raise their incentives, productions migrate. When California’s incentives become more competitive, some productions return. But there’s a tradeoff: generous tax credits mean less tax revenue for the state, forcing cuts elsewhere. This creates tension between supporting an industry that does employ thousands and managing state finances broadly. The question isn’t whether tax credits work, but whether California is willing to fund them at a level that makes the state genuinely competitive.
Union Negotiations and Labor Cost Pressures
Dana Carvey also identified union negotiations as critical to recovery. Hollywood unions—particularly the Writers Guild of America (WGA) and Screen Actors Guild (SAG-AFTRA)—have significant power in determining labor costs. The 2023 strikes won better contracts but also raised production costs for studios, which then accelerated their shift toward cheaper out-of-state filming.
This creates a difficult dynamic: crews and talent reasonably want fair compensation and working conditions, yet higher labor costs make out-of-state production more attractive. Solutions likely require negotiation that balances industry health with worker protections, but that’s complicated territory where government incentives alone can’t solve the problem. Union contracts are negotiated between studios and workers, not between workers and government. However, governments can influence the equation through tax policy and incentives that offset higher labor costs.
The Ripple Effect Beyond Just Studios
The job losses extend far beyond actors and directors. Cinematographers, gaffers, grips, set designers, costume departments, craft services, and dozens of other trades depend on consistent production activity. These are middle-class jobs that supported Los Angeles’s economy and broader California tax base.
When productions move to Georgia or Texas, those entire crews lose income. This isn’t just an entertainment industry story—it’s an economic development story. Every filming permit that doesn’t happen means vendors, equipment rental companies, hotels, restaurants, and transportation services lose business. The 50% decline in filming permits since 2018 represents hundreds of millions of dollars in economic activity that has vanished from the Los Angeles area.
What Would Reversing the Decline Actually Require?
Reversing Hollywood’s decline isn’t impossible, but it would require coordinated action on multiple fronts. Tax credits at levels competitive with Georgia and Louisiana would be necessary but not sufficient.
Streamlined permitting processes, infrastructure investment in studios, and labor agreements that balance worker protections with industry competitiveness would all need attention. Some argue that Hollywood’s decline is also driven by narrative and perception—that the industry itself needs to refocus on what audiences want rather than waiting for government rescue. Others point to the reality that every percentage-point improvement in tax competitiveness could influence where a $50 million production decides to film.
What’s Next for Hollywood?
As of March 2026, the situation remains in flux. Mayor Bass and Governor Newsom have both defended their support for the entertainment industry, but whether existing incentive programs and proposed expansions will be sufficient remains uncertain. The next year will be critical—if productions continue to migrate and job losses accelerate, pressure on government to act more aggressively will only grow.
Spade and Carvey’s public criticism may be what moves the needle. Industry figures with platforms can influence political will in ways that industry associations sometimes cannot. Whether Newsom and Bass respond with more aggressive tax incentives, streamlined regulations, or other support mechanisms could determine whether 2026 marks a turning point or a continued decline.
Conclusion
David Spade’s claim that California’s leadership bears responsibility for Hollywood’s decline is rooted in real data: 17,000 jobs lost in 2025, a 40% decline in DGA employment, and a 50% drop in filming permits since 2018. While not all industry challenges stem from government policy—streaming competition and labor costs are significant factors—tax incentives and permitting processes absolutely influence where productions choose to film.
The debate going forward isn’t whether Hollywood matters to California’s economy; both Mayor Bass and Governor Newsom acknowledge that it does. The debate is whether current support mechanisms are sufficient or whether more aggressive incentives, faster permitting, and labor agreements need to be on the table. For the thousands of workers in the industry and the broader Los Angeles economy, the answer to that question matters considerably.
