Democratic Gains Put Hollywood Tax Credits and Media Oversight in Focus

Democrats’ midterm victory has opened questions for Hollywood studios and broadcasters as Washington prepares for the final two years of President Trump’s term. An election shaped by the president, prices and the war in Iran could also affect production tax credits, public media funding and congressional scrutiny of media companies.

Hollywood’s leading legislative goal remains securing a federal tax incentive before the end of the year. The proposal has bipartisan backing, including support from Trump and Adam Schiff. But the transition in congressional power could complicate efforts to pass it, with Republicans occupied by the election fallout and a leadership contest. House Democrats could also choose to postpone bipartisan agreements until they take control in the next Congress.

Trump added uncertainty at a rally last Friday when he questioned whether to provide the credits. After initially suggesting he probably would, he asked the crowd for its view and received boos. He then said the matter would require further consideration. The industry continues to draw encouragement from his initial indication of support.

Democrats’ greater support for Hollywood could improve the proposal’s prospects in the 120th Congress, although lawmakers would have to begin the legislative process again. Of its 31 Republican cosponsors across the House and Senate, 10 will not return next year. A delay could also weaken the argument that the industry needs immediate assistance. In September, Schiff stressed the importance of acting while lawmakers and the president remained focused on the issue.

Democratic control of Congress will not change control of the Federal Communications Commission, but it is expected to increase scrutiny of chairman Brendan Carr. His pressure on broadcasters over Jimmy Kimmel’s jokes and inquiries into political commentary on “The View” have drawn opposition from congressional Democrats. They regard his actions as part of Trump’s efforts to suppress opposing views and are likely to use subpoena powers to examine controversies involving the agency.

Public broadcasting supporters could find an opening to seek renewed federal funding. The Corporation for Public Broadcasting ceased operating last year after Congress removed $1.1 billion in funding. The loss put pressure on hundreds of local stations, prompting some to consolidate, and removed a significant funding source for PBS and NPR. Restoring support would face opposition from conservatives who accuse the organizations of liberal bias.

Advocates also want a broader approach than rebuilding the corporation established in 1967. Rima Dael, chief executive of the National Federation of Community Broadcasters, urged the incoming Congress to support public and community media around current local needs. Her statement emphasized access through broadcasting and online services, programming in the languages communities use, uneven internet access and misinformation amplified by artificial intelligence.

The House Oversight Committee could also examine media companies’ dealings with Trump, although its investigative priorities remain uncertain. Potential subjects include the “Melania” documentary agreement, payouts involving his lawsuits against media and technology companies, and the Ellison family’s efforts to secure his approval for the Paramount-Skydance and Paramount-Warner Bros. mergers. Such investigations could face lengthy executive privilege disputes, but successful inquiries might reveal internal communications about those dealings.