The Economics of William Friedkin, Academy Award Winning Director

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In the late ‘90s entertainment writer Peter Biskind published Easy Riders Raging Bulls, an unputdownable history of the film business in the 1970s. This writer gave out countless copies to friends, and in a broad sense it's fair to say that Biskind's book very much revived interest in ‘70s films among moviegoers.

It also generated a great deal more interest in the people behind the films. Indeed, while his just-released biography to some degree debunked Biskind's assertion that directors trumped producers in 1970s Hollywood, it should at the very least be said that Biskind's book made William Friedkin's autobiography, The Friedkin Connection, a more bankable concept to publishers. Friedkin's life story is a very worthwhile read.

As for Friedkin's economics, though this reviewer has suspicions about which way the legendary director leans, The Friedkin Connection is happily free of politics. This is very much to the director's credit, but despite Friedkin leaving his political and economic views out of the story, his story certainly offers up excellent economic lessons that will be written about here.

First up is the impressively arrogant presumption of anti-trust. Reduced to the basics, anti-trust attorneys at the Justice Department block the merger of certain corporations, and then in the case of Microsoft seek the breakup of very successful ones. They do all this on the assumption that certain businesses will dominate the market to the detriment of same absent government intervention. Of course to be right, anti-trust lawyers must be able to see into the future of commerce in ways that top investors try to, but rarely succeed at doing.

To show what an embarrassing lie anti-trust is, we need only go to page one of Friedkin's memoir. There he writes that the late artist Jean-Michael Basquiat once admiringly sent the great director some of his early art as a gift. Basquiat was unknown at the time, but Friedkin notes that a Basquiat painting from that period recently "sold at auction for fourteen million dollars." In response to Basquiat reaching out with his art, Friedkin "threw them in the wastebasket and never acknowledged his note."

The director of The French Connection (winner, best picture, 1971) and The Exorcist also acknowledges that around the same time Basquiat tried to get his attention, Prince contacted him about directing one of his music videos. As Friedkin writes, the "music was original but not something I appreciated," and "I didn't respond." Friedkin also declined the "opportunity to be one of the producers of Star Wars." About Gene Hackman, Popeye in The French Connection, Friedkin concluded ahead of production that "there was no way this guy could play Popeye."

All of the above merits mention (Friedkin similarly was offered an ownership stake in Mike Tyson's future earnings, not to mention one third ownership of the Boston Celtics) because whatever one thinks of the director, most would agree that in matters artistic he's an expert. Despite his expertise Friedkin plainly failed to predict what would be popular in the future at a staggering cost to his future wealth position. If Friedkin couldn't very easily see into the future of an entertainment world that for a time he was at the top of, how or why do we expect the salary takers at the DOJ to correctly see what's ahead?

Notable here is that Microsoft was eventually caught somewhat asleep by the Internet and insurgents like Google and Facebook such that its dominant position eventually disappeared. The company's stock has been flat for years. As for Friedkin, though he can still make movies (more on that later), he can no longer claim the privileged perch he enjoyed in the 1970s. He writes that in "the space of a year, flush with success and an overblown opinion of my talents, I failed to appreciate the genius of both Lucas and Spielberg. Soon the American film industry would belong to them." How much better off we'd all be if federal bureaucrats would read Friedkin's life story. Put very plainly, free markets have a way of correcting the near-term dominance of individuals and companies.

Considering education policy, right and left both possess a politically correct worship of it. Despite the fact that the U.S. commercial landscape is littered with impatient entrepreneurs who didn't have time for schooling, politicians keep talking it up as though knowledge of calculus, history and science is the path to achievement. Friedkin's story is but the latest to reveal that curiosity and hard work easily trump education on its very best day.

About school, Friedkin writes that "Grammar school and high school never engaged me. I went only because it was mandatory." He goes on to write that "My formal education ended in 1953, when I graduated from Senn High School on the North Side." So while Friedkin couldn't be bothered with school, this didn't mean he wasn't curious. Curiosity was his educator, and the same is true today. Indeed, while Quentin Tarantino didn't attend USC's film school, his work at a video store exposed him to the work of the great directors.

In Friedkin's case, he got a job at local television station in Chicago, and then in his free time immersed himself in the films of Orson Welles and Alfred Hitchcock. As he puts it, "I became aware of the techniques of storytelling possible only in motion pictures." Friedkin learned by doing, and eventually helmed an award winning documentary titled The People vs. Paul Crump. The successful documentary proved his ticket to Hollywood.

It doesn't take a read of this book review to know what was next. Friedkin eventually ascended to the top of the director/auteur heap, but what's interesting about all this is that as the son of Russian immigrants, he plainly acknowledges that "My DNA suggested no hint of success at anything."

The above can't be stressed enough. Among both major political parties, there's a strain within each that seeks to close the borders to immigrants. One of the arguments made is that the newcomers are a burden, they're dirty, they won't assimilate, they're not bright, they push wages down to the detriment of union workers, etc. Natural born citizenry can be such an ass.

People willing to leave family, friends, and sometimes the comforts of home represent the world's ambitious. In Friedkin's case, naturally he didn't look like much of a hot prospect in the initial sense owing to family members presumably still stuck in a more backwards Ukrainian culture. When asked why she wanted U.S. citizenship, William Peter Blatty's (author of The Exorcist) mother explained that it's "For my children." At one point in Blatty's childhood his mother (more on this later) was reduced to begging near the Paris Theatre, and then the Blatty family similarly probably didn't look too hot upon arrival in the U.S. But ambition is priceless, and as Friedkin and Blatty's stories make clear, immigrants and their offspring are more often than not ambitious treasures whose arrival we should encourage.

Though countries with open markets are never poor (think Hong Kong, Singapore, to some degree the U.S.), there are the holdouts who blanch at free trade. Friedkin's story reminds us that beyond trade being a liberty thing, it's also what makes life so much more interesting and abundant. As he points out, the French film Z informed the making of The French Connection, his cameraman's most notable work was an "independent feature in Puerto Rico," while his camera operator (Enrique Bravo) was "a heavyset Cuban refugee." Free trade, as the making of The French Connection reveals, is also about knowledge and the exchange of same. Imagine how bland our restaurants would be if we'd repelled everything not British long ago?

Considering taxes, Friedkin once again didn't include his politics in his life story. Still, his life as a filmmaker brings with it examples that reveal the importance of light tax policy.

Indeed, while Hollywood types seem to revel in electing leadership that will raise their income taxes, when it comes to producing films, producers and directors frequently migrate to the best tax deals. Louisiana is notable here, and as Friedkin writes, the tax breaks offered there make it the "go-to state for most film production and a lot of television shows produced in the United States." Taxes, as Friedkin makes plain, are a barrier, they're a price, and they're a cost placed on production. Supply side economics is about removing the tax, monetary, regulatory, and trade barriers to production, and Friedkin reveals yet again what Classical School (‘supply-side' just a modern term for thinking that's long been in existence) thinkers have long known: on the individual level we're all supply-siders.

Taking the tax argument further, many in Hollywood oddly call for higher levies on top earning individuals and corporations. Friedkin's story is reminder of how perilous this can be.

As he retells it, after having directed a few films in Hollywood, he could claim no real box office or critical success. That was true until Dick Zanuck, with $1.5 million lying around, offered it up and it eventually paid for Best Picture winner The French Connection. The rich love to talk about how they don't need all their money, that they're happy to hand it over to politicians, but when The French Connection was made Friedkin surely wasn't rich. Thank goodness corporate taxation wasn't so oppressive at the time (in the 1930s it was) such that Twentieth Century-Fox had to hand over its surplus to the federal government. As Friedkin's breakout film reveals, taxes meant to reduce the surplus of individuals and corporations are often paid by the non-rich in the form of reduced opportunity. When taxes are low there's more capital available for risky ventures, including a film that even Friedkin acknowledged wasn't a sure thing. Low taxes open up opportunities for people and business ideas. They allow us to take risks, to succeed and fail, to experiment.

Regarding the ‘wealth gap,' or the income inequality that has so many up in arms, they too should all approach The Friedkin Connection as required reading. That's the case because Friedkin's story is a reminder that wealth in a free society is not static. It goes up and down with great regularity. High risk, high reward is the movie business.

Though Friedkin made pretty good money upon arrival in Hollywood in the ‘60s, by the end of the decade his career had stalled. As he puts it, "I had signed up for unemployment benefits for the second time in my life [when] Larry Auerbach called" with news that Zanuck wanted to meet about making The French Connection. The latter of course won Best Picture and netted Friedkin Best Director, and then two years later Friedkin helmed The Exorcist on the way to ten Oscar nominations and huge global box office.

Having signed up for unemployment just a few years before, by the mid ‘70s Friedkin was living high. As he writes, "I had come from a one-room apartment in Chicago to the finest hotel suites in the world, first class air travel, the finest tables in the best restaurants, beautiful women who sought my company, top of the line all the way. I was able to buy a sixteen-room apartment on Park Avenue and Fifty-Fifth Street that took up an entire floor of a twelve-story Belle Epoque building, and a house on an acre in Bel Air, California. I vaulted to the top of the Hollywood A-list, and thought I'd stay there forever." Sadly, and policy is worsened as a result, politicians led by naïve economists too often believe what Friedkin did during his ‘70s heyday: that the success would never stop. As a result, the policy debate is compromised given the desire of some to reduce the wealth gap with heavy taxes placed on the rich.

But as Friedkin's story makes plain, there's no need. Wealth is not static. The rich team picture changes on an annual basis. Friedkin writes about his success that "I thought I had the formula," but by 1985, after mediocre box office for To Live and Die in L.A., the onetime toast of Los Angeles was no longer bankable. As his very own agent said about him, "Friedkin can't get a job in this town."

Considering Blatty, while his mother as previously mentioned used to beg out in front of the Paris Theatre, The Exorcist eventually played there. Back to Friedkin, to his credit he can still get a movie made today. Notable about this is that the financier of his last film, Killer Joe, was Nicholas Chartier. Chartier began his career as a janitor at Disneyland in Paris, but as mentioned put together the financing for Killer Joe, the latter based on a script by someone - Tracy Letts - who spent part of his childhood in a Durant, Oklahoma trailer park. Wealth is fluid, and people move up and down. To worry about the wealth gap is a an economic-sapping mistake in our land of opportunity.

Lastly, conservatives often decry "liberal Hollywood." The view of this libertarian is that Hollywood's message in films is actually far more conservative than are the politics expressed by many of the industry's leading lights. Whatever the answer, conservatives needn't fret too much. As Friedkin reminds the reader early on, "A director gets to make a film only because a studio executive or financier thinks it could make money. It's almost impossible to choose a project with no eye to the marketplace." Yes, Hollywood swings left, but ultimately the tastes of a center-right country drive what is created.

In short, Friedkin makes plain in his endlessly interesting memoir that box office is king. Thank goodness for that. What a shame that so many in Hollywood don't realize that taxes on the moving target that is the "rich" make artistic experimentation less abundant. More to the point, how many William Friedkins never got their careers off of the ground thanks to insufficient funding for what is always a risky endeavor? Hopefully rich filmmakers ever clamoring for higher taxes remember this in 2016.

John Tamny is editor of RealClearMarkets, Political Economy editor at Forbes, a Senior Fellow in Economics at Reason Foundation, and a senior economic adviser to Toreador Research and Trading ( He's the author of Who Needs the Fed?: What Taylor Swift, Uber and Robots Tell Us About Money, Credit, and Why We Should Abolish America's Central Bank (Encounter Books, 2016), along with Popular Economics: What the Rolling Stones, Downton Abbey, and LeBron James Can Teach You About Economics (Regnery, 2015). 

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