Sodom and Gomorrah : the story of Hollywood (1935)

210 SODOM AND GOMORRAH it to the extent of bankruptcy. Other causes beside the abnormal times are responsible for the empty coffers of Hollywood. In the first place, during the prosperous years the film companies should have accumulated considerably larger reserve funds. Considering the small dividends they paid even in the most prosperous times, the motion picture corporations should have piled up enormous surpluses. This would have enabled them, with any kind of management at all, to have slipped through the depression with the least trouble of any major industry, for the films were making huge profits in 1930 and continued to operate in the black as late as 1931. It was not until 1932 that the Warner Brothers, among others, began to reckon their losses in the dozens of millions and found themselves coping with real adversity. But, like the well-known grass-hopper, while summer was here they lived high, wide, and handsome, without making provision for even the most temporary set-back, let alone real trouble. When the inflation bubble burst, then, it is no wonder that the motion picture industry crashed into bankruptcy with a momentum that is still dazing the ruined stockholders. Motion pictures, like newspapers, are a habit, and as such their patronage is not decimated by hard times like the sales in many other lines of product. People will be amused, and they will