The Spastic California Tango: Newsom Courts Paramount with Tax Breaks While Bonta Nukes Negotiations

The ongoing antitrust saga pitting California Attorney General Rob Bonta against Paramount’s proposed acquisition of Warner Bros. Discovery has devolved into a classic cat-and-mouse game—except the cat keeps tripping over its own tail, and the mouse is seriously considering packing up the studio lots and bolting for friendlier pastures.

Last week, reports noted the state’s latest attempt to court Paramount amid threats of an exit: expanded film and television tax credits, with Paramount projects snagging more than $37 million in the latest round for productions like the Viola Davis thriller Ascent and a Clueless sequel series. These incentives are part of Governor Gavin Newsom’s broader push to prop up Hollywood after years of over-taxation, over-regulation, and an exodus of productions to lower-cost states. The message was clear enough: please stay in the Golden State we’ve made so expensive and difficult to operate in. We’ll throw some taxpayer-funded carrots your way.

Newsom himself has been publicly signaling flexibility on the lawsuit. At a San Francisco press conference, the governor said he would prefer a settlement “if it’s a good deal.” “That has to be worked through, and that’s a process that’s unfolding,” Newsom added. “I’m concerned about the state, our reputation.” On Paramount’s threat to leave California, he took it “seriously”: “I hope that doesn’t happen, and I’m of the belief that they don’t want to see that happen… I want to see Hollywood thrive.” Even he appears to recognize that losing a media behemoth would deal another blow to an economy his administration has spent years crippling with high taxes, energy costs, and regulatory thickets.

Enter Attorney General Rob Bonta, who just slammed the brakes. On the eve of a scheduled Monday meeting with Paramount executives to discuss potential settlement terms, Bonta canceled it cold. He accused the company of leaking “the alleged substance of settlement discussions” from a Friday prep session and misrepresenting them, thereby “demonstrating a lack of good faith.”

“As soon as Paramount stops playing games and engages sincerely, my office is happy to meet again,” Bonta declared. Two steps forward, one giant leap backward, like some spastic Californian tango performed by politicians who can’t decide whether they want the jobs and revenue or the progressive antitrust trophy.

Paramount has flatly denied the leak allegations, stating it was not the source of any confidential discussions with the AG’s office and remains ready for good-faith talks. With no public evidence pinning the disclosure on the company, and the details having appeared in major outlets after the Friday meeting, it is equally plausible that the leak originated from somewhere inside the California government itself. Leaks are a bipartisan sport in Sacramento, after all, especially when they serve a political purpose.

This is the same state that lectures corporations about “equity” and “competition” while simultaneously offering selective tax breaks to keep them from fleeing the consequences of its own policies. Newsom frets about California’s reputation and Hollywood’s future; Bonta prioritizes the litigation theater and the narrative of standing up to “Big Media.” The result is prolonged uncertainty for workers, productions, and the state’s already fragile entertainment sector.

If the goal were truly protecting consumers and competition, the parties could negotiate structural remedies without the melodrama. Instead, Californians get another round of self-inflicted economic damage dressed up as principle. Paramount may yet decide the dance isn’t worth it. And who could blame them?