The academy of dreams

On Sunday night, the Oscars will celebrate 75 years of myth-making and stargazing. And, despite the drama being played out on the world's wider stage, David Thomson predicts that the awards will have as tight a hold on America's imagination as ever

If you are of a cynical turn of mind – and that may be the last measure of mind left – you could propose "Oscar" as the man of the 20th century. I know, "he" is only 13.5in tall and 8lb in weight (90 per cent tin, 10 per cent antimony, with layers of lacquer, the last two being 24-carat gold and an epoxy sealer – recipients need only dust the old boy; solvents are not good for him). Yes, he lacks the voice of Hitler or Churchill. So, is it silence that will command a worldwide television audience of over a billion on Sunday?

Yes, he's small and quiet, but is there a better-known emblem of achievement in the most demented meritocracy in the world? As for his pose, his attitude, his ideology – surely their ambiguity serves all purposes? He is, if you like, a knight, abstract Arthurian, if robotic, as plausible a god in some antique religion or a fascist future, clasping a sword that pins a reel of film to the ground (interpret how you will!). Yes, there is something odd about his head, but in 1927, the screenwriter, Frances Marion (a scourge of folly ahead of her time), knew how to interpret that: "I saw it as a perfect symbol of the picture business: a powerful athletic body clutching a gleaming sword with half of his head, that part which held his brains, completely sliced off."

A case could be made for ending this piece right there: Marion's estimate is untoppable and still accurate – especially if there are attacks on Iraq during the ceremony, and the Oscars still get bigger TV ratings than the war. But there's more to be said, and it's a history that began 75 years ago.

Consider Louis B Mayer, the West Coast head of Metro-Goldwyn-Mayer, an enterprise only two years old in the summer of 1926, but promising to dominate the movie business. Mayer was a brutal upstart, from the savage Russias of pogrom, prejudice and famine, a man who had sought to suppress his own dark nature by the simple, sweet spin of claiming that he was born on the Fourth of July. In fact, he was uncertain when or where he was born. All he knew and needed to cling on to is that, once an indigent refugee, once a scrap merchant in Canada, once a movie-theatre owner in New England, he had become one of the highest-paid men in America, fronting a business that has no equal in rapid expansion.

In the years just before sound, the movies had 65 million admissions a week from a population of about 120 million (two thirds of children went once or twice a week). "Everyone" went to the movies, and Mayer wanted to keep it that way.

He was already rich, and ready for more, when, in 1926, he decided to build a beach house for his family at Santa Monica. His studio had under contract a small army of construction crews – the people who build the sets for movies. Mayer reckoned to hire that same labour to build his house, but it was only then that he learnt a grim fact. Studio construction people were paid a good deal more than their equivalents on the open market. Why? Because their unions negotiated better terms. So, Mayer hired cheap Mexican labour (an LA tradition), and began to brood on the peril of unionisation.

Remarkably, film-making had been only minimally penetrated by labour unions in 1926 – construction people were unionised, but not directors, actors and all those people who earned more money. What will happen if they ever get that idea, thought Mayer. So he planned to forestall organised labour with a kind of all-purpose league of those involved in picture-making, to be led, devised and controlled by the producers (by people such as Mayer). He decided to call it the Academy of Motion Picture Arts and Sciences – which sounds so much more distinguished than "the Movie Gang".

There was another impulse behind the "Academy" that had everything to do with respectability. The astonishing onset of the movies was just one dynamic coursing through US society. Another was reaction to the Russian Revolution in a country supposedly founded on equal opportunities for all. Another was the enfranchisement of women. Yet another was the continued denial of black rights, already clear under law but not yet in practice. All of this in a country that was having to put the test of an essentially New England constitution to the actual experience of a horde of immigrants. The US might be set on a course towards amazing prosperity and virtual empire. But parts of the "establishment" felt threatened by the instability.

The rise of Hollywood has to be seen in those terms, for it offered a form of entertainment and an ideology with special appeal to all the newcomers. The silent film (a gift to those whose English was poor) threatened all those institutions that treasured language – Academe, the law, politics. New wealth might make a mockery of America's class system. And the ease of California life was, and remains, an affront to Eastern Seaboard thinking and its reliance on winter, hardship, crowded cities.

It was a common complaint in the early Twenties that the US population was being led astray – from such puritan ethics as a sound education, hard work and tough practical thinking – by a culture that encouraged sensationalism, the good-looking, and the delirious fantasia of happy endings. For the Jews who held such power in Hollywood (in a country full of anti-Semitism), there was good reason to want to keep quiet about the vast movie salaries, the foolishness of much Hollywood life, and the several scandals that rocked the industry at that time. From the Fatty Arbuckle case to the murder of William Desmond Taylor, there had been too many lurid stories of drugs, booze, and sexual abandon coming out of Hollywood. (And since Hollywood's secondary industry was publicity, it was hard to stifle these stories.) Mayer, a devout hypocrite, was a leader in the urge to spread the message of reform. The talk of Arts and Sciences was to distract people from scandal.

So, it is not mere facetiousness that offers "Oscar" as man of the century. This faceless sentry had helped transport its America from a land of reality to one of fantasy, living legend and pure spin. How did it come to be called Oscar? Take your pick. Margaret Herrick, the first librarian of the Academy, thought that the statuette resembled her Uncle Oscar. The columnist Sidney Skolsky said that he came up with the name. And when Bette Davis got her first award, for Dangerous in 1935, its flat bottom reminded her of her then husband, whose middle name was "Oscar".

Davis deserves a place in the story. In the early Thirties, the Academy was at war with the new unions that represented actors, directors and writers. It was also, by then, a business in crisis, in which Mayer had called for large salary cuts and where the box office was in decline – not just because people couldn't afford the ticket, but because many "Americans" couldn't follow talking pictures. So the Actors Guild forced most of its members to withdraw from the Academy. Thus, the Academy's diminished membership failed even to nominate Bette Davis for Of Human Bondage in 1934. There was an uproar. The Academy relented and agreed that her name could be "written in" on ballots – still, she lost, to Claudette Colbert in It Happened One Night. But it was as a gesture to the Screen Actors Guild that the Academy introduced supporting- actor awards (first given in 1936) to boost their membership.

Of course, it has all worked out – there are not many clearer proofs of how effectively PR in America can alter the public's sense of reality. The vast audience shows how much Oscar matters. We know it's a fatuous game, but we care who wins. We watch because we have swallowed the notion that the movies are central to our lives. In fact, the American appetite for going to the movies has shrunk horribly since those halcyon days of 1926-8. Many people have given up the habit, reaching the conclusion that movies are no longer made for them. Yet the Oscar show – and the amount of advertising money spent on it – grows larger every year. And many Americans – certainly their presidents – believe that they are actually in unending movies.

The awards night was once a banquet, at which the guests had dinner at the Roosevelt Hotel, before the winners were announced. Now, it is a ponderous theatrical event, subject first to radio, and then to television, and by now, far and away the Academy's largest source of income in a year – and thus the means of support for a wonderful research library.

Over the decades, the occasion has delivered the goods; the way Frank Capra's It Happened One Night swept the board in 1934; 1939 turning into a benefit for David O Selznick and Gone With the Wind; the many awards that went to From Here to Eternity in 1953, a novel that people had reckoned was too tough to be made; the triumph in 1972 and 1974 of the first two parts of The Godfather; and so on.

On the other hand, it's easy to find 10 Best Pictures that no one should have to see again – The Life of Emile Zola (1937); Mrs Miniver (1942); Going My Way (1944); Gentleman's Agreement (1947); The Greatest Show on Earth (1952 – among the outstandingly mistitled works of all time); Around the World in 80 Days (1956); West Side Story (1961); My Fair Lady (1964); Patton (1970); Rocky (1976) – that's nine, how about Chicago (2003) as the topper?

I know, it's all opinion, and I've probably trodden on your toes a few times already in that scurrilous list. Perhaps it's more instructive, and less offensive, to offer a list of 10 great American films that were never even nominated for Best Picture: The Shop Around the Corner; Rear Window; His Girl Friday; Red River; Psycho; In a Lonely Place; The Night of the Hunter; Blue Velvet or Badlands. A long time ago now, the Academy got into the habit of bestowing "honorary" awards on people that they managed to miss – like Howard Hawks, Cary Grant, Alfred Hitchcock, and, this year, Peter O'Toole. But there's no kind of action on behalf of the particular films. And so, in America, it's hard to see the remarkable and scary The Stunt Man, nominated in 1980 for both O'Toole and its director, Richard Rush, but defeated.

The Stunt Man is that rare thing, a film about Hollywood and movie-making that actually leaves you wondering about the validity of those things. And just as Mayer intended, the Academy likes pictures that like them, and that approve of the job that they are trying to do. If Chicago does win this year, it will be one more confirmation of the cockamamie spirit of show business carrying all before it – including the allegedly "adult" notion of killers being turned into popular heroines.

In a "free" society such as the United States, there's no need for the government to control the process or censor the show. The collusion with positive thinking and "America first" attitudes is so complete. Yet this year, the system faces a great test – a reason even for watching the show. It is probable that the live coverage from Los Angeles will be interrupted by reports of bombardment. It is to be hoped that some people given their shot at free speech may even address the larger realities elsewhere. Several high-profile British nominees have already declared their intentions: Stephen Daldry, the director of The Hours, has vowed to denounce the war from the podium if he wins. David Hare, nominated for his screenplay of the same film, has already publicly condemned any invasion of Iraq; and Daniel Day-Lewis, favourite to win Best Actor, has called for the ceremony to be toned down. "It would be obscene if we were there, flouncing up the red carpet ... and people were dying somewhere in the world," he said.

Steve Martin – this year's host – has an uncommon burden. Apart from being the "wild and crazy guy" that we love, Martin has earnestly fought for a very different reputation: art collector, playwright, novelist – an intelligent, rounded American? As well as a famous satirist. Will he, therefore, offer any "humour" on those other theatres where "USA" is playing? No one at the Academy admits to "instructing" Martin in what to say, or improvise. At the same time, the people who run the show promise to drown you out in orchestra, and to cut away, if you go on past 45 seconds. Will most prizewinners have the trained industry wisdom to shut up? Do they honestly believe that you can't and shouldn't try to confuse "art" with "politics"? Assuming that you know what "art" is. If so, the orthodoxy can persist that thinking well of yourself is America's greatest gift to the world. And so positivism eclipses criticism, and cheerfulness overrides education. If you're stupid, you need to be optimistic – or to know that God is on your side.

There's one unruly soul expected at this year's show – Michael Moore, who is nominated in the documentary category for Bowling for Columbine. That is one of the few films to be named on Sunday night made with any awareness of the particular circumstances of the early 21st century. But here's a fascinating point. Moore's Bowling for Columbine is not nominated in the best original screenplay category – for which it won, 11 days ago, in the Writers Guild of America vote.

That seems contradictory: for isn't it the writers branch of the Academy that nominates screenplay contenders? But then you have to count the numbers and recognise anew the difference between the Academy and a Guild. The Academy, in all its branches, has fewer than 6,000 members. The writers' branch does not include 1,000 members. But the Writers Guild is many thousand strong.

In other words, the writers who belong to the Academy are the successful, the well- paid, the elderly, the retired. Whereas in the Writers Guild, there will also be numbered the far less successful, the younger people, those who might still be hostile to the system. It was those writers who helped reach the result that Bowling for Columbine was the best original screenplay of 2002. It was certainly the most provocative – but the Academy has preferred to overlook it (like Charlton Heston tottering away from Moore's nagging questions in the film).

The Academy could find wretched luck this year: there might be a need to cut away from this or that inept starlet to reports of a gas attack in Iraq. On such a cut, who could ignore the surreal isolation of the Academy and what it wants to believe in? Yet even without that horror, with just the regular assignment of a hundred or so "Oscars", can't we see that American movies are just as far removed from what America was created for?

Live coverage of the Oscars on BBC1 begins at 12.50am on Monday morning