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The article cites movies like Top Gun 2 that were never made because they were so heavily reliant on military cooperation and had "politically controversial aspects of the scripts".Let’s be clear - the Pentagon and other government organizations can’t actually prevent a movie from being made. They can only prevent a movie from being made with their cooperation.
So it does seem they do have the power to scrub a production, as well as the will to do so.The CIA even sabotaged a planned series of documentaries about their predecessor, the OSS, by having assets at CBS develop a rival production to muscle the smaller studio out of the market. Once this was achieved, the Agency pulled the plug on the CBS series too, ensuring that the activities of the OSS remained safe from public scrutiny.
Thanks for the article link, MeMeMe.