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Blue Velvet producer Fred Caruso remembers showing up on set one day to find David Lynch sorting through Polaroids he had recently taken with his son. Caruso asked to see them, expecting to view innocent family snapshots, so was startled to find images of a dissected chicken reassembled into cubist sculptures. The director later explained it was fun and a little scary to look at routine things in new ways.

As it turned out, the other pictorial Lynch shot that summer in Wilmington, N.C., would be his most celebrated foray into spooky everyday surrealism. For Blue Velvet, which will be screened in a newly restored, 20th-anniversary print at Cinematheque Ontario tonight, tomorrow and Monday, turned out to be the definitive Hollywood film of the eighties -- a trick valentine to Ronald Reagan's America complete with a white picket fence stapled across its heart.

The 1986 film begins in the spirit of America's master cheerleader, conjuring comforting images of an untroubled past. Viewers are at first greeted with a cloudless blue sky, followed by red roses swaying against a white fence, a passing truck of waving firefighters, and a kindly crossing guard helping toddlers traverse an otherwise empty suburban street. All the while, Bobby Vinton lends his creamy tenor to the innocent, 1963 pop ditty Blue Velvet.

This cheery montage sets us up for what comes next: a man watering his grass collapses after suffering a stroke. Lynch, who first astonished audiences with expressionist flourishes in his experimental debut, Eraserhead (1977), then pulls us into the very fabric of the lawn, wading through spears of grass that are suddenly big as trees. Soon, a mechanical wail fills the soundtrack as an army of ants feast upon an unseen victim.

The film will repeat this "innocence overwhelmed" motif for two hours. The man's son, Jeffrey (Kyle MacLachlan), is out in the nearby woods, being serenaded by Lumberton AM radio ("at the sound of the falling tree, it's 9:30"), when he reaches down and finds a severed, ant-covered human ear. He brings his discovery to the town detective, later falling into an easy conversation with the policeman's daughter Sandy (Laura Dern) on the way home; a scene meant to remind us of Jimmy Stewart and Donna Reed's sweetheart stroll in It's a Wonderful Life. Except in Blue Velvet, Jeffrey and Sandy turn out to be Hardy Boys detectives who stumble into a nightmare world of rape, murder and revenge.

Blue Velvet was a story that Lynch knew by heart, having played with the screenplay for more than a decade, often working on the script at a Bob's Big Boy in Hollywood, where he lunched daily for four straight years (1973-77), ordering a chocolate milkshake every meal. The former Eagle Scout wanted to depict the small-town America he encountered travelling with his forest scientist father through the Pacific Northwest in the 1950s. (The filmmaker would create a second variation of Lumberton with his squirrelly, 1990-91 TV cult hit, Twin Peaks.)

Lynch wrote many drafts of Blue Velvet, but the crime story continued to revolve around two set pieces. As a boy, Lynch and his brother once encountered a naked woman wandering the street, a startling apparition that caused them to break into tears with the knowledge something had gone terribly wrong. Lynch felt compelled to replicate that childhood moment on film. He also kept returning to a sequence where a young man stole into a woman's room at night, happening upon a horrible crime that became his own.

Indeed, in the movie, Jeffrey watches sadistic admirer Frank (Dennis Hopper) brutalize Dorothy, an off-duty singer (Isabella Rossellini) through closet blinds. After he leaves, Dorothy invites the young man to beat her as well. Later, Hopper's character confronts Jeffrey, laughing, "You're me!"

The director's most provocative assertion in Blue Velvet is that Jeffrey and Frank are partners of the same America. Reagan's "shining city upon a hill" isn't a fabrication so much as a half-truth, the filmmaker seems to be saying. A former painter and musician, Lynch offers up this theme with a potent array of visual and aural atmospherics, along with cheerfully banal dialogue that somehow makes the film's dreamworks all the more intoxicating.

Lynch would continue to reveal America in a dangerously cracked funhouse mirror in such films as Wild at Heart and Lost Highway, but would only come close to achieving the power and poetry of his 1986 masterwork in his bewildering Hollywood mystery Mulholland Drive. Comparing Blue Velvet to Citizen Kane, critic David Thomson wondered whether there was something in the air in the mid-1980s that prompted the surrealist filmmaker to drift, for 120 thrilling minutes, into perfect clarity.

"I'm seeing something that was always hidden," Jeffrey's character says early in the film, walking down the street with Sandy, staring into the American night. "I'm involved in a mystery. It's all hidden." It may as well be Lynch speaking.

Cinematheque Ontario screens Blue Velvet today, tomorrow and Monday at 6:30 p.m. at AGO Jackman Hall, 317 Dundas St. W. For information call 416-968-3456 or visit http://www.bell.ca/cinematheque.

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