I think he might have been joking about paying essential bills. In the US, the mean entertainment budget is a few thousand dollars a year. Perhaps it's several thousand dollars a year for people who would even consider spending $200 at a theater. That's still only around $500/mo for entertainment to allocate, and so even though a family in that situation poor, they still are incentivized to spend the money so they can be entertained as often as they'd like to be throughout the month. Spending a third of the money in one night is probably an easy yes as a one-time event, but harder to justify regularly.

It's more of a comparison between costs and benefits. If you have to literally choose between taking the family to the movies or paying the power bill, that's not exactly a tough question.

Going to a 2-hour movie at the cost of $80-100 or more is quite the splurge.