 The Social Economy of a Hollywood Strike, Part 2: What is at Stake! | Jan. 9th, 2008 @ 07:10 am  |
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[Note: Part 1 is Auteurs and Managers: Class Struggle, Blacklists, Business Models, and Film Theory - :The following post grew from responses to contributions at the must read weblog United Hollywood
. Alfredo Barrios's "The Strike Is a Lawyers' Game: How to Play to Win" is an explanation of the current negotiation situation between the WGA and AMPTP. BTL Guy's "Modest Proposal: Truce?" was a thoughtful proposal to get people back to work immediately and still let the WGA negotiate its own contract. The limits of "the lawyers' perspective" on the writers' strike (or any strike) and BTL Guy's union negotiation perspective inspired me to write a broad explanation for the "irrational intransigence" of the majors in the AMPTP. In order to understand what is going on in this strike it is necessary to realize that for the corporations there is more at stake than the economics of the entertainment industry or compensation of unionized workers. Personal Note: I am not a member of the WGA. I am not employed in the entertainment industry. I am pro-union and my politics should be obvious to anyone who reads my posts. Jerry Monaco]
The Social Economy of a Hollywood Strike, Part 2: What is at Stake!
What is at Stake for the WGA, for Hollywood, for the Labor Movement, for the Corporations, and for the Rest of Us in the WGA Strke or the Importance of the Writers' Strike:
The importance of the writers' strike to the multinational corporations can be summed up in a few sentences: The corporations that dominate the entertainment industry are fighting a battle for control of labor and creative products. In this battle they are the vanguard of a fight in which many other corporations also have a stake. All corporations in the so-called "post-industrial" economy look at the battle of the "The Hollywood Industry" as their battle. What makes this fight crucial for the owners and managers, is that what is on the line is not only the corporate interests of Viacom and Sony, but, to a large extent, Microsoft and Monsanto.
The implications of the WGA-AMPTP strike for the union movement in the United States deserves a longer explanation. It must take into account the changing economy in Hollywood and through-out the U.S. The significance of the writers' strike goes far beyond the workers in the entertainment industry. Sometimes I think the writers on strike and the workers in the industry do not themselves know the importance of this battle to the labor movement as a whole and to all creative people in our society. Unfortunately, my brothers and sisters in the union movement have also not recognized the full implications of this strike for the future of our movement.
First, of course, the writer's strike is important to the union movement in Southern California. It should be obvious to all people who know the history of the labor movement that the Southern California union movement often follows in the wake of the successes or failures of the Hollywood unions. This has been the case since the 1930s. At first, this was so, because the organization of the Hollywood unions was the big break for the union movement in an area of the country that was open shop, anti-union, and a locus for brutal union busting by the metropolitan authorities. Later, Hollywood workers' organizations were often a model for union success or for union failure in other industries. But one of the biggest reasons that Hollywood union success can spur on success in the Southern California region is because the Hollywood labor force includes among their members representatives from all important crafts in the economy as a whole -- carpenters, electricians, painters, designers and skilled workers of all sorts. Thus, for example, if painters organized a union with-in the studios in the 1930s this organization often spread to other painters in Southern California outside of the studios. If carpenters get a raise in the Hollywood unions this puts pressure on employers of carpenters through-out the region to raise wages.
What is not largely recognized, at least by those outside the industry (and unfortunately by many IATSE members), is that the writers' union has always been a wedge union in Hollywood. It was a target of the studio bosses in Hollywood's classical period, it was a major target of blacklisting in the '50s, and it has often been the union that the corporate bosses first took aim at when intending to undercut "below the line" unions. In the immediate post-war years below the line unions showed the potential to form an industry wide union. It was the SWG, among all of the creative unions, which was most supportive of below the line militancy, and paid the heaviest price for their support. In the vision of those days the IA progressives and the SWG were united in a perspective for an industrial union that would include the creative workers, from writers to painters. In this fight against an industrial wide union the bosses considered the SWG a major threat to the moguls' creative control. The leadership of the SWG was the most militant supporters of the striking carpenters and painters at the heart of the struggle.
It is important to know why the bosses have targeted the writers' union in the past, and are doing so now. Writers are at the heart of the central contradiction of the Hollywood system. Creative work is necessarily a free-flowing process that does not follow the rigid rules of business management. At the same time business management insists upon standardization and labor discipline. The prime motive of the business managers is profit and control. The prime motive of writers is often enough to create something that compels them. Writers, whose skills are not bounded by the specialties of screenwriting and television writing, are at the same time necessary to all forms of story-making of the movie and television industries. This often makes writers the weakest link in the business manager's plans. It is my contention that all members of the entertainment industry suffer from this same conflict between craft and creativity, on the one hand, and the effort of the owners and managers to impose labor discipline, on the other hand. For the managers and the owners of the Hollywood industries, the writers are at the heart of this conflict, and thus the writers' union has often been the main target of the Hollywood bosses.
The current situation in Hollywood has more than regional importance. It is important nationally, and, because of the companies involved, internationally. Unfortunately, the labor movement across the U.S. has not discovered the importance of this strike to their interests. To put it simply, many of the peculiarities of the "Hollywood" economic structure have become standard for the U.S. economy.
One example is the economic stratification of the star-system. Star-system economics often looks like a three-tier system -- the great stars at the top, followed by a lot of people hanging on to employment at the bottom, and below them the economically disenfranchised trying to grab on to the first rung of the ladder. This system of economics was basically modeled in the U.S. by Hollywood and transferred, from there, to the corporate sector. The real stars in today's economic system are the CEOs. All the rest who may think of themselves as stars, are mere celebrities, who, as far as the CEOs are concerned, are fit for Hollywood Squares, and can be traded like properties.
Another example of Hollywood peculiarities becoming the national economic standard relates to the problem of what is amusingly called "intellectual property." The very term "intellectual property" has to be questioned because rights to ownership of these intangibles are a result of a socially granted monopoly for a supposedly limited number of years. Intellectual property is "property" in the same way that corporations are "producers" of movies; in both cases what we are dealing with are legal fictions that are taken for reality. The fact is that Hollywood has led the charge for the constant expansion and lengthening of the idea of intellectual property. There are some aspects of the current WGA strike that can be called the "Sonny Bono Lockout." Because of Sonny Bono and Mickey Mouse, corporations now own the copyright to a work for 95 years. If a corporation "creates" a work "for hire" today the corporation will hold the copyright until 2113. Consider that there is not a human being on this earth that can predict which works created today will be valuable tomorrow or 25 years from now and certainly not 75 years from now. Further, no corporate prognosticator can predict what types of media will be the modes of transmission in 25 or 50- years. Again writers' who traditionally expected to own the copyright to their work are at the heart of this struggle. The wish of the current corporate moguls is to treat today's cohort of writers in the same way that the old blues artists were treated -- buy a bunch songs today for $20 and hope that tomorrow they will be worth something. In the meantime the "owners" take all the credit leaving nothing for the artist.
The important point is that in the emerging "intellectual property" regime this is the fate of all creators of work, whether they are computer programmers, comic book artists, or workers in the Hollywood industry. If the major corporations in the AMPTP are intransigent it is because they realize what they are fighting for, i.e. "properties" that will be their exclusive monopoly for almost a century. The fight over new media is not the fight over new media alone, it is in fact a fight for control and ownership of all new "properties." It is a fight that every single corporation involved in making "intellectual property" "for hire" has an interest in winning. The owners and bosses of these corporations believe that the creative work of others is their property alone, and any limits imposed on the fee simple of ownership is a "socialistic" encroachment on their property rights. This last point cannot be emphasized too much; the Hollywood model of the division between "creativity" and "ownership" has become the model for all sectors of the economy dominated by corporations.
Major coporations are scrutinizing this strike carefully and there is a high level of support for the intransigence of the AMPTP majors amng the corporate classes. Such support is not merely symbolic but a realization that the fight of the AMPTP multinationals is the fight of all corporations. The level of importance of this strike are parallel on both sides of the picket line. The AMPTP majors are fighting a battle that is important to all corporate owners and the WGA is fighting a battle that is important to all Hollywood unions, a battle that should be important to the whole of the labor movement. The difference is that the bosses of the multinational corporations seem to know what is at stake for them while the union movement has not realized the full importance of this strike.
Alfredo Barrios correctly tries to answer the question "why are the studios acting so insanely? Our demands are reasonable. Don't they understand that they have a lot to lose? Surely, it's the hardliners [at the WGA] who are holding things up, right?"
But the answer to this question, is not only a matter of negotiation strategy or even of simple economics, but rather of the overall interests of the corporations represented in this dispute. Legally, incorporated businesses are not supposed to consider the interests of the owners of corporations in general. Legally, they are only supposed to focus on the interest of their stockholders to the exclusion of all other stake-holders, such as employees or communities, etc. But legal obligations and practical policies often do not coincide. This is one reason why looking at a strike strictly from the point of view of legal negotiations severely limits both the importance of the strike to everyone involved and the strategy and tactics needed to win. In order to understand why these specific corporations are acting seemingly against their immediate economic interests it is necessary to understand what is at stake from their point of view.
Given the above discussion of the crucial division between the creators of "intellectual property" and the owners of that property it is necessary to bring up an impolite criticism of the Hollywood unions, and especially of the "creative unions." The very divide between "creative unions" and "below the line" unions is artificial. Most of the workers in Hollywood are "creative" in one way or another and deserve to be considered so. They also deserve "creative" ownership of the collective work of movies and television shows, etc. This notion of creative ownership needs to go beyond the simple funneling of residuals into the health and pension funds of below the line workers. Such a battle for the expansion of creative ownership to "below the line" workers cannot be won with this strike but all of the "creative" unions should take up this fight. As a practical matter it is necessary to unite all Hollywood unions in order to deal with the massive multinational corporations who own the entertainment industry. The rank and file of IATSE and other below the line unions must be won over to the fights of the creative unions, and vice-versa, or else any gains in this battle will always be under threat. Ultimately, the aim should be to create an industry wide union containing everyone from the great stars to the maintenance workers. The so-called "creative" unions must take some of the first steps to spread the idea that creative ownership is shared by all who work on a movie or show.
I come to the conclusion about the artificiality of the divide between creative and below the line workers after studying the history of set designers and their attempts to unionize in the old Congress of Studio Unions. When the set designers were most powerful in their union -- roughly during the period of World War II -- they asserted real creative influence over the movies they were involved in and could be considered one part of a "collective of authors." (I have written about these subjects at length at my weblog. In short the "auteur theory" is mostly a description of the result of an historical struggle which acknowledged the "managerial" cult of the director-as-unit-foreman instead of investigating how collective authorship could be credited to all creative workers.) In other words, if copyright exists in creative works produced by the entertainment industry, then all workers should share in the continuing benefits of those copyrights during the whole life and in all the uses of that copyright.
But all of that is only a perspective for the future.
So let us be clear, the fight here is not merely about compensation it is about control. Recently, while reading about the history of Hollywood unions I came across the following quote, about why the moguls have always been adamantly opposed to any union for writers.
The blood-letting between studio management and the SWG, which endured for nine years, showed where the real conflict in Hollywood lay, not over money, but over the control of moviemaking. The producers willingly paid gargantuan salaries to the best actors, directors, and screenwriters, but steadfastly resisted any encroachment on creative decision-making. (The Inquisition in Hollywood: Politics in the Film Community, 1930-60, Larry Ceplair and Steven Englund)
The (non)negotiating strategy of Counter and Company, is not merely a result of a lawyer's "over-promising" to his clients; it is also a result of twenty years of change in The Industry.
One aspect of that change is the integration of all entertainment industries into the multinational corporate system. This is where the anomalies of Hollywood business practices have come into conflict with corporate standards. In other areas Hollywood has acted as a model of how to obtain control of the products of creative workers. But in the area of how deals are made Hollywood is a model of anarchy, at least from the point of view of the multinational CEO.
Consider the following: What happened to Las Vegas in the 1980s also happened to the entertainment industry in the same time period. The pre-1930s way to finance movies was to go to a bank to structure loans. The banks financed a bet on the future year of movie releases. Studios made movies in the same way that farmers grew crops. In the 1930s, when banking money dried up, the casino owners view of financing took over and much of the liquid financing came from "underground" investments from essentially tax-avoidance and money washing operations. (A little known aspect of depression era studio financing is how much of it came from the underground economy, especially bootleggers and gamblers.) But in the same ways that multinational corporations bought out the gangsters in Las Vegas, the multinationals bought out the deal-makers in Hollywood. The big executives at the multinationals might have understood the old studio-system business model, because essentially the studio system was a "Fordism" model, where the factory was based in Los Angeles and the business operations in New York. But to the CEO of General Electric the current Hollywood "deal making model" must look as if he were putting a number of free-wheeling middle managers in charge of mergers and acquisitions of 250 million dollar factory units. Further more these factory units are run by mad men and women - creative types and bohemian wannabes. And the crowning absurdity is that each factory unit is as temporary as a nightclub pick-up band, gathering employees and equipment and sets for eight months or five years and then breaking them down again. It must look to these new bosses as if a traveling three-ring circus has been hired by General Motors to assemble their cars on a year-to-year basis. It just doesn't make sense to them. In the long run their intention is to find a way to rationalize the political economy of deal making. And in this attempt at rationalization the Hollywood unions stand directly in the way.
So another aspect of the intransigence of the bosses in this fight is a long-term institutional conflict between the corporate owner-financiers and the way creative teams are assembled to do anything in the entertainment industry. In many aspects the formation of creative teams for the making of high-priced collective entertainment has not changed since Shakespeare's day. Making a movie or putting on a show is a matter of picking up an ensemble, from here and there, mostly through social networking. The project of this ensemble is based on the more or less intangible "narrative" of a creative individual or a team, often a writer or writers. None of this is "rational" from the point of view of the corporate bottom line.
In the old entertainment industry the "investors," the money-men, were always "external" to those who ended up "owning" the movies. One result of the finalization of corporate dominance in the '80s and '90s has been that the owners and the investors in the entertainment industry are now a part of the same business conglomerates. (In Roald Coase's terms investment functions have been "internalized.") This internalization of investment has brought out in fine relief the divide between the owners and the collective creators of entertainment.
Much of the history of Hollywood can be written as a tug-of-war between the creators and owners of the works of entertainment. But when the investors were external to the companies to the companies who owned the movie studios, and the companies presented themselves to the investors as borrowers for the next year's crop of movies, the investors did not have to concern themselves with the "irrationality" of creativity. "That is just the way they do things in those industries," the investors could say. The owners, and deal-makers, could themselves take a patronizing attitude to the creative types they gathered under the tent. But now that the owners, investors, and often enough, the sponsors, are all a part of the same interconnected companies, this kind of irrationality is unacceptable. And again, the great roadblock to rationalizing this system is the old craft and trade unions.
Barrios states correctly: "CEOs hate uncertainty. They run their businesses based on long-range plans that are based on long-range assumptions." But he fails to see all of the long range plans of the big conglomerates. The moguls are not only willing to inflict economic pain on the workers in their industry, especially the below the line workers, but they believe that this pain is necessary to enforce labor discipline. General Electric, Sony, Viacom, Rupert Murdoch's NewsCorp, have a perspective that goes far beyond this strike. Their perspective is that they wish to do to the WGA what Reagan did to PATCO, because the WGA must be held up as an example to all unions. Their perspective is that if they let the writers win here they will be opening the door to similar victories beyond the entertainment industry. Their perspective is that they can afford to lose a few billion dollars in order to stop the writers from earning a few pennies because more than short-term profits in this small industry are at stake. Their perspective is that they must enforce their new "rights" to all forms of intellectual "property" and that to give into workers here would be to allow a trespass on these new forms of "property". Their perspective is not limited to the entertainment industry; it is not only national it is also international. They believe that if they let creative artists and workers have a piece of the action here, then workers in other sectors of the economy, and in other places in the world, will also be looking for their share of these new forms of "property" that they have invented. Barrios fails to see that among the long range goals of the current CEOs in charge of the multinationals is maintaining control of the creative process itself. From the point of view of people such as Murdoch or Iger, the creative types inside the old "entrenched" unions are like the skilled workers who resisted industrialization. If the economic process is to be rationalized the creative types must be brought in line. For the Murdochs of the world, the long-term battle is to find a way to force these meddlesome unions to give up on any idea that people may actually own the works they create. The CEOs look at themselves as the masters of the universe, and the WGA especially threatens that mastery.
[In my next post, I will attempt to show a perspective that can win this strike. It is important to be optimistic in our everyday actions but also to be realistic about the strength between the parties in conflict. I will sketch out how the above perspective of what is at stake leads to more than negotiating strategy for winning this strike.]
Jerry Monaco
9 January 2008
New York City
[Caveat: I am not a member of the WGA, nor do I speak for any of the officers or members of that union or any other union. I have been a member of other unions in the past and I am a supporter of a stronger union movement in the United States. J.M.]
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