Hollywood can't come to terms with its writers, and Best Auto Painting in Sun Valley is paying the price.
That's because owner Jeff Rassouli hasn't been getting the usual referrals from nearby Studio Picture Vehicles, a rental service where 175 car drivers are out of work and business is down 68%, largely because of a 10-week-old strike by the Writers Guild.
"It started a couple weeks ago. We were affected pretty badly," said Rassouli, who figures the strike is costing him $400 a day.
Rassouli isn't the only one bleeding as a result of the entertainment industry's latest labor strife.
War of Attrition
Like Iran and Iraq, Hollywood producers and their writers have become mired in a grinding war of attrition, which began after their triennial contract talks collapsed March 6.
If history is any indication, no one is likely to emerge a clear winner. Writers strikes in 1960, 1973, 1981 and 1985 generally ended with compromises that left both sides less than completely satisfied.
But mounting casualties--perhaps worse than either writers or producers anticipated--are already straining the guild, damaging network schedules, emptying studio lots and hurting thousands of people in other businesses, many of whom, like Rassouli, are not directly allied with any of the combatants.
The California Film Commission estimates that the movie and television industry contributes $6.5 billion a year to the California economy. It employs, directly and indirectly, about 230,000 people, most of them in the Los Angeles area.
The strike's impact on that sizable industry was initially muted because many TV shows were closing for a seasonal "hiatus," and dozens of movie scripts had already been written for films that will be shot this summer.
But damage is rising fast as the walkout enters its third month, bringing work on future movies and TV shows to a near halt:
- Agents are going without commissions, studio suppliers are laying off employees and tables are suddenly available in some popular Hollywood hangouts. "Art's Deli is half full. At Hampton's, you can get a table anytime you want," Alvin Rush, chairman of MCA's television group, said last week of two popular studio hangouts.
Slow and Tiresome
At Movieland Caterers, where billings normally run $225,000 a month, owner Allan Stearns said business fell to $55,000 in April as "Cheers," "Brothers" and other TV shows were shut down by the strike.
"This is getting kind of tiresome," Stearns said of repeated labor problems in the entertainment industry. This time around, he's already laid off 30 employees and maintains that his business is jeopardized by heavy monthly truck and rent payments.
- Among writers, big earners appear to have been hit first. According to the companies, about 350 highly paid television writer-producers were suspended by their studios from lucrative development deals that can pay even the lesser lights $5,000 a week. (Yet a few of the top writer-producers--for instance, Ed Zwick and Marshall Herskovitz of "thirtysomething"--say they are still receiving payments because they are producing a pilot show from a completed script.)
Some top earners, believing that they have little to gain from a strike, are privately exploring strategies for ending the walkout. A few have discussed eventual secession from the guild or a restructuring under which highly paid writers would have more voting power than members who don't work.
- At the networks, profits might actually rise in the short term. Duff & Phelps TV analyst John Goss says the lower ratings and advertising rates that might accompany a season of reruns could be offset by lower programming costs. CBS has postponed its fall season premiere to late October from Sept. 5, and the other two networks say they may delay theirs until late November if production does not resume by July.
Others warn that the already weakened networks might permanently lose market share as more viewers sample cable TV and videocassettes. "The ultimate concern is that people will collectively say 'to heck with the networks,' " said John S. Reidy, an analyst with the investment firm Drexel Burnham Lambert.
- With virtually all work on fall TV shows suspended, big studios and small production companies alike are laying off hundreds of clerical employees and making few plans to call back an estimated 20,000 actors and production crew members who would normally begin reporting to work in June.
Bernie Brillstein, chairman of Lorimar-Telepictures' movie unit, denied rumors that the big independent studio was about to close the commissary on its Culver City lot. But companies as financially strong as MCA's Universal Studios have slashed expenses by reducing payments for the support staff of movie and TV producers on their lots. "No one is in, due to the writers strike," says the answering machine at TV producer Bill Sackheim's office at Universal.
Fixing the Blame
Predictably, Writers Guild leaders and company negotiators blame each other for the rising toll.
"Management has never ceded us anything without a fight. When we've asked for even a modest increase (in pay and benefits), we've had to strike for it," said George Kirgo, 62-year-old movie and TV writer, who has been president of the guild since 1987.
"We have to hold the line with writers because next we have the (craft union negotiations), and next year we have the actors," said J. Nicholas Counter III, head negotiator for the Alliance of Motion Picture and Television Producers, which represents about 200 production companies.
Even as the writers picket, the producers alliance is in contract talks with about 30,000 transportation and craft workers represented by the Teamsters and the International Alliance of Theatrical Stage Employes, whose agreements expire July 31.
Core issues in the writers dispute are producers' demands for a radical change in the way residuals for one-hour TV shows are paid to writers, and writers' demands for sharply higher residual payments from burgeoning foreign TV sales. Producers have claimed that all writers together would receive about a $50-million pay increase under the companies' final contract offer, while writers have claimed the package would cost them $35 million, after adjusting for inflation.
Balance of Pain
The impasse is likely to be broken only when the balance of pain tilts against one or another of the adversaries.
Union leaders originally believed that the networks, which have steadily lost market share to cable and cassettes, would quickly pressure big program suppliers into settling rather than risk damage to the broadcasters.
But some studio negotiators privately have said that three cost-conscious network chiefs--CBS President Laurence A. Tisch, NBC President Robert C. Wright and Capital Cities/ABC Chairman Thomas S. Murphy--assured producers early in the strike that they were willing to endure a prolonged walkout in order to cut programming costs, which total roughly $1 billion a year for each network.
The networks lost 22 episodes of such prime-time series as ABC's "Moonlighting" and NBC's "Cheers" at the end of the season because of the strike. And some proposed shows--for instance, "Heartland," a possible CBS series that was being developed by Witt-Thomas-Harris Productions--may never get off the ground because producers could not complete pilot programs this spring.
But the networks are in a relatively favorable position this summer and fall, since their schedules are heavy with special events, including the Olympics, the World Series and the presidential campaign. Moreover, some entertainment programs, notably the daily soap operas, have held up surprisingly well thanks to non-union writers, including secretaries, producers and others.
"I would like to (be able to) say that (the scripts) have been absolutely awful. But they're not terrible; it's just terrible that they're being written by non-guild people," said Ann Marcus, head writer for ABC's "General Hospital."
Like the networks, some studios could reap a short-term cash bonanza from the strike, since their TV units are not spending money to make episodes that normally don't return a profit until (and if) they are sold as reruns to TV stations years after their original network showings. Presumably, however, forgone episodes will result in reduced income to the companies over the next several years.
As for movies, studios claim they have enough completed scripts to fill their distribution pipelines until next summer. "Despite the strike, we will be commencing nine movies with the possibility of a tenth within the next four months," said Thomas Pollock, chairman of MCA's Motion Picture Group, which includes Universal.
Impact on Films
But some individual films have been hurt severely. "Annie II," which was to have been distributed this Christmas by Tri-Star, has been postponed because of script problems, according to co-producer Rastar Productions. "Blue Lightning," an MGM film that was to have been produced by Zanuck/Brown Co., has been similarly delayed, costing about 200 jobs this summer, an MGM executive said.
With the damage mounting, many guild members say they are prepared to stay out for many more months rather than bow to the companies. "We stayed out for six months in 1960. If we have to stay out six months this time, I guess we will," said 78-year-old Julius Epstein, a longtime guild activist who co-wrote "Casablanca" and suspended work on a planned Tri-Star film when the strike began. (The 1960 strike actually lasted from Jan. 15 until June 15.)
But other writers say the guild is wreaking more damage on its members than on anyone else.
"It's been proved that the studios will withstand a strike and are in a better state to sustain it than the guild. . . . The Writers Guild, more than any other union, has a kind of lemmings-charging-toward-the-sea mentality," said Rob Cohen, a guild member who also directs and produces films with director John Badham.
Signs of Dissent
While the guild has appeared unified on picket lines and at membership meetings, some working writers agree with Cohen.
In interviews last week, a dozen writers--most of whom insisted on anonymity for fear of union reprimands or fines--spoke vividly of the strike's damage to their pocketbooks and careers and, in several cases, of severe doubts about the guild's stance. ("People are free to say whatever they want. It just drives me crazy when I hear people" claim they can't express their opinions, said Brian Walton, chief negotiator for the guild.)
One TV writer said he had lost $35,000 in the first two months of the strike, while another said he had exhausted his life's savings and was considering a second mortgage. Both said they believed that the union should modify its demands rather than continue to drain members' income.
Several writers claimed to know highly paid colleagues who had put their homes up for sale but were hiding the fact in order not to show weakness that might later hurt them in status-conscious Hollywood. "When people learn that someone's having a problem, their first reaction is to turn away," one writer explained.
Loans to Members
So far, the guild has dispensed $435,000 of its $2.7-million strike fund in the form of 182 interest-free loans to needy members. The loans are reserved for hardship cases but could be used to help a big earner meet payments on a million-dollar-plus home in Brentwood, guild officials said.
A few writers complained of an emotional toll. "My shrink is now an expert on labor affairs," said one guild member who originally voted to walk out but now admits to feelings of admiration for Johnny Carson's recent decision to proceed with his show in spite of the strike. "The guy's got guts," the writer said of Carson.
Some top earners, in meetings and telephone conferences, have proposed a strategy of returning to work while basic issues with the companies are thrashed out. Others have urged the guild to reach separate agreements with many independent companies, to put pressure on the majors and get writers working quickly.
A few have also contended that the guild--about 60% of whose members earn less than $20,000 a year--doesn't reflect the concerns of big-name writers whose regular income isn't dependent on terms of the union's overall contract. "I'm hearing people say, 'I want out of this union,' " said one established TV writer, who claimed he might be fined by the guild if he spoke out.
Lionel Chetwynd and Eddie Anhalt, two leaders of the "Writers Coalition," a loose splinter group of high earners, said their group was not involved in any secession movement. But that group might seek endorsements from enough writers to force a general membership meeting to redefine strike policy.
Walton said such a meeting is likely in the next several weeks anyway, as the guild considers whether to sign separate contracts with about 80 independent firms with which it has been negotiating. He acknowledged that about 10% of the guild's members pay about 50% of its $5.3 million in annual dues. But he said there is "very little evidence" to support the notion that low earners had caused the strike or were hurting less.
In the meantime, thousands of people whose living depends on Hollywood can do little but wait.
At the Enchanted Florist in Toluca Lake, business was off 30% last week, even with the Mother's Day rush, because the studios aren't buying bouquets. According to owner Kimberly Randolph, moreover, some $20-an-hour studio employees have been asking for part-time work in her shop at $5 or $6 an hour, but she's planning layoffs of her own this week.
Meanwhile, over at Barbara's Place, a script typing and copying service on Santa Monica Boulevard in Los Angeles, the story is the same. Business died 10 days after the strike began, and owners Susan and George Johannesson have laid off 20 of their 36-person staff.
"We're working on bank loans, which we'll need even if they settle the strike tomorrow," Susan Johannesson explained. "We've lost $150,000 already."
Times staff writers Kathryn Harris, William K. Knoedelseder Jr. and Linda Williams and intern Elizabeth Hayes contributed to this story.Copyright © 2014, Los Angeles Times