Hollywood's Workers and Peasants

by Jeffrey Tucker - November 3, 2007

Reprinted with permission.

The workers and peasants of Hollywood, formed in solidarity against evil capitalistic sitcom producers, and organizing under the form of the Writers Guild of America, are threatening to withhold their astonishing talents pending an end to exploitation at the hands of their masters.

So goes the conventional story, which is inherently implausible in more ways than we can count. A guild for writers? I'm a writer. You probably are too. My kids are writers. In fact, I don't know anyone who isn't a writer. We think of guilds as a group of medieval craftsmen that had odd skills like glassblowing or horseshoe-making, and they formed as a way of extracting their just desserts against feudal masters.

None of these conditions apply today. The companies we work for hire and fire us freely, and we workers and peasants hire and fire them freely, too, by changing jobs whenever we want and negotiating our own terms. Blessed liberty!

No doubt that some people are better suited to writing funny and entertaining stuff for television than others. How can the producers find out who they are? The same way that most all employers seek employees in a free society: They make it known that labor services are needed. People make an application. They settle on terms, including what is expected in exchange for wages, salaries, and benefits.

Not so in the few industries left that remain anachronistically dominated by labor unions. These people earn high salaries – though, for the life of me, I haven't been able to find data on precisely what WGA members make. You think that would be an important consideration for the public to know.

As best I can tell, the WGA is threatening a strike because the industry pulled in $4 billion for the summer, and now the unions see a chance – without considering that one of the reasons for the high profits is precisely the margin of low costs that they are seeking to eliminate. It's like this: There's a guy with deep pockets, who also happens to employ us. Let's rob him!

Let's just forget all this talk about guilds. These are unions, and modern unions aren't built of a small band of skilled craftsmen seeking to protect themselves from overlords. They are large groups of workers seeking to cartelize themselves against competition from other workers. Exclusion is their goal. And it is pursued at the expense of other writers and consumers in particular. This is why they push, at a national level, laws like the minimum wage and restrictions against full-time work before the age of 18; they want a system in which the few profit at the expense of the many.

But, oddly, union members themselves are also victims of the union because, contrary to the principle of the freedom of association, they are not permitted to break the strike. If the bosses say strike, they are not permitted to work, and woe to the writer who dares think for himself. This collective action of the strike is called solidarity, but this is just another name for coercion.

If you doubt it, look at the strike rules: "There are Rules related to picket lines and other strike support activity, including: honoring all Guild picket lines; performing assigned strike support duties; and informing the Guild of strike breaking activity."

This sounds more like a mini-police state than a freedom-loving union proposing to fight the power. The power to rough up fellow union members is critical, however, to its coercive power. In fact, one of the demands of the Guild is to forbid production companies from using any methods of reprisal against people who strike. Now, imagine that: A company is forbidden from looking askance at employees who seek to harm the company!

And what are some other demands of these workers and peasants?

• We propose to double the home video residual formula from 0.3% to 0.6% for the first $1 million in reportable gross and from 0.36% to 0.72% over $1 million.
• We propose all TV and theatrical content earn a residual payment of 2.5% of the distributor's gross for re-use on non-traditional media, including the Internet, cellular technology and any other delivery system not already covered in the MBA.
• Add a new Sideletter clarifying that the definitions of comedy-variety, quiz & audience participation and "other non-dramatic programs" include reality programs, and provide examples.
• We seek to clarify that ringtones are covered by the merchandising provisions.

Now, if a worker thinks that his ringtone is just the thing, and expects big royalties from it, he or she should be free to negotiate that on his own. That's what folks do in a free society. But organizing the form of a union, and extracting money through what is essentially a forced blackmail, is incompatible with the peaceful and contractual relations that characterize market relations.

One of the main reasons that American job growth is as strong as it is comes down to the decline of union power, which has been a 50-year trend. The peak was 1945, a result of wartime economic planning that had followed a New Deal policy giving unions special privileges in law. It was not lost on people after the war that the unions were wrecking the prospects for economic recovery, so a few rights were granted back to companies, though unions retained the upper hand.

The decline has been steady ever since, falling to a mere 7.5 percent in the private sector (the public sector is a different animal entirely), which is almost but not quite as low as it was in the pre-New Deal period of free markets.

What percentage of the workforce would be unionized in an economy in which free association truly reigned? Maybe 1 percent, or maybe none. That's because unions only benefit themselves at others' expense. And the "others" in this case have every reason to want a chance to work, too, just as companies have a reason to keep the job market competitive.

Why doesn't Hollywood just hire all new writers and tell the unions to take a hike? Well, federal law still requires companies to deal with the unions if they exist. This is fatal. It essentially gives license to the unions to coerce their members into a groupthink, and forces companies and their stockholders to pay vastly more for services than they would in a free market. In short, it is a waste of social resources.

I really have no personal stake in the fate of television studios and their writers. I don't watch the stuff unless I'm stuck at the doctor's office or something. But we all have an interest in freedom and prosperity, and also an interest in reducing immoral behavior in society. Extracting wealth by force is an act of theft. Once you see through the union propaganda, you can see that this is precisely what they are up to.

Jeffrey Tucker is the editor of Mises.org. Contact him at tucker@mises.org.