Acquired
02:05:09 · David Rosenthal, Ben Gilbert
[02:05:09] S1: Yep. Decides finally to target Disney employees. Now there's a reason why the Screen Cartoonist Guild had stayed away from Disney despite it obviously being the leader in animation up until this point, which is, I think, Walt's utopian dream more or less was true or at least true enough. Like, he established the bonus pool for animation. He constructed this campus, everything you were talking about earlier, Ben. But here with the cash crunch, that all comes crashing down. [02:05:44] S0: Yeah. There's a great excerpt from the book, the animated man by Michael Barrier. In the spring of nineteen forty one, under pressure from the Bank of America and holders of preferred stock, Walt Disney Productions agreed to scale back its production cost to about $15,000 a week. According to Walt Disney himself, that meant he had to hold the negative cost of new features to about $700,000 or one third the cost of Pinocchio or Fantasia, which was also in development at the time. Since labor costs made up 85 to 90% of Disney's total costs, implementing such severe economies would mean laying off more than half the staff. Oof. So you've got cost reduction in some of the people sticking around, and you've got big layoffs because Pinocchio didn't pay back.
02:06:26 · David Rosenthal
[02:06:26] S1: Yep. Well, layoffs coming. They haven't happened yet. And this is part of why the organization and the strike happens. So hundreds of employees end up striking. They picket the Burbank campus. They march all day. They carry signs with slogans like Snow White and the 700 dwarves, or, one is a drawing of Pinocchio with the caption, no strings on me. The strike lasts for three and a half months, and it's a completely shattering event for Walt personally and for the company. As the union is organizing the employee base in the days and weeks leading up to the strike, Walt decides that he's gonna make a speech and address the entire company, which he thinks well, he will explain his position and the challenging state that the company's in, and it will resolve everything, and the employees will rally around him and the company. Unfortunately, it has the opposite effect. It is a complete disaster. He lectures the entire company for nearly three hours. Some of his lines from the speech, which he had written out ahead of time, so it's preserved, are my first recommendation to the lot of you is this, put your own house in order. You can't accomplish a damn thing by sitting around and waiting to be told everything. If you're not progressing as you should, instead of grumbling and growling, do something about it. And then don't forget this, It's the law of the universe that the strong shall survive and the weak must fall by the way. And I don't give a damn what idealistic plan is cooked up. Nothing can change that. Probably not what you wanna tell your employee base after you just slash their salaries.
02:08:11 · Ben Gilbert, David Rosenthal
[02:08:11] S0: Yeah. Yeah. [02:08:12] S1: A labor magazine would write afterwards, Walt Disney's speech recruited more members for the Screen Cartoonist Guild than a year of campaigning. [02:08:25] S0: Yeah. About the worst reaction that you could possibly have. And Walt, I don't know if you found this in your research, but it seems like he's kinda deluded here into thinking, well, it's not actually my employees that are doing this. It's these communist very few communist agitators Yeah. Who have undercover become my employees, and they're riling up the rest of them. And Walt's, like, kinda removed himself, and he's in denial that this is actually what his workforce wants. The the the family atmosphere that we had at Hyperion is now a, like, real corporate, you know, have and have nots here on the big Burbank campus. Yeah. Yep. [02:09:11] S1: Yeah. It's a mess, and then it gets worse. So in the middle of the strike, which again lasts for three and a half months that hundreds of employees are gone from their jobs that are not working and marching and protesting outside the company. [02:09:25] S0: While they're trying to make Bambi, which is equally ambitious. Right.
02:09:25 · Ben Gilbert, David Rosenthal
[02:09:25] S0: While they're trying to make Bambi, which is equally ambitious. Right. [02:09:29] S1: Walt is just so depressed and in denial and upset about the whole thing that in August 1941, he agrees to go on a goodwill trip to Latin America with Nelson Rockefeller's office of the coordinator of inter American affairs. This is the trip that ultimately results in the, Disney films Saludos Amigos and the Three Caballeros, if you've seen those or been to the Three Caballeros ride in, Disney World in EPCOT. It's actually great. [02:10:00] S0: It also results in Roy having to resolve the strike because Walt is uninterested in dealing with it. [02:10:05] S1: Yeah. The real reason Walt goes on this trip, and he would write about it, he would call it a, quote, godsend and say that it gives him a chance to get away from this god awful nightmare in Burbank. Yeah. He basically just leaves the country and walks out on the whole thing and tells Roy to settle it. [02:10:23] S0: I'm leaving for ten weeks. Do your best.
02:10:23 · Ben Gilbert, David Rosenthal
[02:10:23] S0: I'm leaving for ten weeks. Do your best. [02:10:26] S1: Yep. So while Walt is gone in Latin America, Roy does settle the strike after federal mediation. Disney ends up recognizing the Screen Cartoonist Guild Union. They raise salaries for the remaining employees, and they agree to a negotiated layoff of over 500 employees. So taking total headcount before the strike down from 1,200 to under 700. These are the layoffs, Ben, that you referred to. The studio would never fully recover from this. Certainly, not under Walt and not for many, many years afterwards. Really not at all in the period of classical animation before computer animation comes along. [02:11:16] S0: And sorta equally as importantly, Walt would never recover from this as it pertains to his relationship with the company Walt Disney Productions. [02:11:26] S1: Yes. [02:11:26] S0: It no longer feels like his family. It feels like a creation he's made that has sort of run away from his control. [02:11:34] S1: Yep. He ultimately does decide that the company Disney and he, Walt Disney, have a creative and business future. But, yeah, he never has the same relationship to the studio or animation after this. [02:11:48] S0: Yep. He apparently, according to Don Lusk, who was an animator there, made a list of everyone who went out on strike and said that, everyone on this list isn't true to Disney and one day will not be here.
02:11:48 · Ben Gilbert, David Rosenthal
[02:11:48] S0: Yep. He apparently, according to Don Lusk, who was an animator there, made a list of everyone who went out on strike and said that, everyone on this list isn't true to Disney and one day will not be here. [02:12:02] S1: Yep. So, Ben, you mentioned, Walt's sort of anti communist streak that comes out of this. Yeah. For the rest of his life, he would blame all of this on communist influences in Hollywood. He would actually testify after World War two in front of the House on American Activities Committee, you know, HUAC, as a friendly witness corroborating communist infiltration in Hollywood. [02:12:28] S0: He named names of people who he said were communists Yep. Based on things he had heard about them, like no even proof. And you've got, like, a major figurehead of a big US corporation testifying. There's all this video of it of him saying, I believe so and so is a communist. [02:12:43] S1: Yeah. And, of course, this would lead to the famous Hollywood blacklist and, you know, all the terrible stuff that comes out of that. One thing later sort of by association with this, people would accuse Walt of being anti Semitic since much of the communist movement in in The US and especially in Hollywood was in the Jewish community. Gabler investigates this pretty thoroughly in his book and concludes that there's not any evidence that Walt ever really was anti Semitic. I turned over every stone I possibly could [02:13:12] S0: on this company, and we spent, I don't know, the better part of the year so far researching this, and I found zero evidence of that.