In Tinseltown, a Rush to Settle and Save Face

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LUCY NICHOLSON /AFP

Teamster Gary Watts (r) and Hollywood writer Rephael Yfrah show solidarity

It’s well past the 11th hour in Hollywood, and yet the town’s writers and producers are still chipping away at a contract dispute, hoping to avert a strike — and its potentially devastating effects on the L.A. economy.

The Writers’ Guild, which encompasses television and movie writers, want two things: Money and respect. They’re demanding more money on the residuals from the shows and films they write, and they also want higher billing on movie screens. Producers initially balked at the demands, but recognizing the power the Guild holds over the industry, they agreed to sit down to talks. The writers’ contract officially expired Tuesday at midnight — but the talks continue as if that deadline never happened.

Meanwhile, on the not-so-distant horizon, an actors’ strike also looms, threatening to bring movie and television production to a standstill if union demands are not met by June 30.

TIME Los Angeles correspondent Jess Cagle has been following the writer/actor/producer negotiations since the first rumbles of discontent. He spoke with TIME.com Thursday morning.

TIME.com: What’s the latest on the Writers’ Guild contract talks?

Jess Cagle: It’s hard to say exactly — a news blackout means that even people in the guild don’t know what’s going on. I do think it’s safe to say that there’s a lot of optimism at the moment (although that could change at any moment, any day) that the contract dispute will be settled.

My hunch is that because the two sides were so far apart when they began these talks, now they’re just trying to save face. Producers are very adamant about not wanting to give the writers any more money on residuals, and writers wanted a lot more on residuals and foreign sales. I bet the Writers’ Guild is trying to figure out a way to say, okay, we didn’t get everything we wanted but we did get this, and here’s why that’s good. Producers are going to grit their teeth and squeeze out a few more concessions without losing credibility.

My sense is that both sides are arriving at a very, very painful agreement. And if it ends up being too painful, one of them may just say no and back out of the talks altogether.

Have the two sides agreed on an extension? Is that why they’re still talking?

As far as I know, there’s been no official extension of the contract deadline. Both sides are still pretending it’s May 1. They worked into the wee hours on Thursday morning, and will go back to the negotiating table Thursday afternoon.

Is L.A. mayor Richard Riordan still putting on a brave face? He’s got to be nervous about the possible repercussions of a strike.

From the start, Riordan has tried to put an optimistic face on the current labor situation. I think he’s really tried to remind the producers and the Writers’ Guild what the implications of this could be. A writers’ strike means people lose their jobs and their homes — and if that strike happens, it’s more likely the actors will strike. The writers and actors essentially want the same thing. At that point, if you have a writers strike in the next few days and then an actors’ strike at the end of June, that’s when the earthquake truly hits the city. You’d see the end of movie production and the end of most television production.

It could be really horrible for the city; a strike could cost Los Angeles $2 billion.

And on top of all that, the actors' unions are making veiled threats that in the case of a strike, actors might not be willing to promote their movies. That, of course, would be bad for media dependent on those interviews, as well as for the producers who count on the success of those movies.

A lot of people might look at a potential actors’ strike and think only of big-name talent and say oh, please, these people don’t need any more money. But in fact, the people who’d be hit hardest by a strike are actors lower down the food chain, right?

Absolutely. Look, if you want to throw your sympathy to anyone in this situation, throw it to the actors, without a doubt. Writers are generally pretty well paid, and producers are going to be fine no matter what. But actors face a huge rate of unemployment, and many don’t support themselves solely by acting. These folks have also just weathered a six-month strike against advertisers, and they’re still trying to recover from that.