Scriptnotes, Episode 634: What If? Hollywood Edition, Transcript

The original post for this episode can be found here.

John August: Hello and welcome. My name is John August.

Craig Mazin: My name is Craig Mazin.

John: And this is Episode 634 of Scriptnotes, a podcast about screenwriting and things that are interesting to screenwriters.

What if Alexander the Great had died at the Battle of Granicus River? What if Robert E. Lee hadn’t lost Special Order 191? Historians consider these questions as counterfactuals, exploring how major world outcomes sometimes hinge on relatively small moments that could’ve gone either way. Today on the show, we’ll explore a range of Hollywood counterfactuals, looking at some moments, people, and events that could’ve gone very differently. And in our Bonus Segment for Premium members, capitalism. Craig, is it good or bad?

Craig: Uh-oh.

John: We will definitively answer the question once and for all.

Craig: Oh, boy.

John: Oh, boy. Craig, it’s so nice to have you back!

Craig: It’s so good to be back. I’m sorry that I was gone for so long. The small matter of directing the first episode of the second season of The Last of Us, which I’m almost done with – we have a few days still outstanding that we need to do in a different location. I’ve been monitoring things on the internet a little bit. People are very clever. They like to see where we’re shooting, and then they have all these brilliant theories about what it means.

John: Yeah, and they’re all right. 100 percent of them are correct, right?

Craig: I wish I could put my arm around each one of them and say, “No.”

John: No. No.

Craig: No, most of the theories are incorrect. Some of them are halfways correct. Some of the conjecture is like 28 percent correct. But I do enjoy it all. I like the interest. It’s fun. But I’m mostly done with my directing stuff and very happily enjoying watching the second episode being done from the more traditional showrunner point of view, which is nice. I do like directing, but also, it’s the most exhausting thing ever. I miss it when it’s over, and then while it’s happening, I just keep asking myself why, why, why am I doing – why did I do-

John: Hey, Craig. Hey, Craig. I have friends who direct sitcoms, and let me tell you, one week they’re in and they’re out. If you could go back, why not make it a sitcom? Then you could direct as much as you wanted to direct, because it’s just a week of your time. James Burrows is not exhausted the way that you’re exhausted.

Craig: No. It sounds like you’re talking about a good old-fashioned three-camera.

John: Three-camera, oh yeah.

Craig: So you’re really just working on a stage play that three cameras are capturing. You don’t have to figure out angles and coverage and turning around. That sounds wonderful. Plus just a week. Yeah, so if there is some sort of box I failed to check to have James Burrows’s career and money… That sounds like a plan.

John: Did I tell you I finally met James Burrows? After all these years, I met him backstage at a play. And of course, as you could expect, the most lovely man.

Craig: I would hope so. If he were just unpleasant-

John: Yeah, a monster.

Craig: … what a weird choice to keep going back and back and back. Those days are kind of over though, aren’t they? The three-camera sitcom is sort of-

John: There are more this development season than in previous years.

Craig: Oh, interesting.

John: Yeah, I think there’s still some hope for it. There tend to be more of the half-hour single-camera things, which again though, are pretty short schedules. Modern Family apparently did a light shoot. They’d show up to the location, they’d shoot every scene a couple ways, and they were done.

Craig: Yeah, the classic network model of doing something like that, the standard is shoot a master and then hose it down, as they say, just simple coverage. If you’re shooting a couple cameras at the same time, the thing about a show like Modern Family is the coverage really doesn’t have to be particularly specific. It’s people talking, and what they’re saying and their faces are the most important things, whereas when you get into these big dramas – and the big dramas are like, each episode is kind of a movie.

John: Oh, yeah.

Craig: Eesh. Oof.

John: Eesh. Yeah. I will say, the shows that are like The Office or like Modern Family, they do rely sometimes on the camera finding a joke, because the conceit, of course, is that it’s a documentary crew, so the camera’s finding the joke at times. Abbott Elementary has the same thing. But it is much more straightforward. It’s a very survivable life.

Craig: I don’t think it requires less skill. It simply is easier from a kind of how much stuff you have to do perspective. But the specific talent required to know where the camera ought to be – and also, editing those shows is very tricky. Editing comedy is incredibly specific.

John: Yeah, it is. Let’s get into some follow-up. This is mostly follow-up on things I think you were maybe not here for, but you could still weigh in. Drew, help us out with some follow-up here. Let’s start with the table reads bit.

Drew Marquardt: A few episodes ago, Jacob wrote in asking a question on whether you should send a script for a table read ahead of time or have everyone read it cold.

John: Craig, what’s your instinct on that? Let’s say you’re doing a table read with some friends. Do you think you should send the script ahead to those folks or have them come in cold to read it? What’s your instinct?

Craig: I’m not a huge table read fan. I think I’ve said that as much. But if I were to do one, I would do it cold.

John: That was Celine Song’s recommendation as well. Jacob wrote in with some follow-up here.

Drew: Jacob wrote, “Our table read was already scheduled for five days after the episode’s release date, so we ended up going with the dual method. Half of the attendees had the script ahead of time, and the other half read cold. And guess what? Celine was right. Our actor friends who had the script ahead of time put way too much energy in coming up with ways to play their characters, and bizarrely, even some had accents. We definitely preferred the read from those who did not have the script ahead of time, but it was still helpful to receive feedback from people who were able to discover the under-the-radar jokes that might’ve required a reread to enjoy.”

John: We talked about this with Celine Song. Mike Birbiglia does this thing where in his development process, he’ll have an interim draft. He’ll have a bunch of his friends, and they’ll have pizza and read through his script. That’s an important part of his process. But he really makes sure that they’re not auditioning for roles in that, that they’re there to read the script aloud. That feels like the right instinct here.

Craig: Yes, it’s especially the right instinct when you’re dealing with maybe actors who aren’t as experienced or at a particularly high level. So I don’t know where Jacob is in his life and I don’t know if his actor friends are well experienced or highly professional or quasi professional or aspiring. The more aspiring they are, the more important it is to not give them the script ahead of time, because they’re just going to do the thing. They’re just going to do it. They’re going to do the thing where they care way too much. That’s not the purpose. The purpose is, I assume in this case, for the writer to hear the words out loud, note the things that do seem to be working, note where it gets slow, note where it gets too fast, etc.

John: We’ve got differing opinion here from a guy who’s done it the opposite way. Drew, help us out.

Drew: Tom Harp says, “I’ve done reads both ways, with writers and with actors. But I wanted to offer my experience as a counter to what John and Celine said. In my own process, my trusted writer friends read early drafts and gave notes. But before I give it to my agents, I always do a read-through with actors.

“During the read, I’m listening to the pace and flow of the dialogue, but maybe the most important part is the Q and A I do afterwards. Actors have a different set of antenna than writers do, and their instincts have saved me several times. I’ve been told, ‘This feels false,’ or, ‘I don’t think my character would do or say this,’ when none of my writer friends noticed it, nor did I, because writers get why the story needs it. But down the line, an actor is going to call emotional bullshit on set, and then you’ve got your production’s boot on your neck as you try and solve it.”

John: Not quite on the same focus here. He’s saying that actors do bring something different to a read, because they’re bringing experience of how to sell a line, and they don’t know how to actually do a line.

Craig: I’m not going to disagree with Tom, because he’s obviously getting some use out of that. The only flag I would wave here is that casting is a thing. One of the reasons casting is important is because you’re trying to match an actor whose instincts match the instincts of the character you have created. When you have somebody show up because they’re available or they are your friend, it doesn’t necessarily mean that they’re the right casting for that part.

And they may indeed think, “This feels false,” or, “I don’t think my character would say this.” A, it’s not their character yet. And B, they might not be right for the part, for that very reason. That’s not to say that there aren’t going to be things that almost every actor in that spot would go, “Oh, I don’t quite understand why I would say or do this here.” So that matters. That logic is important.

But if you don’t pick up on it until the actor comes up to you after, so you listen to the whole thing, sounds good to you, and then they call, come over, and say, “I don’t think that this… ” Maybe it’s just that the actor is not the right actor for that part. That’s the only thing I would flag there. But if it works for Tom, it works for Tom.

John: Yeah. Let’s get to the meat of this episode, which is counterfactuals. Some setup here. Over the last few weeks, I’ve been reading this book called What If?, which is a series of essays edited by Robert Cowley, about military history. We’ll put a link in the show notes to this book. The important part is that it’s really talking through counterfactuals versus alternative history.

I want to spend a moment to describe the difference between counterfactuals and alternative history. A counterfactual is basically the outcome of this battle or event could’ve turned out different in a way that’s very possible. There’s a distinct moment that could’ve gone either way, a kind of a coin toss. And if it’d have gone the opposite direction, outcomes would’ve been very different.

Alternative history I’ll define as something happened in a very different way or in a different timeline, like what if Africa had industrialized first, or we discovered nuclear power in the 1800s? You’d still get to a place where the outcomes are very different, but it’s not hinging on one moment, one thing where it could’ve gone either way.

So we put out this call to our listeners, saying hey, what counterfactuals do you want us to talk through? Some of them were incredibly useful, but a lot of them were actually just alternative histories, where, like, oh, what if this had happened, or what if this had happened, but it wasn’t hinging on a specific event. It was just like, there’s a different version that came out of here.

Some of the alt histories that people proposed, like what if Zoetrope Studios had succeeded, sure, but it’s not based on one movie succeeding. What if Jacksonville, Florida had become the filmmaking capital of the world? It could’ve happened, because it was an alternative way things could’ve gone, but it wasn’t based on one moment that could’ve happened. Or the wars in Europe, like what if the wars in Europe hadn’t happened or had happened differently, and European film industry became the dominant one rather than American? Again, it’s not based on one event. I just wanted to make it clear that thank you for sending those through, but those are really alternative histories and not the counterfactuals I was looking for.

Craig: You were really looking for those fork in the road moments, where there’s definitely-

John: Totally.

Craig: … two ways you can go. Things went left instead of right, but what if they had gone right instead of left?

John: Exactly. The first I want to talk through is Edison. Back in 1915, he’d already invented many incredible devices that we use today, electricity. How he was getting electricity and light bulbs and things out into the world were incredibly important. But he also had patents on the original motion picture camera and projection technology. Because he had this patent and was trying to enforce it very vigorously, a lot of people who were trying to avoid his sort of patent thugs were heading out to the West Coast. It’s one of the reasons why the Hollywood industry developed out in California was just to get away from this guy and his very ambitious enforcement of his trademark over things.

He lost a 1915 court case, which was crucial in his ability to constrain how people could use his devices and whether these things he was creating, these projectors, could only show his own creations. This feels like an important moment in terms of the evolution of the early film industry, so 1915.

Craig: 1915. You have this court case that basically allows an industry to exist. Prior to that court case, everybody had to go through Edison and his company, the Motion Picture Patents Company. I did not know this until – I’m looking at the article that you linked to in the Saturday Evening Post.

When you say “patent thugs,” you mean it. Edison famously occupied a space in New Jersey. There is an Edison Township, New Jersey. I believe that is named for him. But in West Orange, New Jersey, that’s where his base was. He would hire mobsters – and there sure were a lot of them up there on the East Coast – to literally beat up people, filmmakers that were using cameras and film. Edison’s argument basically was, I control the entire chain of creation of motion pictures, from film stock to projection. And anybody that tried to get around him and do whatever they wanted without getting his approval could even theoretically get physically assaulted.

The court case said no. Basically, the court said you can sue somebody for infringing, but you can’t use your patent as, quote, “a weapon to disable a rival contestant or to drive him from the field.”

This’ll tie into our capitalism versus anti-capitalism discussion later on. We used to be quite invested in busting trusts, monopolies in this country, particularly around then. Teddy Roosevelt was quite the pioneer in that effort to create a healthy form of capitalism. We seem to have lost our way. There are a number of companies, I look around now, who I think Teddy Roosevelt would be thrilled to break apart. But yes, if that goes the other way, then John, you and I are probably working in New Jersey.

John: Yeah, I think we’re working for the Edison company or some offshoot of the Edison company. It’s hard to find a perfect analogy for what this system would’ve been like, because it’s not quite like the app store, where everything has to be done through the app store. It’s not quite that. But it is like there’s just basically one funnel, and everything has to either license or be done by this one company. All motion pictures have to go through this one channel, which would be vastly different than what we’re expecting.

Do I think this would’ve lasted forever? No. I think there would’ve been other ways around this, other alternative technologies that didn’t infringe on the patent. There would’ve been ways to do it. But clearly, our early film industry would’ve been very different. What we do goes back to 100 years ago when this was all being figured out.

Craig: It’s almost certain that in order to get around this, a healthy motion picture industry would’ve sprouted outside of the bounds of the United States.

John: That’s a good point.

Craig: Where would that have taken place?

John: France?

Craig: Europe, certainly. But in terms of what we do, the Hollywood style, the very American style of creating things and making a huge business out of it, as opposed to thinking about it specifically in terms of art and cinema, which is a very European and certainly French way of approaching things.

I think about where I’m sitting right now in Vancouver. Canada would’ve been a wonderful place. The immigrants who founded Hollywood way, way back when, Warner Bros and so on, may have just headed up to Montreal or Toronto.

John: Mexico would’ve been another great choice. There’s other venues.

Craig: Lots of sunshine.

John: Again, we are not legal experts in here. This is really our first glimpse of the history here. But it looks like it’s the projection technology is the issue. Basically, if any projector sold in the U.S. could only project things that Edison had approved, that still would’ve been a challenge for American audiences. It’s not just where you film the things. It’s also how you’re showing the things. It would’ve gotten sorted out. There would be some way to do it, but it would’ve really limited the spread of Hollywood movies.

Craig: When you have something that people want, it will find a way to exist. It’s a little bit like Prohibition, which also fell apart a few years after this happened.

John: Rather than the manufacture of distribution of alcohol, manufacture and distribution of film.

Craig: People want it.

John: People want it.

Craig: If you really want to go down that other fork in the road, the movie business is run by cartels, and it is an entirely criminal enterprise.

John: That would’ve been great. That’s a How Would This Be a Movie, because you can envision that. In some ways, the Man in the High Castle and the hidden films, the stolen films of the alternative history, how this all ties back together, is an example of that. There’s a currency for these films that show what happens in the other timeline.

Craig: Yeah, I would see that.

John: Our next one is actually similar. This is the Paramount consent decree, which we’ve talked about on the podcast several times. Again, this is a question of manufacture and distribution of film materials.

Prior to going into this, the very thumbnail version of this, the studios were allowed to also own movie theaters, and they could control the entire channel of, we’re making the movies, we’re showing them in our theaters, we’re constraining all of our product. The Paramount consent decree held that the studios cannot own exhibitors, and therefore films from other companies can be shown in theaters.

Craig: Had that not fallen apart, I think you would’ve seen a creative paralysis in the business. What happened immediately following the collapse of that was the breakdown of this incredibly formalized manner of presenting art to people.

Even though there are incredible movies that were made in the ’20s and ’30s and ’40s, there were also very clearly rigid constrictions. Because it seems like a long time ago, it’s hard for us to see how fast things changed and how dramatically they changed, because it was before our time. But let’s say you were born in the ’30s. You’re used to watching movies of a certain sort. By the time you get into the ’60s, you now have nudity and graphic sexuality being shown on screen. You couldn’t even show people kissing with tongue, and now there’s sex. It’s kind of incredible how fast it changed, because if the studios don’t control the screens, other people can make movies to put on the screens. That’s the big difference. The other people didn’t have to follow along this rigid formality.

John: It’s important to understand this both from a producer and a supplier point of view, because this allowed theaters that were not affiliated with studios to compete for titles they wanted. So it allowed for more independent theaters, but also allowed for filmmaking that took place outside of the studio system. Those are the ones that you first see nudity and moving past the Hays Code and really pushing what cinema could be.

Obviously, this had a huge business transformation on Hollywood, but also had a huge creative impact. If the Paramount consent decree hadn’t happened, we would be in a different place. The irony, of course, is that the Paramount consent decree was overturned in the past 5 years, 10 years. How long have we been doing this podcast? In theory, now studios can own movie theaters. We haven’t seen a huge change in that. They haven’t come in and bought out the AMCs in the world.

Craig: Probably because it’s not a great business to be in.

John: It’s not an amazing business.

Craig: It’s funny, the Paramount decree fell apart right around the time it was no longer necessary, because studios found a new bunch of screens they could control via streaming. However, because of that window from the 1950s through let’s say up to 10 years ago, where the screens were so important, the proliferation of different kinds of content occurred. That toothpaste cannot go back in the tube. We’ve all grown up with and have become used to a certain kind of entertainment.

Ironically, when you look at the movies Paramount itself was making in the ’70s, starting with The Godfather, and onward and the kind of filmmakers they were supporting, they themselves benefited more almost than anyone from this, because they were allowed to make new kinds of things.

The companies do now control their own screens via streaming, but people want what they want. It’s one thing to say, “I want some things that I haven’t seen, but I would imagine I’d like them,” and it’s another to say, “I have seen the things I like. You can’t take them away.”

John: Before we move on, I think it’s worth looking at; both the Edison case and the Paramount consent decree, at the time these things were being decided, the justices and everyone else involved couldn’t have anticipated what the long-term effects are. They could only really look at what is this date right now, because they really couldn’t know what was going to come 10 years, 20 years down the road. I guarantee you that there was not an awareness of like, this will change the type of movies that get made if this gets overturned. They were just looking at it in terms of, this is a law, this is restrain of trade, this is anti-competitive, and therefore-

Craig: Correct.

John: … we’re going to knock these things down.

Craig: If they had taken the other path, I think we would still to this day have a much more restrained kind of content. People look at the ’70s, the freewheeling ’70s, and the rise of the auteurist and all the rest of it as some sort of product of the cultural revolution in this country. And I would argue that no, that is not the case, that in fact, those things happened because of this court case.

I would point directly at network television as proof, because network television is the control of screens. And when you look at what was allowed on network television and is to this day allowed on network television, it is so much more constrained than what is allowed in movies. It’s not even close. Language, nudity, content. There’s just limits. People lost their minds when, in the ’90s, NYPD Blue showed a butt. A butt. They’re still not allowed to drop F-bombs and so on and so forth. I would just say that’s what movies would be like. Movies would be like network television. You’d be constrained.

John: And of course, European cinema, Asian cinema could’ve made different choices. But the problem is, if there’s no way to exhibit those films here, it’s moot.

Craig: That’s right. Absolutely. That was always the case. In the ’40s or the ’30s, people referred to – my grandfather referred to French films. Those were sort of early Blue Movies with nudity. Sure. But mostly, it would have operated the way network television still operates, under those constraints, which some people argue are positive on some levels. Creative restraint does force certain kinds of creative creativity. But you would not have the things that we have in movies if this had not gone that way.

John: Yeah. Simpler what ifs. What if George Lucas had died in his car accident?

Craig: Oh, god.

John: This is June 12th, 1962.

Craig: Oh, god.

John: “As Lucas made a left turn, a Chevy Impala came flying from the opposite direction and broadsided him. The racing belt snapped, and Lucas was flung onto the pavement just before the car slammed into a giant walnut tree. Unconscious, Lucas turned blue and began vomiting blood as he was rushed off to the hospital.”

This is George Lucas, who at this time is a promising young film student. I guess he’s made some stuff at this point, but he had not made Star Wars. He had not made Raiders of the Lost Ark. How different would it be if we did not have George Lucas as a filmmaker? What are the knock-on effects of this?

Craig: For starters, I just want to say as an unlicensed doctor, if you turn blue and start vomiting, it’s not good. That’s really bad. There’s two ways of looking at this. One way is – let’s go the obvious way – George Lucas doesn’t create Star Wars. He doesn’t bring about the era of the blockbuster. Movies stay a bit smaller. Special effects and visual effects do not advance as far as they did and as fast as they did. The hyper-merchandization of films and the creation of so-called franchises does not occur.

However, a couple of counter-arguments to that. One is that somebody else probably would have done something of the size that would’ve created that anyway. George Lucas was really important, as we’ve discussed, in the creation of Raiders of the Lost Ark, but I do feel like there’s going to be a – Steven Spielberg was making his own blockbusters, Jaws.

John: He’s making Jaws. He’s still making blockbusters.

Craig: Yeah, I think there’s going to be blockbusters. But just as importantly, it seems like George Lucas’s brush with fate here was actually quite informative to him as a filmmaker. He sits there in the hospital and starts thinking about what saved his life in that car, and eventually, I think that sort of turns into American Graffiti. There’s this world where it’s like, if he doesn’t get into the – he needs to get into the car accident, I think.

What happens? If he dies in his car accident, we don’t get these movies. If he doesn’t die in the car accident, we do get these movies. We definitely wouldn’t have Star Wars. There would be no Star Wars. That’s for sure.

John: A world without Star Wars is different. Beyond the business things you’ve laid out, how it popularized a kind of space opera, children’s stories but for all ages, it did a very specific thing. We already had Star Trek. Star Trek would still exist without Star Wars, but I feel like we kind of need both of those things for in order for us to have-

Craig: Sort of. Star Trek is a network television show that gets canceled after, I think it was three seasons. Then Star Wars happens, and shortly after that, Star Trek the movie happens. Star Trek the movie does not happen if Star Wars doesn’t happen. There’s just no chance.

John: Very good point. Very good point.

Craig: Similarly, all the movies that were inspired by Star Wars sort of happen. The movie that’s coming to mind actually is Dune, because Dune was really the only thing that could’ve been Star Wars, because it preexisted Star Wars as a novel. Maybe the Dune that gets made doesn’t get made. I don’t think the Lynch Dune gets made without Star Wars.

John: And the Jodorowsky Dune doesn’t get made either.

Craig: I agree. That’s not going to get made either. But at some point, somebody, let’s say it’s Spielberg, in the absence of a huge-

John: Or Coppola or somebody.

Craig: Or Coppola or somebody. Somebody figures out how to make Dune and gives us the Denis Villeneuve standard type Dune earlier, and that leads – because there’s obviously great interest in those large-scale science fiction fantasies.

John: Because it’s crucial to understand there was a huge science fiction community before Star Wars. It popularized it in a way that was important. I think you don’t have the volume of science fiction fandom until you have Star Wars.

Craig: Star Wars, it was like giving a very loud and passionate fan base the world’s biggest megaphone, because everybody sort of flooded into the tent. It’s a really interesting thing, a world without Star Wars.

A fun thing I do like to think about when we’re talking about these counterfactuals is that we are currently living in counterfactuals, meaning in our world, Melissa Suzanne – the worst fake name ever – Melissa Suzanne does die in a car accident, doesn’t make blah da bloo, which is the biggest fricking thing of all time in that, and we’re living in the counterfactual where it didn’t happen. We don’t know what we don’t have.

John: Exactly. Yeah, we don’t. Let’s talk about another movie that it would be different if it hadn’t existed, which is Titanic. You and I were both in Hollywood as Titanic was happening. Some backstory for folks who don’t know. Filming was supposed to last six months. It stretched to eight months. The budget doubled from a reported $110 million, making it even costlier than Water World’s $200 million price tag. Another counterfactual would be like, what if Water World were a hit? But it was not a hit.

Titanic was incredibly expensive. Craig and I will both testify to the fact that there was real discussion about, “Oh my god, this movie could be a disaster. It could completely tank.”

Craig: Absolutely.

John: And sink both Fox and Paramount, who were both putting up the money for it. That didn’t happen. It became a giant hit and changed exhibition. It just kept running and running forever, despite its long running time. What happens, Craig, if Titanic had tanked, sunk?

Craig: The thing is, we do live in the world where these enormous movies tanked and sunk. That one might’ve killed Paramount. Paramount I believe was the initial production company. And it got so bad that they had to go to their competitor, Fox, and say, would you basically put in all the money we put in, on top of the money we put in, and we’ll give you all of the international, I think is how it worked out. That’s unheard of. I don’t even think it’s happened since on that scale. I think in part it hasn’t happened since on that scale because Titanic did become a huge hit. And the only thing that scares these companies more than a massive bomb is missing out on all of the money of a massive hit.

John: Of a hit, yeah.

Craig: But I think we would still unfortunately be in a world where some massive films just tank because people take these big swings. The weird thing about Titanic succeeding is that it probably has created more flops in its wake, because everyone goes, “What if it’s Titanic?” Then someone’s like, “We’ve done research, and it’s projected to only make… ” I think Titanic its opening weekend made – $28.6 million is what it made, which is really good for 1997.

John: Really good.

Craig: Very good opening weekend.

John: For a four-hour movie, yes.

Craig: Yes, but if it followed what normally happens, which is then the following weekend would be, let’s say-

John: Drops 50 percent, 40 percent.

Craig: Yeah. Let’s say the following weekend’s like 15 million, and then it goes to 7 and 3 and 2.

John: Disaster.

Craig: Oh my god. But in fact, it made more. It went up. I just remember how it just kept making somewhere in the 20s every single weekend forever. There’s never been anything quite like it, box office wise.

John: My husband, Mike, was running the AMC Theatres in Burbank at that point. He had 30 screens. And Titanic nearly killed him, because they’d add screenings and those would sell out. So they’d add 9:00 in the morning screenings and not even advertise them, and they would sell out. It was crazy. Yes, it’s really good money for the exhibitors, because they’re getting a cut of that, but it was just so hard on everybody, just staffing those endless screenings.

Craig: The creation of that movie was incredibly difficult to do. It is certainly no fun to be making something that massive while the people that are paying for it are freaking out and basically telling you, “We’re screwed.” Making things is hard enough. When you are confidence shaken, it’s really hard, because you already want to curl up and die just from the exhaustion of doing it. And Titanic was an incredibly exhausting thing to make. To think, while you’re making it, that also everyone’s miserable and it’s going to fail, oh my god, how do you even wake up in the morning?

John: But you do.

Craig: They did, and so people just keep pointing back at this and saying, “Look.” The one thing I think that would be different is maybe there would be fewer flops.

John: There’d be fewer big swings. I think there would’ve been someone going like, “No, we absolutely cannot do this thing.” One thing that is different about our current moment is we have some places that have so much money, and they don’t actually need the box office, but they can just spend a ton. Apple, on Killers of the Flower Moon. In any normal situation, that would be a disaster. But it’s not a disaster for them, because they kind of don’t really care about the money. And so they can make a very long, very expensive movie that doesn’t perform at the box office, because that’s not really what they care about.

Craig: Yeah, and similarly, Netflix doesn’t – I don’t know what their metrics – I don’t know how any of it works. I work for a company that is oddly old-fashioned in the sense that even though there’s a big streaming service for Max, a lot of people still watch HBO through cable or satellite, and those are subscriber fees that get paid in, and there’s ratings for that stuff. But yeah, Netflix makes these enormous things and go, it kind of doesn’t matter. I don’t understand any of it.

But certainly in the case of Amazon and Apple, those companies are so enormous. Their production wings are such a small piece of what they do, that they can easily absorb any of these things. No problem. The world of Titanic, it was back – I don’t know, who owned Paramount back then? Was it Gulf Western?

John: It could’ve still been Gulf Western.

Craig: That was a big oil company. If you read about the history of The Godfather, for instance, they were all freaking out when they were making The Godfather, because they were going to lose – they couldn’t stand the notion of losing money.

John: There was a history of disastrous films costing studios so much they had to change, like Cleopatra and Fox. We have Century City in part because Fox had to sell off some of that lot to actually earn money, and that became Century City.

Craig: Exactly. There’s Heaven’s Gate, which basically destroyed a studio. There’s been movies that were so big and so massive and so horrifying in terms of their costs that just entire companies fell apart.

John: A movie that did not cost the company but was a big swing and a big miss was John Carter. John Carter of Mars was a film that Disney made. We’ll link to an article by Richard Newby for The Hollywood Reporter, called John Carter Changed Hollywood, but Not in the Way Disney Hoped. Based on the numbers, John Carter earned $284 million on a $306 million budget. That sounds like, oh, it was close, but of course, there’s hundreds of millions of dollars of marketing on top of that.

Newby argues that Disney realized, like, “Okay, we were trying to create Star Wars. Maybe we should just buy Star Wars.” They might not have reached for Lucasfilm at that moment if John Carter had worked. Possibly. They also were coming off other challenges, like The Lone Ranger, which was another expensive flop. And Newby argues that because of back-to-back misses, Disney got very conservative and were just banking on sure bets.

Craig: I’ll push back a little bit on this one.

John: Please.

Craig: It seems like Mr. Newby’s hanging a little too much around the neck of John Carter. Yes, it was a flop, but it wasn’t a studio-destroying flop. $284 million against $306 is not good, obviously, because that doesn’t include the, let’s say, $100 million of marketing. And then, of course, they don’t actually get all the money from the ticket sales, but there was video and all the rest. I’m not sure that that’s why they said, “We need Star Wars.” I think anybody who has the chance to get Star Wars and has the capital to do it and also the brand that would convince Lucas to allow it-

John: Exactly.

Craig: … which in this case was Disney and no one else, unless there wasn’t an old existing Paramount that wasn’t there anymore, of the way that he was familiar, yeah, I think anybody would buy Star Wars. I don’t think that you can put too much around the neck of John Carter. The fact is he cites Lone Ranger as an example of how it didn’t help matters. But that’s proof that John Carter wasn’t enough of a cage rattler, because they did make Lone Ranger, so I don’t know.

John: Let’s rephrase this though. Let’s refrain it. Rather than saying what if John Carter hadn’t bombed, what if John Carter was a huge, huge, huge hit? What if it were kind of Star Wars level? That I think would’ve been a bit of a game changer, because then it would be validating, like, yes, let’s spend a lot of money, take really big swings on pieces of IP that are kind of known but not hugely known. I would say John Carter of Mars is more in the level of a Narnia book, in the sense of people kind of know what it is, but they’re not necessarily directly familiar with it. That could’ve changed some things. If it were a giant hit, would they still have bought Lucasfilm? Probably, because they would just have so much money.

Craig: I think it’s still probably presuming too much logic on the part of the folks that make these things, because there’s always been this strange gravitation towards, quote unquote, IP that I think most people would look at and go, “Okay. If you think that that matters.” When they made – what was the one with Billy Zane? Was it The Phantom?

John: Yeah.

Craig: The Phantom, that was something-

John: In Europe, yeah.

Craig: My dad was into that, barely, as a child. It was not relevant anymore. But it seemed like, oh, that thing. Now, in the age of algorithm-driven companies, I think the computers, as much as we hate them, probably would’ve said, “Please do not make The Phantom.” But you still see what I would call attempts to recreate other people’s large successes. And they sort of work, or sometimes they don’t work.

Amazon and Netflix, without naming names, have certainly tried to reproduce their – “We want our Game of Thrones. Where’s our Game of Thrones?” Then they go looking for IP that people are sort of interested in or maybe not that interested in. Some of it works great; some of it doesn’t. It’s hard to predict sometimes. There are book series that people love but just don’t want to watch adapted. There are other things that people don’t really care that much about, but when they get adapted, catch on. It’s not as logical as all that.

I think if John Carter had been a hit, I don’t even think it would’ve stopped Disney from buying Star Wars. The only thing that would change: a lot more John Carter movies and then a whole lot more movies that are sort of John Carter-ish that don’t work.

John: Agreed.

Craig: When I was a kid, my dad said, “You’re going to love these books. When I was a kid, I read them. Doc Savage.” You know the Doc Savage books?

John: I recognize the title. I don’t know anything about them.

Craig: I think they were, I want to say 1930s era.

John: They were pulp fiction.

Craig: Pulp fiction, adventure stories, largely for boys, about a group of courageous people that go on to the far-flung reaches. Doc Savage was definitely an inspiration for Indiana Jones and even James Bond to some extent. Every now and then, somebody would bring it up in Hollywood as I was coming up. Now I’m like, that’s so old. Maybe there’d be a bunch of Doc Savage – or a Doc Savage movie would’ve been at a large scale and failed. But I don’t know if the world would’ve changed that much if John Carter had succeeded.

John: But Craig, what if Iron Man had bombed?

Craig: Oh, boy.

John: I think we’ve talked on this podcast before – I carried a football on Iron Man for just a couple weeks. I love everybody involved. I got to go to the premier. I remember going to the premier and the after-party at the Roosevelt Hotel across the street and saying, “Wow, that was really effing good. That’s going to be a giant hit.” But I will tell you that there was no guarantee that movie was going to be a giant hit.

You look at the folks involved, like Favreau, so smart, so great, had done some movies, but there was no guarantee that he could direct this movie. There was no guarantee that Robert Downey Jr was a good choice or even a rational choice for this, because he was not in the best place in his career. There were a lot of things that could’ve really derailed this movie, and yet it was a giant hit and started a franchise, which has made billions of dollars for the companies involved.

Craig: Billions and billions and billions and changed the shape of multinational mega-corporations.

John: It’s important to acknowledge that there were multiple movies before that that had not worked, and we’ve still got the Marvel Universe. But I would argue that if Iron Man had flopped, you doing have the Kevin Feige Marvel Cinematic Universe.

Craig: Without question. Without question. You could even go further back and say what if the X-Men movies flopped? Because superhero movies – other than Batman always seemed to work, Superman worked for-

John: Sometimes.

Craig: … two movies. But the other movies that they tried to do, the other things they tried, it all just, eh. Spider-Man also is another one where if that had not worked right…

There were preexisting superhero films that had done well, but those were not controlled by Marvel per se. X-Men was controlled by Fox. Spider-Man was controlled by Sony. Batman was controlled by Warner Bros. Here’s Marvel as a company suddenly finding a partner to make Iron Man with and do it well, and that directly leads into the entire Avengers thing. It also created all the feeder ones, Thor. Obviously, you never get to Guardians of the Galaxy or any of that stuff.

John: No, none of that stuff.

Craig: Ever, ever, ever.

John: I will acknowledge that if you had Iron Man but didn’t have a good follow-up with that first Captain America movie, it would’ve been much more difficult. But you have to have Iron Man first. But the whole choice to center this whole thread on Iron Man was a weird one too, because he wasn’t the biggest available hero there.

Craig: No. I loved Iron Man comics when I was a kid, because the suit’s awesome. But the actual Iron Man stories got kind of morose. He was an alcoholic. The comics went into a whole story about alcoholism.

Also, you would not have the superhero saturation and the way that superhero films… There’s going to be some amazing books written 10 years from now about it. The transformation of our culture by that movie and everything that came beyond it is remarkable. What it did to our business, for better or worse – and in a lot of cases worse – is remarkable. What it did to the visual effects industry but also technology is remarkable.

And then here’s this question: does any of this work without Iron Man? Does any of this work without Tony Stark, Robert Downey Jr, or does it just begin to fall apart? Obviously, Marvel has created this incredible system with phases.

John: We’re in a struggling phase right now. I think it’s not hard to see. We don’t know what’s going to happen next.

Craig: That’s right.

John: I think on our next episode, we’ll talk a little about when you hire stars, how careful you have to be, because they are going to be the face of your entity. In the case of Jonathan Majors, that did not work out well. In the case of Robert Downey Jr, it worked out great. But if you were to look at those two people at the start, I would’ve bet on Jonathan Majors.

Craig: I don’t know what was known, but here’s what was definitely known about Robert Downey Jr prior to Iron Man. He had gone through a very long period of substance abuse problems. He had gone through a very long period where he was highly unreliable. He was considered to be mercurial and brilliant but uncontrollable. He had had issues with the law. There was an infamous story where he just woke up in somebody’s bed in a house, because he broke in, because he was completely out of his mind on whatever he was – I don’t know what substances he was abusing. There was this sense that the last person in the world you put an enormous thing on top of would be Robert Downey Jr, and they just went for it.

John: They did.

Craig: This is the weird thing about trying to game or predict. You want the real hero here. If I can point to one person that is the reason why our culture is full of superhero movies and why Marvel is worth as much as it is and has had as much success, Susan Downey, Robert Downey Jr’s wife and producing partner, who is the stabilizing force in his life, who clearly got him back on track and got him sober and focused. If Hollywood could give a Nobel Prize, it should go to Susan Downey. She’s remarkable. As far as I’m concerned, Marvel should write her a check for a billion dollars.

John: Let’s do a very short version on this. We’ve talked about fin-syn before. Fin-syn limited the degree to which networks could own the production entities. It’s like Paramount consent decrees in the sense of it’s about how much vertical integration you could have over the course of production. It was abolished in 1993 by a decision. It counts as a counterfactual, because the decision could’ve gone the other way. In a short version, if in 1993 fin-syn hadn’t been eradicated, how would Hollywood look different today?

Craig: Oh, boy. You can argue in a lot of different directions here. The deal with fin-syn is it created a system where the only people who could afford to produce television good enough to be on networks were companies that could afford to operate under a system called deficit financing. The only way you could make money making a television show, because the networks couldn’t make them – therefore the networks made money off of licensing, so the networks pay you money to license the show you produced. They run it on the air, and then they sell ads. The amount of ads that they sell hopefully is way more than the licensing fee they’re paying you. But how do you make money? You don’t, because the licensing fee doesn’t even come close to paying you back.

John: To covering your costs.

Craig: Doesn’t even come close. The only you make money-

John: You’re relying on syndication.

Craig: Exactly. Basically, you need a hit. If the show makes it to, 100 episodes was considered the classic number to hit, then it could be syndicated, meaning it could then go into reruns. At that point, it just starts to spin off insane amounts of money through licensing fees forever. The game was, right, we’re going to lose a whole lot of money to make a whole lot of money. The only people that can afford to do that are very large companies; in this case, movie studios, basically. Those were the ones doing it.

John: If fin-syn hadn’t gotten shut down, you can imagine somehow more capital would’ve flown in to create more things that were like the Carsey-Werners and that stuff. The experienced producers would somehow be able to raise enough money to be able to make the shows they’re going to be able to make. But it would still be dicier. Those people would be very wealthy in hits, but these companies would also go bankrupt more often. Generally, you want to strike down vertical integration where you see it, because it is anti-competitive. It can drive down wages for people, because there’s fewer places you can sell your thing.

But it would’ve greatly changed how we’re doing stuff. It’s hard to know what would this look like in today’s streaming world, because there are companies that bring their own money to do stuff today. Those things still exist. It’s just different. You have the Legendaries. You have the Fifth Seasons. You have the companies that actually are coming in with their own money to do stuff. It would look a lot different. I can’t even suss out what the real changes would’ve been.

Craig: I think that you would probably have had much larger productions. We can look at companies that are not impacted by fin-syn. Fin-syn fell apart. But when you look at Netflix, for example, Netflix produces and distributes their own material. They are not beholden to these rules. The reason that fin-syn was a thing is because it applied to broadcast television. Broadcast television used the public airwaves to send their signals out, so the government therefore had the ability to get in the way and create regulations. There’s no regulations on an end-to-end agreement like Netflix, where they’re not using public airwaves whatsoever.

John: The FTC or the Justice Department could still come in there, but without the broadcast aspect of it, it’s much harder to enforce anything like that. It’d be much harder for them to win the judgment they would have to win.

Craig: Yes. The government has a clear, established interest in the rules regarding the use of public airwaves, going all the way back to the age of radio and so forth. But with internet carriers, it’s different. Netflix and companies, Amazon, etc., they’ve never operated under anything like this. They’ve always been able to make their own stuff and exhibit their own stuff. And what you see are massive productions, because there is no arrangement where you deficit finance in the hopes for syndication, and meanwhile the exhibitor is making money off of the sale of ads. In fact, Netflix and Amazon don’t have ads, although now they’re starting to. But even then, they’re starting to just put more money in their pockets.

I don’t know how the finances of these companies work, but you could argue that for Amazon, for instance, it’s possible that their production wing is really a loss leader, and it is a deficit financing, just to drive customers to their other aspect, which is buying toilet paper and pencils. I don’t know. But it does seem like if there had not been fin-syn and the networks could’ve reaped the benefits of their own syndication, that probably you would’ve seen some larger productions happening.

John: Last bit of counterfactual. Remember when Netflix was red envelopes you got in the mail?

Craig: Yeah, I actually do.

John: What if Netflix had stuck with their DVD model, that they were a company that sends you DVDs?

Craig: This is a great one.

John: They never started a whole streaming business. How would the world be different if Netflix hadn’t started the streaming revolution?

Craig: I’m going to contradict myself a little bit here. Most of what I’ve been saying is when the world wants something, it finds a way to get it. In this case, I suspect that if Netflix hadn’t done what they did, nobody would’ve done it. The reason why nobody would’ve done it is because I’m not sure it, meaning the streaming model, actually makes sense. We watched this happen. Netflix did this. They churned through an enormous amount of money to build the business out of nothing, a little bit the way Amazon did with their larger business.

John: Totally.

Craig: Then everybody else said, oh my god, we have to do it too. Then they all looked at each other and went, “How do you make money doing this exactly?” That makes me suspect nobody would’ve done it, because it doesn’t make sense. A lot of what we all went through with our convulsions in the labor movement in Hollywood was trying to make Hollywood confront the fact that they had blown up a system that worked fairly well for them and fairly well for us. They had blown it up chasing something that wasn’t like them and something that they could never be like. I think the world would be enormously different if Netflix had just stuck to the red envelopes.

John: Counterfactual to your counterfactual. I would say that internet video is going to want to happen. The fact that YouTube exists, there was a market for – people wanted to watch things through video. Even before we had Netflix, we did have webisodes of your favorite shows. The idea that we were going to be getting our TV or TV-like things over the internet I think is kind of inevitable.

The business model behind that could’ve gone many, many different ways. But I do think you would’ve ultimately seen things that looked like Netflix that were using money they got from investors to create shows and put them on the internet. And some of those would’ve grown into things that are maybe not the size or scale of what Netflix became, but it would’ve been big enough that even the other studios would’ve developed their own wings that were doing that kind of stuff. We would’ve gotten to something that looked like what we’re doing now, but just not with the full scale.

Craig: I think you’re right that in terms of a distribution platform, places like YouTube would’ve absolutely worked, and they kind of were. If you think back to what we were arguing about in our penultimate strike, the big concern was that the companies were going to use the internet to run our content and have ads run in it, just like it would on any syndicated channel, but because it was the internet as opposed to Channel 5 in New York, that somehow residuals wouldn’t apply.

I think YouTube did and continues to have a very robust system where they run ads. Yes, I think they would’ve struck deals with the companies to rebroadcast stuff. I think the whole thing of like, “YouTube is going to make its own stuff,” they sure tried. It didn’t work. What was it, YouTube Red? That was sort of a thing. Is it still a thing? I don’t even know if it’s a thing.

John: They got rid of YouTube Red.

Craig: They got rid of it. They got rid of it. Quibi. Good lord.

John: If it weren’t for Netflix, then we would’ve never had Quibi.

Craig: We would’ve never had the 4 million easy jokes about Quibi. The idea that these independent internet companies would… Remember Amazon Studios? Remember us discussing that whole baloney nonsense?

John: Yeah. They were always looking to do a thing. But again, Amazon still, with all their money, they probably would’ve tried to develop something that – again, it’s not Netflix, but they would’ve developed their own-

Craig: Maybe.

John: … video streaming service.

Craig: Maybe, or maybe they would have just said, “We are happy to be in the business where we pay you a licensing fee to rebroadcast your stuff on our platform,” just like Walmart pays for the DVDs that they then resell. And then Amazon, just like anything, will collect the ad money, and that’ll be that.

John: They probably would’ve looked at YouTube and said, “We want to be in the YouTube business,” and the revolution of that.

Craig: Where the internet was before Netflix decided to go bananas was this… You and I got yelled at a lot, as I recall, for decrying the concept of the democratization of entertainment creation. There are certainly a lot of people making money as influencers and all the rest of that, but that’s its own category.

There was this moment, and we were podcasting through it, where these companies were like, “The only reason that everybody doesn’t have great television to make is because of the gatekeepers, and if we just allow everybody to … ” No. The answer to that is no. None of that would’ve happened. None of that ever will happen. That’s not a thing. It doesn’t happen. It’s hard to do what we do. There are not a lot of people who do it.

It’s sort of like saying, “We’re going to democratize Major League Baseball. Everybody can show up and play.” Nope, actually, we still just want Juan Soto, which as you know, Juan is going to take the Yankees to the World Series this year. I know that you’ve been thinking it.

John: I basically stay awake at night really thinking about all the scenarios that gets him to the World Series.

Craig: Soto and then Judge, that number 3, number 4 lineup punch. We’ve talked about it a lot. It’s a big deal.

John: There are so many scenarios that it’s why I can’t sleep.

Craig: There’s really only the one scenario.

John: But you never know. The counterfactual is that, what if he gets hit by a bus, and therefore-

Craig: I’ll tell you, if Juan Soto gets hit by a bus, the Yankees will have another season like they did last year, which is really bad. David Benioff, John Gatins, and I have a little three-person group chat that is just nothing but us complaining about the Yankees. That’s all we do. It is just a constant ruing. This season hopefully will be different.

But in any case, I really think that what Netflix did was so improbable and so risky and so crazy. I’m still waiting for gravity to kick in.

John: It has basically worked for Netflix. It has not worked for everybody else. Netflix now actually makes a profit. But it was a wild, wild gamble. And they were able to use cheat money to do it. The circumstances worked out the way they worked out.

Craig: The circumstances worked out the way they worked out. I think the proof is in the pudding. Even as Netflix started to be successful, the legacy companies still weren’t like, “Oh god, we gotta … ” No, they were like, “Great. Keep licensing our stuff. Here. Friends. Give us money. You can run Friends.” It really wasn’t until they felt that there was an existential threat to their existence, and I think that was a miscalculation, by the way.

John: Here’s a question for you. Let’s say streaming never happens. Netflix doesn’t happen, and streaming never happens. Do the cable companies get even more powerful? Because they were the people not making the shows, but controlling access to people’s TVs.

Craig: Cable and satellite become more powerful. It is possible that a company like YouTube, which has successfully replaced a lot of cables and satellite dishes, would have become the other new dominant delivery system, but they would’ve been a delivery system. They wouldn’t have been a creation/delivery system. That’s the difference.

John: I agree. Let’s wrap up our big counterfactuals segment here talking through why I think it’s useful. It’s because when you look at the coin tosses, the ways things could’ve gone one way or the other way, you recognize that, as you said before, Craig, we are in a counterfactual. We’re in somebody else’s counterfactual. Things worked out the way they worked out, but they were not inevitable. We have to be mindful that the choices we make now will have repercussions down the road that we can’t always anticipate. I think it’s always nice looking at this ecosystem we find ourselves in was not the only possible version of this.

Craig: No. It is an either distressing or comforting notion to think that we are in the alternate reality, and in our version of the sim that we all live in, yeah, we’re missing some awesome things or we dodged massive bullets.

John: For sure. Craig, it’s time for our One Cool Thing.

Craig: Yay.

John: We haven’t done a One Cool Thing together for a while.

Craig: Yay.

John: Mine is on post-quantum cryptography, which is a mouthful but actually makes a lot of sense. I’ll link to an Apple Security blog post they did about it. The idea of post-quantum cryptography is – obviously, cryptography is so important for securing our communications. It’s making sure that the things we want to say private stay private, and messaging, all that stuff. Right now, we are using cryptography which is so strong that computers could spend 1,000 years trying to break the codes behind stuff, and they wouldn’t be able to open these messages. The problem is, at some point we’re going to get to quantum computers that are so powerful and so fast that this cryptography will fall apart. It will not be useful.

And so a thing that is happening is very well-resourced companies or nations can just say, “Okay, we’re going to suck up all this data. We can’t actually process it now. We can’t actually break the codes. But we know that in a couple years, we will be able to.” This becomes like, then how do you prevent that?

This paper goes through these plans for and these actual new algorithms to figure it out, for living in a post-quantum cryptography world, so basically, how do you encode things now so that as quantum computers come online, you still can’t open those messages.

The good news is there’s math that can get you there, so that it’s still going to be incredibly difficult for these super-super-super-computers to open those messages. There are things you can turn on now or soon in these messaging platforms that will keep stuff locked down whenever these quantum computers come online. Interesting. I like that it’s both dealing with problems now and problems 10, 20 years from now.

Craig: That’s smart. Phew. There is a problem I hadn’t thought of. Thanks. Now I’ll be awake at night. My One Cool Thing is a bit sweeter, pun intended, but also a bit sad, and somehow one of the most gripping articles I’ve ever read about marshmallows.

John: I love marshmallows.

Craig: John, have you ever had a Smashmallow?

John: I don’t know what that is.

Craig: Neither did I. Drew, Smashmallow?

Drew: I’ve never had a Smashmallow.

Craig: Apparently, these were a bit popular a bit ago. There’s this guy, Jon Sebastiani. This is an article in Business Insider. Jon Sebastiani is a scion of a big wine company in Sonoma. He created the company Krave, with a K, which makes fancy beef jerky and so forth. He got into this new area of creating fancy marshmallows, fancy handmade marshmallows that were delicious and had lots of different flavors, and they were hand-cut. And people really dug them.

Then he decided, “It’s time to upscale this business. Let’s go big.” What ensued was an incredible collision of desire and reality, on an engineering level, because as it turns out, making marshmallows to scale is enormously hard. The marshmallows that we all know, Stay-Puft Marshmallow Man, Kraft marshmallow type marshmallows, the reason they are the way they are and they just all vaguely suck is because that’s as good as they can do. Even the shape is necessary. Those are cylinders. Smashmallows were handmade. They would make these big slabs and cut them in squares, and people really liked the squares. Making squares at scale, making cubes, really, really hard.

What happens and how this whole thing falls apart is actually fascinating from a chemical, physical, and business level. And of course, it all comes tumbling down. There are lawsuits. And Smashmallow is no more.

John: It’s great. As I’m skimming through this article, it’s the Theranos of marshmallows.

Craig: Isn’t that great? It really is. When you read it, you’re like… People were lying. He’s looking for this company that can build new machines to make the Smashmallows at scale. This company, I think it’s in the Netherlands, says, “We can do it. We can do it. We’re going to send you a sample of what we made to show you.” He was like, “Oh my god, you did it.” The big secret was they didn’t make that sample with a machine at all.

John: It was handcut.

Craig: They just lied.

John: They lied.

Craig: They just lied.

John: They lied.

Craig: Just lied.

John: This past week, I had to go in for a blood test, and I remember coming back and telling Mike, “Man, I was there, and it just seems really inefficient. I felt like there’s a way you could have a machine that could just do this for you.” I’m like, “Oh shoot, I’m pitching Theranos, aren’t I? I’m going to stop right now. I am pitching Theranos.”

Craig: Just to tie back to our counterfactual, was her machine called the Edison?

John: Maybe so. A counterfactual is, what if she’d actually been able to make that machine? In theory, it’s a really good idea. But apparently, it’s like the Smashmallow. Yes, you think you should be able to make that thing, when it turns out you can’t.

Craig: I think if she had been able to make that machine, somebody would’ve made that machine already. When she was like, “We’re going to take a drop of blood and do all of your blood tests from a drop of blood,” I remember her mentor at Stanford, this wonderful professor, just said to her, “No. That is literally physically impossible on a molecular level.” But there was maybe slightly more of a chance that the marshmallow thing could’ve worked.

John: I’m sure that professor would’ve told Thomas Edison that he couldn’t make a motion picture projector, and look at him, he did.

Craig: Definitely a better chance of that than the-

Drew: Theranos machine ever working.

John: Theranos machines. Craig, a pleasure talking with you again.

Craig: Great to be back.

John: Scriptnotes is produced by Drew Marquardt.

Craig: Yay!

John: Edited by Matthew Chilelli.

Craig: Hooray!

John: Our outro this week is by Zach Lo. If you have an outro, you can send us a link to ask@johnaugust.com. We love when good outros come through. Reminder that outros involve some version of (sings). You can hide it in there, but I’m always listening for it. Sometimes we’ll get these outros that are like, that is musically beautiful, but it’s not a Scriptnotes outro. You gotta get that in there. We gotta hear that.

Ask@johnaugust.com is also the place where you can send questions. You’ll find the show notes for this episode and all episodes at johnaugust.com. That is also where you’ll find the transcripts and sign up for our weekly newsletter called Inneresting, which has lots of links to things about writing. The one this past week was really good. It’s about oases and the moments in a story where characters find a bit of respite and escape from the plot and how important those are in stories. Inneresting.

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Craig: Yay.

John: Yay.

Craig: Yay.

John: Craig, it’s so nice to have you back.

Craig: Great to be back, John.

John: Thanks.

[Bonus Segment]

John: Craig, capitalism.

Craig: What?

John: What?

Craig: Huh?

John: It is the water we are swimming in. It is the system of finance and economics that we’ve grown up in. At the same time, when I see people complain about things in the world or about technology or about AI or other things, I’m like, yeah, but that is actually just capitalism you’re concerned about. That’s just how things are. Craig, I’m curious, when were you aware of capitalism?

Craig: Early age. Social studies class. You learn about different forms of economy. Certainly, we learned about the alternatives. In the ’80s, there wasn’t a lot of discussion of capitalism as a problem.

John: Yeah, because we had capitalism versus Communists. It was us versus the Russians.

Craig: There was the middle ground of socialism. But I think there was also a less angry discussion over it. Deregulation began in earnest under Ronald Reagan in the ’80s. But prior to that, we had and still have things like Social Security, which has the world “social” in it, which people that hate socialism are really angry about if you say that you would take it away. We have Medicare, and we have Medicaid, and we have Workman’s Comp, and we have Disability, and we have taxes. The thing is, we do live in a socialist system. I don’t know how you can’t, other than some sort of Ayn Rand fantasy-ville.

Capitalism was never seen as some sort of pure thing, but rather it was a negotiating thing. Tying back to what we were talking about earlier with Edison, one of the things we learned about quite a bit was how capitalism unchecked became a real problem around the turn of the century in the United States, the turn of the 20th century, and Sinclair Lewis and child labor, the meatpacking industry, the Triangle Shirtwaist Factory fire, labor movement, and all that leading into the busting of monopolies, robber barons, etc. There was a time when in our country, capitalism got out of hand, and the government stepped in and put it in check, and it hasn’t done so again effectively since.

Where I’m sitting here, I agree with you. When people are complaining, what they are complaining about is capitalism. But from my point of view, I would say what they’re really, really, really complaining about is the dysregulated capitalism.

John: We were alive during the time of Reagan and, “We’re going to take away all these rules about stuff that are holding us back.” And it’s hard to remember that there was a time before then, when there were more controls over what people could do, what companies could do and the size and scale of what they’re able to do.

I remember my dad worked for AT&T, or Bell Labs, and when the phone monopoly got broken up, I was like, “Oh my god, what are they doing? That’s crazy.” But it was the right choice, in retrospect. It was a dumb system we were living in. The innovation that was possible afterwards was important.

Let’s talk for a moment about definitions of what capitalism is, because there’s things that are in capitalism that are also common in other systems too. But important distinctions: the idea of a competitive market, that you want to have multiple companies competing for buyers, and buyers can choose between places they want to buy from; the sense of price finding, that there’s not a set price, but the price will find its right balance based on supply and demand; the idea of private property, property rights recognition, which includes patents and trademarks and copyright; the idea of wage labor, which seems so basic, but obviously in a lot of other economic systems, you don’t get paid wages for things.

You could argue, was America set up under a capitalism system? Kind of. The term wasn’t really used. But we also had slavery, so you can’t say that we were under any true wage system.

Craig: We certainly were not.

John: No. It’s complicated, but I think we have this fundamental belief and understanding that America has always been this capitalist nation. It’s like, not really.

Craig: No, we were more akin to a feudal nation. I think our economy was somewhat feudal. Obviously, there were two economies in the early United States. But one economy was victorious in the end, and that was industry. The growth of industry and the Industrial Revolution created what we consider capitalism today, I do believe. That was also what Marx was reacting to, and Hegel and the rest of them.

What industry did was create a both tremendous energy of creation and freedom and wealth, and also terrible exploitation and destruction. On one hand, industry – which we have in our brains converted into technology, but if we lived in China, we would understand is also industry, where everything is manufactured still – has led to longer lives, has led to tremendous advances in technology that liberates and connects. The creation of simple things like washing machines was essential to the liberation of women, who were traditionally stuck washing clothes literally all day.

But without regulation, almost every single time, what ends up happening is terrible pollution, the abuse of children, the underpayment of labor, extremist slavery, and then monopolization, which undoes what you call price seeking and freedom and actually begins to destroy creativity, and it kills itself. Capitalism is like bacteria that works well in our body until it runs rampant and then it can kill us.

John: A term I hear used a lot is late-stage capitalism. I wasn’t even quite clear what people are trying to refer to with it. It’s basically this moment that we’re in right now that has not just giant corporations, but multinational corporations, where you can’t even point to a center of them. They’re harder to control and regulate because they exist beyond national boundaries.

A thing that we’re both agreeing on here is that capitalism relies on a government system to enforce contracts and do certain things, and yet as individuals, we rely on the government to protect us from the worst abuses that these companies are going to enforce upon us. That is a real challenge when companies exist beyond all conceivable boundaries. It requires multinational government agreement on how to deal with these corporations. That’s not a thing that we really have a good structure for at this moment.

Craig: No. The closest we have is the United States government, which is being held hostage by one political party that at this point seems to only have, “We don’t like government,” as a purpose. And then there is the European economic community, which does represent itself fairly well as a large corporation of companies. It is in fact Europe that seems to be doing the only holding companies to accountability action. Now, they are not a particularly efficient group. Government is notorious for being inefficient. It’s why capitalism is also necessary. If government is in charge of creation, production, and payment, in general, you end up with a bureaucratic sludge.

Capitalism, to me, is really just the expression of human nature in economic form. But just like human nature, we need law. What we do see is Europe, representing a very large market, can say to, for instance, Google or Amazon, “No, you can’t do that anymore. We don’t like that anymore. Stop it.” The United States used to do that. It’s been quite some time, and these companies seem to be just flouting all of the rules. But the United States still represents an enormous marketplace. If the United States, for instance, said to Amazon or Netflix, “You can’t do these things anymore,” then it would have to stop.

That said, some of the things that Europe has done, particularly vis a vis technology to try and curb late-stage capitalistic companies, just is ineffectual nuisance. For instance, the constant asking me if I want to accept the cookies. Okay. Sure.

John: Yeah, or like, you must use USB-C. Sure, great. There’s the concern that they will tend to favor European companies over American companies. Yeah, we get all that. I think what it comes down to is – I say people’s complaints are really about capitalism. The second part of that answer is, and the solutions to these things are demanding of your government to address these concerns, because you’re not going to be able to address these concerns. You can’t yell at the corporation to do better. You actually have to – it requires action to make any of these changes.

Craig: Yes. Corporations, by charter, are designed to maximize profits for their shareholders. That is their sole purpose. What that means is that if they could get away with paying their workers five cents an hour, including hiring children, they would, because that satisfies their charter, to maximize profits. That’s where we need regulation.

The people that are angry about capitalism probably, almost certainly, are reasonably angry, because they’re probably being underpaid. Most people are. Wages have not progressed as they should. And if the United States government were functional and mandated a healthy minimum wage, I think people would be complaining less, because that’s a huge problem. They don’t get paid enough.

Also, companies – particularly, the financial industry has become so complicated and so disconnected from creation that this concept of too big to fail is real. We’re now on the system where capitalism – some companies simply cannot lose. If they lose, society falls apart, because they’re too integrated into our backbone. That’s a huge problem.

John: I think a previous One Cool Thing on an earlier episode was a book I was reading on the history of corporations. Corporations have existed before capitalism. They were originally designed to do sailing expeditions to different places, basically how you’d raise enough money to do a thing. Importantly, corporations had to get a charter that was literally from the royals. The imperial state had to give them the charter.

The argument is basically that government should basically have that same kind of charter thing, saying you actually have to serve the public in what your corporation does. There has to be a purpose beyond just making money. That’s an idea that we’ve completely lost. That seems insane, but that was the idea.

Craig: That was the idea. Just as certain concepts like copyright have become abused or weaponized, so too has the notion of corporatism and the idea that corporation now begins to shield all human beings from accountability. The creation of corporations is something that, at least in the state of Delaware, appears to be a hand wave. You and I both made corporations for ourselves, loan-out corporations.

John: Scriptnotes is an LLC.

Craig: There you go. Those corporations required a whole lot of one page of paperwork.

John: Yes, indeed.

Craig: They exist to take advantage of certain business things and certain tax things, so the tax code, all of it. Think about that, that the tax code – that’s the oxygen that government breathes to live – is in and of itself interwoven into corporate creation and corporate function. The economists argue with each other constantly over how this all works. I suppose if we step back really, really far and boil it down to its simplest, simplest version, it’s that there needs to be a balance, and we are out of balance.

John: We’re out of balance. We’re simplifying, yet it’s actually accurate, because we recognize that all the good things about capitalism and corporations, in terms of price finding and all that stuff, there is an efficiency there that you cannot replace. But without the acknowledgement of the individual value of people and societies and the environment, you’re going to end up in a terrible, dark place.

Craig: If you only value profit, you will die. You have to also value things that will diminish profit, like the health and welfare of human beings, because in the end, that’s what the economy is for. What our economy has turned into is an economy that exists to hyper-enrich an incredibly small amount of people. It’s just not going to work. We’ve been here before. I think the richest person ever in terms of dollars out of the amount of dollars that existed on the planet was Rockefeller perhaps or maybe Getty.

John: Perhaps, yeah.

Craig: The original oil barons, the robber barons. That’s why it changed. There was that period in the earlier part of the 20th century where America corrected what had been an out-of-control corporatization in our country. We are so clearly in need of that now.

Part of what we struggle with is that all of the messaging and discussion and the politics and the way politics functions as – these campaigns are corporations – the corporations themselves are sitting there, including the ones you and I work for, guiding the discussion. The people who want to not return balance to the system are the ones that have their finger on the play button.

John: At least we’ve solved it. That’s the good news. We talked it through. We figured it out. So problems resolved.

Craig: Problem solved. There’s something counterfactual where Rupert Murdoch isn’t born or decides to learn guitar and be in a band, a lovely band in Australia.

John: Or he has some sort of Christmas Carol kind of visiting by three ghosts, and things turn out very differently.

Craig: Where are the ghosts when you need them?

John: That’s the question. Never the ghosts when you want one. Craig, Drew, thanks so much.

Craig: Thanks, guys.

Links:

• What If? by Robert Cowley
• Thomas Edison: The Unintentional Founder of Hollywood by Garrett O’Brien for the Saturday Evening Post
• United States v. Paramount Pictures, Inc. on Wikipedia
• George Lucas: The Car Wreck That Changed His Life and Led Him to ‘Star Wars’ by Tim Ott for Biography
• When ‘Titanic’ Was Expected to Be a Huge Flop by Jake Rossen for Mental Floss
• ‘John Carter’ Changed Hollywood, but Not in the Way Disney Hoped by Richard Newby for THR
• Financial Interest and Syndication Rules
• Post-Quantum Cryptography
• S’more! S’more! His artisanal marshmallows were the greatest. Then he tried to scale them. by Adam Rogers
• Get a Scriptnotes T-shirt!
• Check out the Inneresting Newsletter
• Gift a Scriptnotes Subscription or treat yourself to a premium subscription!
• Craig Mazin on Threads and Instagram
• John August on Threads, Instagram and Twitter
• John on Mastodon
• Outro by Zach Lo (send us yours!)
• Scriptnotes is produced by Drew Marquardt and edited by Matthew Chilelli.

Email us at ask@johnaugust.com

You can download the episode here.