I'm much more anti-union than the average joe, but Hollywood is one example where it kind of makes sense, disregarding the international competition angle for a sec: it is a highly specialised kind of work, sometimes dangerous, with a very limited number of employers that are operating in a cartel-like environment that is known to be financially (and sometimes also sexually and ethnically) ruthless and opportunistic. The negotiating power is very uneven.

Considering that even in a big and highly competitive environment such as Silicon Valley they managed to establish illegal hiring cartels between the big companies (Apple etc), I'd be sceptical to dish out free market arguments.

Hollywood is not loosing relevance due to inflated wages, they stopped making movies people want to see. The reason for that is quite obvious, but a totally different discussion.