'Big Four' Congress Leaders Head to White House, Hoping to Prevent Devastating Rail Strike
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With America facing a looming railroad strike, President Biden met with the leading Democratic and Republican leaders from the House and Senate on Tuesday. He says a shutdown would "devastate" the economy.
In an attempt to avert a breakdown in the U.S. supply chain, Congress is moving forward with legislation that Biden requested to prevent the railroad unions from striking. The House will vote tomorrow morning on the bill.
It comes after negotiations between several railroad unions and the White House failed again. More money isn't the goal for these union railway employees. They're fighting for paid medical leave and more time to spend with family.
"I don't like going against the ability of unions to strike, but weighing the equities we must avoid a strike - jobs will be lost, even union jobs will be lost," Biden said.
The nation's first railroad strike in 30 years could arrive in early December, devastating the supply chain ahead of the holidays. But failure to strike a deal likely means more than just delayed holiday gifts. "If you think about what travels on rail, it actually becomes a national security issue," said Jim Nelles, a supply chain consultant.
From ethanol and natural gas to building materials, even the chemicals that purify your drinking water -- all travel by rail. It could come to a screeching halt if a deal is not reached.
"Sick pay is not something negotiated in the agreements and it's something we've been trying to negotiate for several years," said Union Division President Tony Cardwell. "So, when our guys call in sick for work, they have and will be disciplined for doing such."
Cardwell represents some 23,000 workers in one of three major unions looking for a new deal. They rejected a proposal from Labor Secretary Marty Walsh that would increase worker pay by 24% over the next five years, add one personal day, and put caps on healthcare costs.
"Sick leave amounts to one cent per dollar of profits. We're talking a small profit of money the carriers are unable to put forward," Cardwell said. "Keep in mind these are some of the most profitable companies in the country."
A September strike was averted after President Biden imposed a 60-day cooling-off period, pushing negotiations past the midterm elections.
"The only reason we're not in a worse situation is because of the recession right now. Our imports from China are down significantly and the ports are less busy," Nelles said.
At this point, Congress could prevent a work stoppage or lockout through the Railway Labor Act. It could impose a deal or force workers to go back to work under the terms of the contract they just rejected.
"I really believe they're going to have a strike. And once the government steps in and shuts down the strike, I believe that's going to cause a massive slowdown," Nelles said. "It's going to cost the economy about $3 billion per day, every day there's a strike or a slowdown."
Nelles also worries the problem could likely spill into the highway and longshoremen shipping unions.
"I believe there will be a domino effect," said Nelles. "I think if these other unions see the rail unions get a 24% pay increase, they're all going to want a 25% increase. You're seeing this in Europe right now. There's a ton of strikes with their trucks and rails, also with taxi drivers. You're going to see that here if there is a strike. Those unions will strike with them in solidarity."
The threat of a strike comes as several railroads are seeing record profits. Unions argue those profits come at the expense of labor workers. If all 12 unions don't agree to the terms of a new contract, a full strike could happen in early December.
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