US Rail Strike

Nearly 115,000 U.S. rail workers are poised to go on strike on Thursday at midnight, shutting down 40% of long-distance trade, after negotiations between rail unions and carriers failed to bear fruit. If a deal is not reached by Friday, a strike will begin, shutting down freight rails across the U.S.

While the leaders of 10 of the 12 unions have accepted the outline laid out by the PEB, the two largest, which make up roughly half of rail workers in the U.S., have not. In addition, the 10 who have accepted it have not put a vote to the rank-and-file members of the union, which is required before it is accepted.

Media reports said:

While the end of the “cooling off” period does not guarantee a strike, two of the 12 rail workers’ unions have yet to reach a deal with the industry’s bargaining committee, and the other 10 have vowed to walk off the job if even one union is left without a contract.

A strike would cost the U.S. economy as much as $2 billion per day, according to the Association of American Railroads (AAR).

The U.S. Chamber of Commerce is warning of a “national economic disaster,” while industry figures warn the impact of a strike would double each day if continued.

The U.S. economy is already strained by supply chain disruptions stemming from the Covid-19 shutdowns, record high inflation, and sky-high energy costs.

U.S. President Joe Biden is reportedly working with “other modes of transportation” to try to pick up the slack, but the trucking industry was already short 80,000 drivers before the strike, and the AAR’s analysis found an additional 467,000 long-haul trucks would be required to move the stalled freight.

A Presidential Emergency Board appointed in July has recommended a 14% wage increase for workers and stronger benefits, but the unions say they would not accept any proposal that does not change the “brutal” attendance policies that currently force them to be “on call” 90% of the time.

“If this contract is presented to our members in its current form, it will not pass,” a union spokesperson told CNBC on Monday.

The spokesperson said: “The workers are angry. They want movement on attendance policies and not be afraid to take a sick day or vacation day without the fear of termination.”

Railroads insist the system is necessary to ensure sufficient manpower to operate and claim to have been hiring aggressively to ease the strain, but the U.S. Surface Transportation Board reported major carriers have cut their ranks by 29% over the past six years.

Carriers are already preparing for the strike, securing hazardous materials and other sensitive cargo. Passenger operator Amtrak has canceled all long-distance routes starting Thursday in preparation for the strike. While its own employees are not part of the unions involved, 97% of its service operates on freight lines serviced by the striking unions.

Rail workers last went on strike in 1992. The walkout lasted two days before Congress intervened, a possibility the Biden administration is likely hoping to avoid in a midterm election year in which his party needs union support.

Sanders Blocks Resolution That Would Have Forced Rail Workers to Accept Deal

On Wednesday, Senator Bernie Sanders prevented the quick passage of a Republican-led resolution that would have forced rail workers back to work before a strike that is set to begin on Friday if unions and rail industry companies cannot come to an agreement before then.

The resolution was proposed by Republican Senators Roger Wicker of Mississippi and Richard Burr of North Carolina. It would require workers, who have been negotiating for better working conditions for three years, to accept the outline laid out by the Presidential Emergency Board (PEB) formed by President Biden in August.

While the workers and rail companies have agreed to compensation levels, the key sticking points that remain are the lack of sick days, paid or unpaid, and a grueling on-call schedule that requires rail workers to be on-call for 12 hours a day for 14 straight days and be ready to get to the job at a moment’s notice. Workers are demanding 15 paid sick days a year and a more reasonable on-call schedule.

The proposal includes a pay increase of 24%, an annual bonus of $1,000 and one additional day of paid leave, but does not include any sick days.

Sanders blocked the resolution, arguing that the rail companies are reaping billions in profits while forcing their workers to endure horrible working conditions.

“The rail industry has seen huge profits in recent years and last year alone made a record breaking $20 billion in profit,” Sanders said on the Senate floor. “The CEOs of many of these rail companies are enjoying huge compensation packages. For example, last year the CEO of CSX made over $20 million in total compensation, while the CEOs of Union Pacific and Norfolk Southern made over $14 million each in total compensation. In other words, what is happening in the rail industry is what is happening all over this country. Corporate profits are soaring and CEOs are making incredibly large compensation packages.”

The Vermont senator would later mention that “the rail industry spent over $18 billion, not to improve rail safety, not to address the supply chain crisis in America, but to buy back its own stock and hand out huge dividends to its wealthy stockholders. In fact, since 2010, the rail industry has spent over $183 billion on stock buybacks and dividends.”

Sanders then went on to compare the conditions of rail workers to that of employees at the Department of Transportation.

“If you are an employee at the Department of Transportation in the United States, sitting behind a desk, you are appropriately, I believe this very much, guaranteed 12 weeks of paid family and medical leave. But if you are an engineer, running a train with tons of freight behind you, a very dangerous job, you get zero sick leave. Now, that may make sense to someone, but it does not make sense to me.”

He also noted that providing rail workers with 15 days of sick pay would cost an estimated $688 million a year, which is less than 3.5% of the profit made by the industry.

The unions could be forced to accept the deal because of a 1926 law that governs how and when rail workers can strike.

Republican Senator Minority leader Mitch McConnell called out the Democrats for blocking the Burr-Wicker resolution, saying it would have “prevented a crippling strike and supply chain crisis.”

However, on the Senate floor, Sanders, who is independent, said it was time for Congress to stand with the American worker.

“It is time for Congress to stand on the side of workers for a change, and not the heads of large multinational corporations. Rail workers have a right to strike for reliable schedules, they have a right to strike for paid sick days, they have a right to strike for safe worker conditions, rail workers have a right to strike for decent benefits. The Burr-Wicker resolution would take these fundamental rights away from workers. We cannot allow that to happen.”

Long-distance passenger trains and grain shipments to be stopped, as rail strike looms

Washington Post reported:

U.S. Labor Secretary Marty Walsh convenes negotiators in Washington to head off strike that could devastate nation’s transportation capacity

The threat of a rail strike on Friday has already begun rippling through the U.S. economy, as farmers, businesses and commuters start to feel the impact of a potential transit shutdown even before it happens.

While top negotiators huddled in Washington late Wednesday to try to hammer out an agreement, industry groups increasingly warned of severe disruptions to America’s already fragile supply chains. Scheduled shipments of ammonia, fertilizer and other chemicals for agriculture are being pulled this week, because those products cannot be stranded in transit should negotiations fail, farm groups said. Ethanol prices moved markedly higher this week on the threat of a strike, according to S&P Global. U.S. railroads are also prepared to stop shipping crops as soon as Thursday, the Consumer Brands Association reported.

On the passenger rail side, Amtrak is canceling all long-distance trains starting Thursday, although most trains in the Northeast would not be affected, Amtrak said.

The emerging economic impact is putting enormous new strain on leaders on Capitol Hill and in the White House who are trying to end the standoff between rail carriers and workers. Labor Secretary Marty Walsh hosted emergency meetings with the rail carriers and unions on Wednesday at the department’s D.C. offices, but no sign of a deal has emerged. As of 6 p.m. Eastern, negotiators had been in closed-door talks for nine hours and had ordered in Italian for dinner.

The report said:

Republican leaders in Congress pushed legislation Wednesday to force the labor unions and management to accept the contract recommendations of a presidential board. Democrats rejected that proposal.

Hopes for quick resolution were further clouded Wednesday by one local chapter’s rejection of the deal brokered by their leadership. A chapter of the International Association of Machinists authorized a strike to take place later in September, hinting at broader rancor among union workers about the agreements being forced between union leadership and management.

There also was some forward momentum on Wednesday, as the members of two unions representing railway car inspectors and clerical workers became the first to vote to ratify their contracts negotiated by the president’s appointed board.

Negotiators face a deadline of 12:01 a.m. Eastern on Friday to avert the freight shutdown. Tens of thousands of workers would be part of a strike, if authorized.

Labor leaders have said they think the rail carriers are prematurely ceasing operations as a tactic to increase pressure on negotiators to reach a deal.

“If rail shuts down, our entire agricultural system shuts down,” Sen. Deb Fischer (R-Neb.) said in a speech on the Senate floor, emphasizing that her state’s farmers were counting on the upcoming harvest season. “The stakes of these rail negotiations could not be higher.”

Biden aides have sought to resolve the conflict between the rail carriers and unions to avert the possibility of one of the most disruptive strikes in recent U.S. history. The stakes are high for the Biden administration, which is desperate to ensure that America’s trains keep running but does not want to undermine the demands of union workers.

The administration has already faced criticism over its handling of the nation’s transportation infrastructure, which was racked last year by supply chain snarls and this year by a spike in cancellations and delays at the nation’s airports. Some administration officials fear squandering the Biden economic victories of August that have helped boost Democrats’ poll numbers.

Walsh, Transportation Secretary Pete Buttigieg and Agriculture Secretary Tom Vilsack have been in frequent communication with both sides of the negotiations, and Biden has personally called the unions and carriers to urge a deal.

The remaining issues include points-based attendance policies for conductors and engineers that penalize them for going to routine doctor visits or responding to family medical emergencies. The two largest railway unions have said their members would not ratify a contract that ignores this issue, and so far the railroads have not made any moves on the matter. It is unclear how Walsh or the administration plans to break the impasse.

The increasing desperation started new fights in Congress to resolve the matter. Sens. Roger Wicker (R-Miss.) and Richard Burr (R-N.C.) on Wednesday afternoon attempted to advance legislation to force both sides to accept the contract recommendations made last month by a nonpartisan panel appointed by the president. The unions have rejected those recommendations because they do not address workers’ fury over company penalties for missing time because of illness or family emergencies.

Sen. Bernie Sanders (I-Vt.) on Wednesday blocked the GOP attempt to pass the measure via “unanimous consent,” which requires the support of all 100 senators.

The Washington Post report added:

Democratic lawmakers have largely left it to the Biden administration to reach a deal, and it’s not clear whether they would support the GOP’s legislation, against the wishes of labor unions, should the impasse reach that point.

The congressional jockeying comes as a new poll suggests that most workers in one of the biggest railroad unions are prepared to reject the deal under consideration. The poll by SMART-TED found that 78 percent of workers would reject the proposed settlement.

“I know for sure with covid out there nobody is even testing themselves because they don’t want to lose points,” said Jordan Boone, 41, a BNSF conductor in Galesburg, Ill., and member of SMART-TED. “I have five kids, and I’ve always missed the kids’ soccer and baseball games and cheerleading, but the new attendance policies make it impossible to go to anything.”

Democrats are highly unlikely to approve legislation mandating that workers accept the contract recommendations without changes to time-off policy, said Larry Cohen, a labor leader and former president of the Communications Workers of America.

“Democrats are not going to impose these contracts without dealing with the issue of workers’ working lives,” Cohen said. “Republicans are viciously against collective bargaining, but carriers are going to have to respect people’s lives and there is going to have to be respect for these workers. They are not getting a settlement without it.”

Still, political pressure is mounting on Democrats to agree to end the standoff. White House aides have in recent days examined the potentially drastic impact on the nation’s drinking water and energy supplies that could come from a shutdown.

“If it is a day or two, it may not be that big a deal. If this went on for a week or two weeks, you would see shortages of all sorts of things,” said Dean Baker, a White House ally and co-founder of the Center for Economic and Policy Research, a left-leaning think tank. “You are going to have erratic shortfalls.”

He said of the White House: “They are trying hard to do this but it is really hard to do on the fly. It is not like they have been planning this for years.”


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