Biden says tentative railroad labor deal reached, averting strike

A worker drives a railcar at a BNSF railroad crossing in Saginaw, Texas, Wednesday, Sept. 14, 2022. Business and government officials are bracing for a possible nationwide railroad strike later this week as as talks continue between the largest United States freight railroads and their unions. LM Otero/Associated Press

WASHINGTON — President Joe Biden said Thursday that an interim railroad labor deal has been reached, averting a potentially devastating strike ahead of the crucial midterm elections.

He said the tentative agreement “will keep our essential rail system running and avoid disrupting our economy”.

The Democratic president believes unions built the middle class, but he also knew a strike by railroad workers could have seriously damaged the national economy. That left him in the awkward position of espousing the virtues of organizing in Detroit, a mainstay of the labor movement, while members of his administration pulled out all the stops to keep talks in Washington between the railroads and unionized workers in hopes of avoiding a shutdown. .

But after a long night, the talks were successful, and Biden announced Thursday that the parties had reached an agreement in principle to avoid a shutdown that would go to union members for a vote. He hailed the deal in a statement for avoiding a shutdown and as a win for all parties.

“These railroad workers will enjoy better pay, better working conditions, and peace of mind about their health care costs: all hard-earned,” Biden said. “The deal is also a win for railroads who will be able to retain and recruit more workers for an industry that will continue to be part of the backbone of the American economy for decades to come.”

It seemed much more tenuous to the president a day earlier.

Ryan Buchalski, a member of United Auto Workers Local 598, introduced Biden at the Detroit auto show on Wednesday as “the most union- and worker-friendly president in American history” and someone who “kicks ass of the working class”. Buchalski recalled the crucial strikes by autoworkers in the 1930s.

In the speech that followed, Biden acknowledged that he wouldn’t be in the White House without the support of unions like the UAW and the International Brotherhood of Electrical Workers, saying autoworkers “m’ brought to the dance”.

But back in Washington, his administration officials at the Labor Department were conducting tense negotiations to prevent a strike — one of the most powerful sources of leverage unions have to bring about change and improve working conditions.

Without the agreement between the 12 unions, a shutdown could have started as early as Friday, which could halt food and fuel shipments at a cost of $2 billion a day.

Much more was at stake than sick leave and wage increases for 115,000 unionized railroad workers. The ramifications could extend to congressional control and the transportation network that spins factories, stocks store shelves, and assembles the United States as an economic powerhouse.

That’s why White House press secretary Karine Jean-Pierre, speaking aboard Air Force One on her flight to Detroit on Wednesday, said a strike by railroad workers was “an unacceptable outcome. for our economy and the American people.” Railway companies and their workers’ representatives “must stay at the table, negotiate in good faith to resolve outstanding issues and reach an agreement”, she said.

Biden faced the same sort of predicament as Theodore Roosevelt in 1902 with coal and Harry Truman in 1952 with steel – how do you balance the needs of labor and business by doing what is right? better for the nation? The railroads were so important during World War I that Woodrow Wilson temporarily nationalized the industry to keep goods moving and prevent strikes.

Inside the White House, aides see no contradiction between Biden’s dedication to unions and his desire to avoid a strike. Union activism has increased under Biden, as evidenced by a 56% increase in petitions for union representation with the National Labor Relations Board so far this fiscal year.

A person familiar with the situation, who spoke on condition of anonymity to discuss White House deliberations on the issue, said Biden’s mindset going into the debate was that he was the president of the whole country, not just organized labor.

As the economy is still recovering from the supply chain disruptions of the pandemic, the president’s goal is to keep all parties on hold so that a deal can be finalized. The person said the White House views a commitment to continue to bargain in good faith as the best way to avoid a shutdown while exercising the collective bargaining principles Biden holds dear.

Biden also knew a shutdown could worsen the momentum that has contributed to soaring inflation and created a political headache for the ruling party.

Eddie Vale, Democratic political consultant and former AFL-CIO communications aide, said the White House took the right approach at a perilous time.

“Nobody wants a railroad strike, not the companies, not the workers, not the White House,” he said. “Nobody wants it this close to the election.”

Vale added that the sticking point in the talks was “respect essentially — sick and bereavement leave,” issues Biden has supported in his speeches and with his policy proposals.

Sensing a political opportunity, Senate Republicans moved on Wednesday to pass legislation imposing contract terms on unions and railroads to avoid a shutdown. Democrats, who control both houses of Congress, blocked it.

“If a strike occurs and cripples food, fertilizer and energy deliveries across the country, it will be because the Democrats blocked this bill,” said Senate Minority Leader Mitch. McConnell, R-Ky.

The economic impact of a possible strike was not lost on members of the Business Roundtable, a Washington-based group that represents CEOs. It released its quarterly economic outlook on Wednesday.

“We’ve had a lot of headwinds from supply chain issues since the start of the pandemic and those issues would be geometrically magnified,” Group CEO Josh Bolten told reporters. “There are manufacturing plants all over the country that probably have to close. … There are essential products to keep our water clean.

The roundtable also held a board meeting on Wednesday. But Bolten said Lance Fritz, chairman of the board’s international committee and CEO of Union Pacific Railroad, would miss it “because he’s working hard to try to resolve the strike.”

Back at the Labor Department, negotiators ordered Italian food as talks dragged on Wednesday night and the White House announced the deal at 5:05 a.m. Thursday.

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