‘A railroad closure would devastate our economy’: Biden urges Congress to avert potential strike

OMAHA, Neb. — President Joe Biden on Monday called on Congress to step in and block a railroad strike before its deadline next month in stalled contract talks after business groups pushed for the stalled negotiations.

“Let me be clear: a rail shutdown would devastate our economy,” Biden said in a statement. “Without rail freight, many US industries would shut down.”

Congress has the power to impose contract terms on workers, but it’s not clear what lawmakers might include in that case. They could also force negotiations to continue into the new year.

Both unions and railroads have lobbied Congress as treaty negotiations continue. Four railroad unions, representing more than half of the 115,000 workers in the industry, have rejected the deals Biden brokered ahead of the original September strike deadline and are back at the table trying to hammer out new deals. Eight other unions have agreed to their five-year contracts with the railroads and are in the process of claiming back wages for their workers for the 24% pay rises backdated to 2020.

Biden said that as a “proudly pro-worker president,” he was reluctant to override the views of people who voted against the deal. “But in this case — where the economic impact of a shutdown would hurt millions of other working people and families — I think Congress needs to use its powers to adopt this deal.”

Biden’s comments came after a coalition of more than 400 business groups sent a letter to congressional leaders on Monday, urging them to jump into the deadlocked talks over fears a strike could have devastating effects, leaving many companies at risk could force closure if they could. not getting the rail supplies they need. S-Bahn and Amtrak would also be affected by a strike because many of them use rail freight tracks.

The business groups, led by the US Chamber of Commerce, the National Association of Manufacturers and the National Retail Federation, said even a short-term strike would have a huge impact and the economic pain would be felt before the December 9 strike deadline. They said the railroads would stop transporting hazardous chemicals, fertilizers and perishable goods up to a week in advance to prevent those products from being stranded somewhere on the tracks.

“A potential rail strike only adds to the headwinds the US economy is facing,” the companies wrote. “A rail standstill would immediately lead to delivery bottlenecks and higher prices. The suspension of Amtrak and S-Bahn service would disrupt up to 7 million travelers daily. Many businesses would see their sales halted in the middle of the critical holiday shopping season.”

A similar group of companies sent another letter to Biden last month urging him to play a more active role in resolving the contract dispute.

On Monday, the Association of American Railroads trade group commended Biden’s actions.

“Nobody benefits from a disruption in railroad work – not our customers, not railroad workers and not the American economy,” said Ian Jefferies, President and CEO of AAR. “Now is the right time for Congress to pass legislation to implement the agreements, which have already been ratified by eight of the 12 unions.”

Congressional leaders and the White House have said they are closely following treaty negotiations but have not indicated when they might act or what they will do. House Majority Leader Steny Hoyer, D-Md., said leaders are aware of the situation at the railroad talks and will be monitoring the talks in the coming days.

Rep. Brian Fitzpatrick, R-Pa., told Fox News Sunday that congressional intervention is a last resort, but lawmakers must be ready to act.

“Congress will not allow this strike. That’s for sure,” said Fitzpatrick, who helps lead a bipartisan group of 58 lawmakers. “It would be devastating for our economy. So we will come to a solution one way or another.”

“It could certainly end up in the bosom of Congress, which is why we’re heading to DC this week to meet with legislators from both parties on the Hill,” said Clark Ballew, a spokesman for the Brotherhood of Maintenance of Way’s staff division, which represents track maintenance workers. “We have directed our members to contact their federal lawmakers in the House and Senate for several weeks now.”

Unions have asked railroads to consider adding paid sick days to what they already offer to address some concerns about workers’ quality of life. But so far, the railroads, which include Union Pacific UNP, have -2.25%,
BRK.B by Berkshire Hathaway, -1.31% BNSF, Norfolk Southern NSC, -1.49%,
CSX Canadian Pacific’s CSX, -1.00% and CP, -1.26%, Kansas City Southern declined to factor in.

The railroads want any settlement to closely follow recommendations from a Biden-appointed special tribunal this summer, which called for the 24 percent pay rise and $5,000 in bonuses but workers’ concerns about demanding schedules are making it difficult to reach an agreement to meet, not cleared days off and other working conditions.