Biden Asks Congress to Avert Rail Strike, Warning of Dire Economic Impact

Washington — 

U.S. President Joe Biden on Monday called on Congress to intervene to avert a potential rail strike that could occur as early as December 9, warning of a catastrophic economic impact if railroad service ground to a halt.

Biden asked lawmakers to adopt the tentative deal announced in September “without any modifications or delay – to avert a potentially crippling national rail shutdown” and added that up to 765,000 Americans “could be put out of work in the first two weeks alone.”

House Speaker Nancy Pelosi said lawmakers would take up legislation this week “to prevent a catastrophic nationwide rail strike, which would grind our economy to a halt.”

On Monday, more than 400 groups called on Congress to intervene in the railroad labor standoff that threatens to idle shipments of food and fuel and strand travelers while inflicting billions of dollars of economic damage.

A rail traffic stoppage could freeze almost 30% of U.S. cargo shipments by weight, stoke inflation and cost the American economy as much as $2 billion per day by unleashing a cascade of transport woes affecting U.S. energy, agriculture, manufacturing, health care and retail sectors.

“A rail shutdown would devastate our economy,” Biden said. “Without freight rail, many U.S. industries would shut down … Communities could lose access to chemicals necessary to ensure clean drinking water. Farms and ranches across the country could be unable to feed their livestock.”

Biden hailed the contract deal that includes a 24% compounded wage increase over a five-year period from 2020 through 2024 and five annual $1,000 lump-sum payments.

Workers in four unions have rejected the tentative deal, while workers in eight unions have approved it.

Labor Secretary Marty Walsh, Transportation Secretary Pete Buttigieg and Agriculture Secretary Tom Vilsack have been involved in discussions with the rail industry, unions and agriculture industry stakeholders.

Senator Roger Wicker, the top Republican on the Commerce Committee, praised Biden’s call to Congress to act and said no one side was fully happy with the compromise contract deal “but the responsible thing to do is avoid the strike.”

The Association of American Railroads said “congressional action to prevent a work stoppage in this manner is appropriate … No one benefits from a rail work stoppage – not our customers, not rail employees and not the American economy.”

In a letter on Monday, the U.S. Chamber of Commerce, National Association of Manufacturers, National Retail Federation, American Petroleum Institute, National Restaurant Association, American Trucking Associations and other groups warned that impacts of a potential strike could be felt as soon as December 5.

Biden said Congress “should set aside politics and partisan division and deliver for the American people. Congress should get this bill to my desk well in advance of December 9th so we can avoid disruption.”

“The risks to our nation’s economy and communities simply make a national rail strike unacceptable,” says the letter to congressional leaders first reported by Reuters, warning a strike could halt passenger railroad Amtrak and commuter rail services that “would disrupt up to 7 million travelers a day.”

Biden’s Presidential Emergency Board in August released the framework for the tentative deal forged in September between major railroads and a dozen unions representing 115,000 workers. Those carriers include Union Pacific, Berkshire Hathaway Inc.’s BNSF, CSX, Norfolk Southern and Kansas City Southern.

Unions and railroads have until December 9 to resolve differences. If they do not, workers could strike or railroads could lock out employees — unless Congress intervenes. But railroads would halt hazardous materials shipments at least four days ahead of a strike deadline.