Article by Rick Walker, Vice President, TradeInsights, LCB/CCS

Railroad Strike Update: President Biden and 400 Trade Groups Ask Congress to Intervene

If you are like me, you are paying extremely close attention to the possibility of a railroad strike which could happen as early as December 9th with service disruptions occurring as early as December 5th. The looming strike is being discussed all over the news and I was heartened when I heard two Congressman over the weekend saying that Congress simply would not allow a strike to occur. The National Customs Brokers & Forwarders Association of America, Inc. of which we are a long-standing member, has joined more than 400 trade associations across the country calling on Congress to act. “A stoppage of rail service for any duration would be extremely damaging to American families and our economy, costing $2 billion per day” the trade associations, led by the U.S. Chamber of Commerce, warned the leadership of both the House and Senate in a letter on Monday.

President Biden has now called on Congress to intervene. “As a proud pro-labor President, I am reluctant to override the ratification procedures and the views of those who voted against the agreement,” Biden said in an official statement. “But in this case, where the economic impact of a shutdown would hurt millions of other working people and families, I believe Congress must use its powers to adopt this deal.”

In her own statement, House Speaker Nancy Pelosi said that while Congress is reluctant to bypass the standard ratification process, she said Congress must act to prevent economic instability. “Under the Commerce Clause of the Constitution, Congress has both the authority and the responsibility to prevent this outcome and ensure the uninterrupted operation of critical transportation services,” she said. After a meeting with Biden and other top congressional leaders, Speaker Nancy Pelosi, D-Calif., said Tuesday she is confident there will be enough votes to pass a resolution in the House. House members are expected to take up the resolution on Wednesday, November 30, 2022, as early as 9AM. Once passed, it then would head to the Senate, where both Majority Leader Chuck Schumer, D-N.Y., and Minority Leader Mitch McConnell, R-Ky., have said lawmakers need to intervene this week.

According to the National Carriers’ Conference Committee (NCCC), which represents the nation’s freight railroads in national collective bargaining, four of the 12 unions have rejected the master labor contract, setting up the possibility for a national rail strike on December 9th. An earlier strike by freight rail labor was anticipated on Sept. 16, but the U.S. Labor Department on Sept. 15 helped the rail companies and union negotiators reach a tentative agreement. However, the individual unions, which are represented by the National Railway Labor Conference, must all vote to ratify the agreement. If one union chooses to strike, no matter how small, all unions of the conference are obligated to participate. “Even a short-term rail strike would have enormous impacts,” the trade associations said. “The American agricultural community could see disruptions in transporting 6,300 carloads of goods and farm products that are carried by rail daily. It would also halt the delivery of key chemicals necessary to our communities including chlorine, which is necessary for effective water and wastewater treatment operations. In many cases, businesses and communities rely on regular rail service and may not have significant reserves even in the event of a short-term strike.”

V. Alexander & Co., Inc. will continue to monitor the situation and provide updates as warranted.