One of the 10 labor groups that had reached a tentative deal with the United States’ rail companies to prevent a system-wide strike has now rejected the offer.
The International Association of Machinists and Aerospace Workers announced on Wednesday that its 4,900 members had voted to reject a deal its leaders reached with the U.S. freight railroads in an effort to keep the system running. It is now extending its negotiation process to September 29.
‘IAM freight rail members are skilled professionals who have worked in difficult conditions through a pandemic to make sure essential products get to their destinations,’ the union said in a statement. ‘We look forward to continuing that vital work with a fair contract that ensures our members and their families are treated with the respect they deserve for keeping America’s goods and resources moving through the pandemic.
‘The IAM is grateful for the support of those working toward a solution as our members and freight rail workers seek equitable agreements.’
Meanwhile, two other unions, representing 60,000 engineers and conductors, that are set to go on strike Friday as the Biden administration scrambles to reach a deal in a desperate attempt to prevent economic turmoil leading up to the midterm elections.
The conductors’ and engineers’ unions remained in negotiations with the nation’s railroad management companies on Wednesday as they demand more quality-of-life provisions be put into their contracts for the coming year, covering attendance policies, vacation, and sick days.
They say working conditions and scheduling issues are driving their members to quit in droves, leaving the railroads with a staffing shortage that those who are left have to fill.
The unions have already reduced what they are asking for, including eliminating their demand for paid sick days, according to the Washington Post, and say that if their demands are not met by Friday, they will strike to improve employees’ quality of life.
Doing so, though, would cost the United States an estimated $2 billion a day, worsen an ongoing automobile shortage, cause system-wide commuter delays and send inflation soaring despite the president’s efforts over the past few months to tamper down on historically-high prices.
Among the effects to the average American would be increased food and gas prices and higher prices on goods ahead of the holiday season — as nearly 30 percent of the nation’s goods are transported by rail.
The International Association of Machinists and Aerospace Workers announced on Wednesday that its 4,900 members voted to reject a deal its leaders reached with freight railroad companies
Two other unions, representing 60,000 engineers and conductors, that are set to go on strike Friday as the Biden administration scrambles to reach a deal in a desperate attempt to prevent economic turmoil leading up to the midterm elections
Experts say that a strike would hamper the country’s already entangled supply chain and send inflation soaring once again.
Oil refineries would have trouble producing their current volumes of gas without the freight railroads, CNN reports, and would prevent recently harvested crops from moving to food processors, as well as disrupting the supply of fertilizer to grow new crops.
Additionally, according to the National Retail Federation, any rail strike could have long-lasting negative effects on the import of goods for the holiday season, causing shortages and higher prices.
And a potential rail strike would choke off supplies of already scarce computer chips and other car parts, cutting off the delivery to auto assembly plants, which could force temporary shutdowns at some of America’s auto plants.
It would also disrupt the flow of completed new cars and trucks to dealers throughout the country, 75 percent of which move by rail.
In total, the Association of American Railroads has estimated that a rail strike could cost the United States an estimated $2 billion per day in economic output — a figure that has also been cited within the Department of Transportation.
‘The cost will grow geometrically the longer the strike lasts,’ said Patrick Anderson, of Anderson Economic Group. ‘After a week, you’d see real damage in the US economy.’
‘If we reach a week-long strike, we’re in uncharted territory,’ he added.
Experts say a freight trains strike would prevent recently harvested crops from moving to food processors, as well as disrupting the supply of fertilizer to grow new crops
It would also send gas prices soaring as oil refineries would have trouble producing their current volumes of gas
The potential strike comes as the United States’ economy is just starting to rebound from record-high inflation.
The Commerce Department’s latest consumer price index report, released on Tuesday, shows that inflation in the United States dipped again in August to an 8.3 percent annual rate — representing a drop from the 40-year high of 9.1 percent recorded in June and 8.5 percent in July.
On a monthly basis, consumer prices rose 0.1 percent in August, after remaining flat in July. Those are the figures the Federal Reserve, which is charged with fighting inflation, monitors most closely.
Falling gas prices led the retreat in August’s inflation figures, with gasoline dropping 10.6 percent on the month, though pump prices remained about 25 percent higher than they were a year ago.
‘Today’s data show more progress in bringing global inflation down in the US economy,’ Biden said in a statement following Tuesday’s report.
‘Overall, prices have been essentially flat in our country these last two months: that is welcome news for American families, with more work still to do,’ he added, referring to month-to-month changes in the index, which have been tamed by declining gas prices.
Still, the latest numbers were hotter than expected, and Wall Street dropped sharply in reaction.
The Dow dropped more than 1,000 points on Tuesday afternoon and the S&P 500 sank 3.9 percent, while the tech-heavy Nasdaq Composite lost 4.7 percent.
Food prices also continued to rise at a blistering rate, with the cost of groceries up 13.5 percent from last year, the biggest annual increase seen since February 1979.
And housing costs continued their upward march, with rent up 6.7 percent in the past 12 months.
Now, the self-proclaimed ‘pro-union’ president is scrambling to get the workers to reach an agreement with the freight companies in an effort to prevent potential economic turmoil ahead of the midterm elections as he meets with union leaders across the country.
He has already tried to block a strike through executive action back in July — but that only delayed the possibility of a strike for 60 days.
He also appointed a Presidential Emergency Board, which came up with recommendations for a deal that has been accepted by most of the unions.
So far, nine of 12 of the nation’s railroad unions have reached tentative deals with the railroads that will see them earn 24 percent raises over five years, $5,000 in bonuses and one extra vacation day a year.
That deal, though, did not satisfy the two holdouts – The Brotherhood of Locomotive Engineers and Trainmen and the SMART Transportation Division, who say they are not interested in raises but rather safer working conditions.
The heads of those unions were set to meet with Labor Secretary Martin Walsh in Washington early on Wednesday, and the president personally called rail unions and companies on Monday in an attempt to avert a shut-down, White House Press Secretary Karine Jean-Pierre told reporters.
‘The White House is working with other modes of transportation (including shippers, truckers, air freight) to see how they can step in and keep goods moving, in case of a rail shutdown,’ an unnamed White House official told CNN.
President Joe Biden is scrambling to get the workers to reach an agreement with the freight companies in an effort to prevent potential economic turmoil ahead of the midterm elections. He is pictured here boarding Air Force One on Wednesday
But the American Trucking Association has issued a statement saying it would require more than 460,000 additional long-haul trucks every day to meet the demand left by the freight trains, which, it says is ‘not possible based on equipment availability and an existing shortage of 80,000 drivers.’
It instead called on Congress to act to keep railroad workers on the job, saying that the trucking industry depends on sharing shipments with the railroads.
Congressional Republicans have since said they are planning to introduce legislation that would impose a contract on the engineers’ and conductors’ unions that would force them to stay on the job.
‘A rail worker strike would be catastrophic for America’s transportation system and our already-stressed supply chain,’ said Sen. Richard Burr, a North Carolina Republican who plans to introduce the bill with Sen. Roger Wicker, of Mississippi.
He said the PEB recommendations, which form the basis of the contract his legislation would impose ‘are a fair and appropriate solution to a years-long negotiation process, but labor unions are continuing to hold the entire nation’s rail system hostage as they demand more.’
Amtrak has already announced that it would be canceling trips on several of its routes in preparation for the strike
In the meantime, Amtrak officials have already announced it would be canceling trips on several of its routes in preparation for the unprecedented strike.
As of Tuesday, the passenger rail agency suspended service on three cross-country routes out of Chicago, going to San Francisco, the Pacific Northwest, and Los Angeles, Amtrak said in a statement Monday evening.
Service would also be disrupted for a route along a portion of one of those routes, the company said – between Los Angeles and San Antonio.
Calling the changes ‘initial adjustments’ made ‘in preparation for a possible freight rail service interruption’ later in the week, the move from the passenger rail comes as many of America’s railroads have already stopped accepting shipments of hazardous and other security-sensitive materials due to the looming threat of a strike.
While the company is not among those in contract negotiations, nearly all of the passenger service’s routes outside the Northeast run on tracks owned by freight railroads — meaning that a walkout could disrupt passenger service.
‘These adjustments are necessary to ensure trains can reach their terminals prior to freight railroad service interruption if a resolution in negotiations is not reached,’ Amtrak officials said in their statement.
It added that a walkout would ‘significantly impact’ the more than 21,000 route miles it operates outside the Northeast.
The affects, however, would likely be more minimal in the northeast, the company says, with a ‘small number’ of its Northeast Regional departures would see service interruptions if a strike were to transpire.
The passenger rail’s preemptive maneuver echoes those of several America’s most notable freight railroads in recent weeks, such as Union Pacific, which has already stopped accepting shipments of hazardous and other security-sensitive materials in anticipation of the looming threat.
Pacific, one of several major national railroads whose operations would be halted by the potential pause, said the move is meant to ‘protect employees, customers, and the communities we serve.’
A statement from the railroad’s trade group said they were taking the unprecedented to ‘ensure that no such cargo is left on an unattended or unsecured train’ during the potential unrest, in accordance with federal guidelines.