National rail strike could throw holiday shopping off the rails

WASHINGTON (Gray DC) - President Joe Biden is calling for Congress to step in as nationwide rail workers are threatening to go on strike December 9.

On Monday, the President asked Congress to pass legislation to adopt the tentative agreement between the railroad workers and operators. Last week, eight rail unions ratified the agreement on pay, health, and benefits. Four rail unions rejected the agreement.

The President said, “as a proud pro-labor President, I’m reluctant to override the ratification procedures and views of those who voted against the agreement. But in this case – where the economic impact of a shutdown would hurt millions – I believe Congress must use its powers to adopt this deal.”

The Association of American Railroads estimates a strike could cost the nation up to $2 billion per day. It reports a strike would halt 7,000 long-distance Class I trains per day in addition to short-line, passenger and commuter trains.

The National Federation of Retailers (NFR) and other business groups fear the strike could also send holiday shopping off the rails. The NFR said in a statement, “millions of hardworking Americans rely on the freight rail system for their jobs and the economic security of our country. A nationwide rail strike during the peak holiday season will be devastating for American businesses, consumers and the U.S. economy.”

Meanwhile, on Tuesday the President is set to address the economy in Bay City, Michigan. Michigan is just one state that could be hit hard economically by a rail strike.

“What I can tell you is that our automotive, our agriculture and certainly our chemistry industries would be severely impacted by this, as well as would other supply chain modes of transportation like trucking,” said Michael Alaimo of Michigan’s Chamber of Commerce. “We are hearing that capacity for trucking is a little bit better than it was back in September. So, there’s that potential for companies to adjust and make the switch where they need to. But we’re seeing inflationary pressures that are derived from diesel prices only made worse by this situation.”

Alaimo said in Michigan his department is working to advocate for the business community and keep them up to date on the developing negotiations.

“For us, it’s about communicating with our Michigan congressional delegation to say, you know, please make this a priority. We are encouraged by hearing from some of our Congressional leaders that they do understand the realness of this situation. And, it sounds like there will be action taken, if negotiations aren’t fruitful. We certainly hope that they are. I don’t think anybody wants to see Congress or, you know, the work that the Biden administration has done to intervene directly. But, I think folks do generally recognized that this is kind of a too big to fail situation. And so, we need to do what it takes in order to keep this critical component of our supply chain up and running,” he said.

Alaimo said a strike could have long-term implications on the rail industry as a whole.

“Looking towards this December 9th cliff, if you were to call it that, you know, companies are going to have to plan accordingly, particularly chemical companies that are under federal regulations. These are critical materials or critical products that we need to make sure get where they need to go. Think water safety, think, you know, infrastructure components. You know, once that switch is made, it’s not clear whether, you know, a supplier would go back to the rail,” he said.

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