A last-minute deal between railway employees and management that prevented a strike that might have cost the American economy $2 billion per day was applauded by President Joe Biden on Thursday.
On Monday, Biden stepped in to mediate the labour issue, and Secretary of Labor Marty Walsh welcomed parties for protracted talks that ended with an agreement announced Thursday morning.
As he met with the negotiators in the Oval Office, Biden quipped, “It feels nice… they should be at home in bed.”
At a gathering where all parties could promote the agreement in front of the TV cameras, the president declared, “Twenty straight hours and I want to congratulate business and labour.”
Biden referred to the agreement as a “victory for tens of thousands of train employees and for their dignity” during his comments in the Rose Garden.
He described the agreement as a “success for America” and a “triumph for all parties,” thanking management for keeping the economy running during the epidemic.
All of this happened after Biden said early on Thursday that US freight train businesses and unions had struck a “tentative” agreement, preventing a potentially disastrous strike before the crucial midterm elections.
According to a group that represents rail companies, the agreement, reached as a nationwide rail strike loomed at midnight on Friday, will raise rail employees’ salaries by 24 percent from 2020 to 2024. Workers will receive an average lump sum payment of $11,000 for the backdated portion of the raise.
“Tens of thousands of train employees who worked diligently during the epidemic to guarantee that America’s families and communities received delivery of what had kept us going through these tough years” were winners, according to Biden, who hailed the agreement.
Martin J. Walsh, the labour secretary under Vice President Biden, and the White House intervened to assist mediate a deal as talks between the train firms and the unions approached their last hours.
Union members must now vote on the proposed accord.
However, even if they reject it, the customary wording included in such a pact has prevented a train shutdown for many weeks, according to a source familiar with the discussions.
The walkout would have disrupted passenger train service, which generally uses freight lines, and would have cost the economy an estimated $2 billion per day in lost productivity.
The nation’s private freight train firms and the several unions that represent its roughly 60,000 workers came to a preliminary deal, which would cost the businesses around $660 million in lump sum payments.
According to the Bureau of Labor Statistics, locomotive engineers presently earn an average yearly income of about $73,000. The agreement also covers signalmen and a number of other essential train professions.
However, in the hopes of preventing such a disastrous shutdown, representatives of Biden’s administration continued to hold discussions in Washington between the freight train corporations and unionised employees.
After a protracted night of negotiations, Biden said that the parties had struck a provisional deal to avert a shutdown that would be put to a vote among union members.
In a statement, Biden praised the agreement for averting a shutdown and for being a victory for all parties.
These train employees will get greater compensation, better working conditions, and assurance about their health care expenditures, all of which were earned, according to Biden.
The accord is also a win for railroad firms, who will be allowed to retain and hire more employees for a sector that will remain a pillar of the American economy for years to come.
Just the day before, the president’s condition seemed to be far more precarious.
Ryan Buchalski, a member of United Auto Workers Local 598, presented Biden as “the most union- and labor-friendly president in American history” and someone who was “kickin’ ass for the working class” on Wednesday at the Detroit auto show. Buchalski made reference to the important 1930s sit-down strikes by autoworkers.
In the address that followed, Biden acknowledged that the UAW and the International Brotherhood of Electrical Workers, among others, had helped put him in the White House and “brought me to the dance.”
However, back in Washington, labour department officials in his administration were engaged in tight talks to avoid a strike, which is one of the most effective tools unions have to compel reform and improve working conditions.
Without the agreement negotiated by the 12 unions, a slowdown could have started as early as Friday and cost $2 billion per day in lost fuel and food supplies.
For 115,000 railroad employees who were members of a union, much more was at risk than just sick days and pay raises. The consequences may include having no influence over Congress and the shipping system that supplies retailers’ shelves, keeps industries running, and holds the United States together as a global economic force.
According to experts, a strike would have complicated the nation’s already complicated supply system and increased prices.
According to CNN, without the freight railroads, oil refineries would not have been able to produce the amount of gas they currently do. They also wouldn’t have been able to transport recently harvested crops to food processors, and the supply of fertiliser needed to grow new crops would have been disrupted.
Additionally, any rail strike would have a long-lasting detrimental impact on the import of products during the Christmas season, leading to shortages and increased pricing, according to the National Retail Federation.
Additionally, a rail strike would have prevented the transportation of computer chips and other automobile components, which are already in short supply, preventing them from reaching auto assembly facilities and perhaps forcing temporary shutdowns at some of America’s auto factories.
Additionally, it would have halted the 75 percent rail-based flow of newly built automobiles and trucks to dealers throughout the nation.
The Department of Transportation has also referenced the Association of American Railroads’ estimate that a rail strike could cost the US economy a total of $2 billion a day in lost economic production.
Karine Jean-Pierre, the press secretary for the White House, said that a train worker strike would be “an unacceptable conclusion for our economy and the American people” when speaking from Air Force One on Wednesday as it flew to Detroit.
She said that in order to settle any unresolved difficulties and reach an agreement, the train lines and the employees’ representatives “ought to stay at the table and negotiate in good faith.”
Biden was in a similar situation as Theodore Roosevelt with coal in 1902 and Harry Truman with steel in 1952: how do you strike a compromise between the demands of labour and industry while doing what’s best for the country? Since railroads were crucial to keeping the war effort moving and avoiding strikes, Woodrow Wilson temporarily nationalised the sector.
Biden’s commitment to unions and his desire to prevent a strike are not in conflict in the eyes of his advisers, who work within the White House. As seen by a 56 percent rise in requests for union representation filed with the National Labor Relations Board so far this fiscal year, union activity has increased significantly under Biden.
Biden approached the issue with the perspective that he is the president of the whole nation, not just for organised labour, according to a source with knowledge of the situation who went on the record to describe White House discussions on the subject.
The president wants to maintain good relations between all sides so that a settlement can be reached while the economy is still recuperating from the pandemic’s effects on the supply chain. The source said that the White House believed that continuing negotiations in good faith was the best way to prevent a shutdown and uphold the values of collective bargaining that Biden cherishes.
Biden was also aware that a halt might exacerbate the factors that have fueled skyrocketing inflation and caused political problems for the ruling party.
Nobody wants a train strike, he added, not the businesses, not the employees, and not the White House. Nobody wants it at this time so close to the election,
The concerns Biden has backed in speeches and with his policy proposals—sick leave and bereavement leave—were the sticking point in the negotiations, according to Vale.
Sensing a political opening, Senate Republicans tried to approve a bill on Wednesday that would require railroad businesses and unions to adhere to certain contract provisions in order to prevent a shutdown. It was stopped by Democrats, who are in charge of both Houses of Congress.
According to Senate Minority Leader Mitch McConnell, R-Kentucky, “if a strike happens and paralyses food, fertiliser, and energy supplies nationally, it will be because Democrats opposed this measure.”
Members of the Business Roundtable, a Washington-based organisation that represents CEOs, were aware of the possible economic effects of a strike. On Wednesday, it released its quarterly economic forecast.
According to Josh Bolten, the organization’s CEO, “We’ve been facing a lot of headwinds from supply chain challenges since the epidemic began and those problems would be geometrically exacerbated.” There are expected to be closures at many industrial facilities around the nation. Our water needs some essential ingredients to be clean.
On Wednesday, the roundtable’s board of directors also met. Bolten, however, said that Lance Fritz, the CEO of Union Pacific railroad and the leader of the board’s international committee, would miss it “because he’s working hard trying to put the strike to an end.”
As negotiations continued into Wednesday night at the Labor Department, participants ordered Italian cuisine. At 5:05 in the morning on Thursday, the White House declared the conclusion of the negotiations.