Fears of US Railroad Strike Grow Ahead of Holidays

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Facts

  • The SMART Transportation Division (SMART-TD), one of the largest railroad unions in the US representing about 57K conductors and engineers, announced Monday that it narrowly voted to reject a White House-brokered contract. It's threatening to strike starting Dec. 5.
  • Although a majority of conductors and engineers voted in favor of the contract, the union requires all five classes of workers within its ranks to vote to ratify for it to be approved. Train and engine service members voted 50.87% against it.
  • The engine service members’ vote against the agreement means that negotiations for every union represented by SMART-TD failed. They agreed to continue working under a status-quo period unless one union goes on strike, in which case union leaders say the others will follow suit.
  • Because about 30% of the nation's freight moves by rail, Congress is already facing calls from businesses to prevent a strike. A strike would disrupt an already-struggling supply chain and raise prices for goods, including food and fuel.
  • Though the White House brokered a successful 24% pay increase in September, the agreement didn't address the points-based attendance policy that workers say creates a poor quality of life. Congress can step in via the Railway Labor Act of 1926 and impose a contract, though it would address neither paid sick leave nor attendance issues.
  • If there’s a strike, it could cost the economy an estimated $2B per day, including $2.8B in weekly chemical cargo — potentially leading to a decline in Gross Domestic Product and renewed inflation.

Sources: USA Today, CNN, Wall Street Journal, Washington Post, and CNBC.

Narratives

  • Republican narrative, as provided by Townhall. It’s bad enough that the Biden admin. botched this agreement and has put the country on the precipice of a catastrophic rail strike. What makes it worse is that the president did a victory lap — even though it wasn’t a done deal, and the deadline was scheduled for after the midterms so it wouldn’t hurt Democrats’ chances. Worse yet, the White House doesn’t have much of a contingency plan for dealing with a work stoppage.
  • Democratic narrative, as provided by Washington Post. With the White House’s help, the companies and the unions made great progress on an agreement that included the largest pay increase in 40 years. This deal was rejected by the narrowest of margins, so there has to be common ground that can be found to avert a strike. It’s time to finish the substantive gains made throughout these negotiations.