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House Signals Steps to Avoid Rail Strike

On Monday evening, House Speaker Nancy Pelosi announced that lawmakers would begin the legislative process this week to conclude ongoing rail labor negotiations and avert a possible strike. This news came shortly after President Joe Biden called for action, according to the Associated Press.

Why it matters: Without a new labor contract in place between railroads and unions, a rail strike could take effect as soon as Dec. 9, with effects felt days earlier.

  • A strike could cost the U.S. economy nearly $2 billion per day, according to industry sources, while also boosting inflation and grinding supply chains to a standstill.
  • In addition to its impact on freight movements, a strike could wreak havoc on Amtrak and other commuter rail services, affecting up to 7 million travelers a day.

The president’s move: The Biden administration had been closely involved in negotiations this summer. Though Biden had been reluctant to short circuit the regular ratification process, the president said that action from Congress had become necessary to end the stalemate.

  • “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,” said Biden.

The terms: Pelosi said that the proposed legislation would impose a deal that unions generally approved in September.

  • “We are reluctant to bypass the standard ratification process for the Tentative Agreement — but we must act to prevent a catastrophic nationwide rail strike, which would grind our economy to a halt,” she said in a statement.
  • If Congress acts, it will end talks between the railroads and four unions that rejected the deal that Biden helped broker earlier this fall.
  • Eight other unions have approved their five-year deals with the railroads and are in the process of getting back pay for their workers for the 24% raises that are retroactive to 2020.

Our efforts: The news comes shortly after the NAM joined more than 400 organizations urging Congress to take action, calling on policymakers to exercise their authority by taking “immediate steps” to prevent a national rail strike.

  • “The risks to our nation’s economy and communities simply make a national rail strike unacceptable,” the message continued. “Therefore, absent a voluntary agreement, we call on you to take immediate steps to prevent a national rail strike and the certain economic destruction that would follow.”
  • NAM President and CEO Jay Timmons wrote yesterday that “Manufacturers support President Biden’s call for congressional action to avert a national rail strike. The impacts of a strike would be devastating. We join the president in urging immediate action to prevent further damage to the nation’s supply chain.”

NAM in the news: The AP, CNN and Reuters (subscription) highlighted the NAM’s efforts. 

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