US Railroad Strike Has Been Avoided Biden Calls the Agreement a Win for America

US Railroad Strike Has Been Avoided Biden Calls the Agreement a  Win for America

 

A tentative agreement was reached between major U.S. railways and unions on Thursday after 20 hours of difficult negotiations facilitated by President Joe Biden's administration. A rail shutdown that might have impacted food and fuel supply across the nation and abroad was avoided. 

Biden referred to the agreement as a "huge win for America" and for thousands of railroad employees. The Democratic president thanked industry and labor and pledged to enact more worker-company partnerships in the future. 

Biden expressed optimism that similar progress may be made in other sectors.

Unions and management can collaborate for the good of all parties, said Biden. 

Workers whose salary had been frozen would receive double-digit raises and will be permitted to receive specific types of medical treatment without risk of being penalized if they accept the agreement, according to union leaders, which was announced at around 5 a.m. According to the railroads, the agreement includes an immediate 14.1% wage increase. 

Unions will now vote on the agreement after their members vehemently opposed earlier plans. The customary language contained in such a settlement has prevented a rail strike, which could have happened as soon as one minute after midnight on Friday, for several weeks, according to a person familiar with the negotiations, even if those votes are unsuccessful.

Contract negotiations between unions representing 115,000 workers and railroads including Union Pacific, BNSF, CSX, Norfolk Southern, and Kansas City Southern took place in Washington for 20 straight hours under the auspices of Biden's Labor Secretary Marty Walsh.

Later on Thursday, officials are anticipated to give a news conference. 

If a settlement hadn't been reached before the deadline, workers would have been able to strike legally. 

An interruption in rail service could have caused the weighted average of almost 30% of U.S. cargo shipments to be frozen, fueled inflation, cost the economy up to $2 billion per day, and triggered a chain reaction of transportation issues affecting the country's energy, agriculture, manufacturing, healthcare, and retail sectors.

After conflicting economic statistics, railroad stock prices started to retreat. Union Pacific was up 2.2% in midday trading while CSX was down 2.0%. 

After rising 10% in the previous session, U.S. natural gas futures declined by around 9%; oil futures fell by roughly 4% to a one-week low. Futures for gasoline and diesel also decreased. Investors anticipated that a rail strike would have increased demand for alternative energy sources and jeopardized coal supplies to power plants. 

Passenger rail operator Amtrak announced that after postponing long-distance trains in anticipation of a strike, regular service would resume on Friday.

Because railroads connect the United States to Canada and Mexico and offer essential connections to enormous ships that transport products from across the world, the effects of a closure would have extended beyond American borders. 

Biden appointed an emergency board in July to help resolve the impasse in the more than two years-long negotiations between the firms and a dozen unions. According to a person familiar with the negotiations, Biden personally contacted Walsh and the negotiators on Wednesday night to press them toward a compromise, reminding them "once again to appreciate the impact" that a shutdown would have on families, farms, and businesses.

Matthew Shay, CEO of the National Retail Federation, hailed Biden's administration for getting involved and said in a statement that his organization is "relieved and cautiously optimistic." The contract was hailed by Emily Skor, CEO of the trade association for biofuels Growth Energy, who also pointed out that much of the nation's ethanol is transported by rail. 

Transportation of hazardous items, including shipments of ammonia for fertilizer and chlorine for water purification, as well as other shipments of goods that use rail and at least one other mode of transportation, have been stopped by freight railways. Their intention was to avoid leaving cargo stranded in dangerous areas.

Over the past six years, the railroad sector has reduced its personnel by about 30%, slashing wages and other expenses while increasing earnings, stock buybacks, and dividends for investors. Profits at BNSF owner and multi-billionaire Warren Buffett's Berkshire Hathaway increased 9.2% to $1.7 billion in the most recent quarter. 

According to the Bureau of Labor Statistics, the number of railroad employees in the United States has decreased from over 600,000 in 1970 to roughly 150,000 in 2022 as a result of technology and cost-cutting measures. As a result, a large number of sector workers are constantly on call, ready to respond at a moment's notice to labor for days on end.

The most recent agreement complies with certain earlier suggestions made by the president's emergency mediators. Along with $1,000 lump sum payouts spread out over five years, from 2020 to 2024, it also offers a 24% wage boost. 

Biden praised an agreement he said would give workers "greater compensation, improved working conditions, and peace of mind about their health care expenditures." Biden has dubbed himself the most union-friendly president in history and slammed corporations for making "excessive" profits.

When it comes to labor difficulties in the supply chain, the president is not yet out of the woods. High-stakes labor contract negotiations are also taking place for some 22,000 unionized workers at 29 ports on the West Coast that handle over 40% of American imports. 

Before the midterm elections in November, which will determine whether Biden's fellow Democrats keep control of Congress, administration officials wanted the disagreements settled. 

If the negotiations failed, senior congressional officials had threatened to pass legislation imposing a resolution on the railways and unions. Nancy Pelosi, the speaker of the U.S. House of Representatives, applauded the tentative agreement and stated that although Congress was "prepared to act," "glad this action may not be necessary."

source : NEWSMAX.COM