New York: The Biden administration ramped up its efforts Wednesday to avoid a major strike by US freight railroad workers this weekend, which threatens to disrupt travel and supply chains two months before crucial midterm elections.
Pressure was growing on both sides to reach a deal ahead of a Friday deadline, with Amtrak canceling passenger routes in anticipation of disruption as farmers and retailers warned of supply chain chaos and called on Congress to intervene if necessary.
Negotiations are concentrated on provisions for vacation and sick days, with employees complaining they sometimes have to work long hours because of staff shortages.
Freight railroad companies and two unions representing mainly train conductors were called to a meeting at the Labor Department in Washington on Wednesday, two days after President Joe Biden sought to mediate the dispute.
In order to avert a strike on Friday at midnight, the sides would need to reach a deal, which would then be presented to the union members for a vote.
Absent an agreement, the unions and management could decide to continue the talks, keeping railroad workers on the job - or Congress could step in to block the strike.
Any strike would be bad news for Biden, who regularly expresses strong support for workers but is also struggling to avoid further economic damage ahead of key midterm congressional elections in early November.
Voters already are worried about soaring prices in the post-pandemic economy, where supply chain issues have been a constant scourge and annual inflation has surged to a 40-year high.
"The president and members of cabinet have been in touch with both unions and companies involved multiple times in order to try to avert a rail shutdown," White House spokeswoman Karine Jean-Pierre said in a briefing Wednesday.
"All parties need to stay at the table, bargain in good faith to resolve outstanding issues and come to an agreement," she said. "A shutdown of our freight system rail system is an unacceptable outcome for our economy of the American people, and all parties must work to avoid just that."
'Critical'
The Association of American Railroads has warned that a strike would bring 7,000 trains to a halt and could cost $2 billion a day.
Biden in July appointed an arbitration panel to facilitate the discussions and head off a work stoppage. The "emergency board" submitted its recommendations last month, and lawmakers could require the parties to accept the compromise if no deal is reached.
Farmers and retailers urged Congress to do just that if a long strike appeared on the cards, warning it would hit the US supply chains already battered by the Covid-19 pandemic.
"There is no real substitute for moving agricultural goods," American Farm Bureau Federation President Zippy Duvall said Wednesday, warning of the impact on the global food chain if US farmers and ranchers cannot move their goods.
The National Retail Federation called freight rail "critical to the retail supply chain."
"The timing coincides directly with peak shipping season for the winter holidays, and a rail strike at this juncture would be just one more significant, inflationary shock to an economy that is already reeling," warned NRF CEO Matthew Shay.
Both organisations called on Congress to act quickly to avoid a shutdown.
Amtrak - which is not involved in the talks - said it was canceling the rest of its long distance passenger trains starting from Thursday to avoid disruption.
The company had already canceled several passenger routes, including long distance routes earlier this week in advance of any strike.
Local commuter lines in the nation's capital also warned of potential disruptions. Meanwhile, freight companies began making arrangements on Monday to transport hazardous materials.
The leaders of 10 other unions have already reached an agreement with the companies, which they were taking back to their members. One, the IAM District 19 union, said Wednesday its members rejected the deal, although it agreed to continue talks until September 29. Two others said Wednesday that their members had ratified the deal.
Yellen's warning
Treasury Secretary Janet Yellen said a strike by rail workers would cause a "significant impediment" to shipping goods nationwide and that the US could feel some spillover from a possible recession in Europe this winter.
The White House is leading talks between labor and freight-rail firms that risks a system-wide halt as soon as Friday. The dispute is already triggering protective shutdowns of cargo and some passenger services.
Yellen, speaking in an interview with CBS aired Wednesday evening, also said that she expects to see a "substantial improvement over the coming year" on inflation, which is near a four-decade high.
"I do believe it will come down over time due to actions the Fed is taking," she said.S urging energy prices in Europe heading into winter threaten tipping the region into a recession.
"A recession in Europe would have spillovers for us," she said. "I do think this winter is going to be tough and challenging for our European neighbours."
