Rail strike averted…
…for now.
The agreement is universally described as tentative:
With the deadline to avert a freight railroad strike by Friday morning approaching fast, a tentative agreement has been reached according to the Labor Department.
The new contracts provide rail workers a 24% wage increase during the five-year period from 2020 through 2024, including an immediate payout on average of $11,000 upon ratification, the Association of American Railroads said. The industry trade group added that all tentative agreements are subject to ratification by the unions’ membership…
All the tentative deals are based closely on the recommendations of a Presidential Emergency Board that Biden appointed this summer that called for 24% raises and $5,000 in bonuses in a five-year deal that’s retroactive to 2020. Those recommendations also include one additional paid leave day a year and higher health insurance costs.
More here:
…[U]nion members angered by tough work conditions have yet to ratify the agreement…
Workers have gone three years without a raise amid the contract dispute, with talks stalling over attendance, sick time and scheduling issues. Only two of 12 unions – representing less than 10% of the workforce – are known to have ratified new contracts with freight railways.
The unions, including two large groups representing around 60,000 workers, will need to persuade their members to vote for Thursday’s deal. That might be a tough sell, labor experts warned.
“There’s a lot of anger among the members of these two unions because they feel, after being essential workers during the COVID pandemic, they were getting screwed on the attendance policy and getting punished for taking sick leave,” said Seth Harris, a professor of Northeastern University and former Biden administration official focused on labor and the economy.
They’re been negotiating this for over two years.
Railroad workers seem to have been another category of COVID economic and job satisfaction casualty.
And although I’ve read a couple of articles about the tentative agreement and they include plenty about the possible impact of a strike, I have yet to see any mention of the economic impact of a settlement like this on the US economy and the price of things shipped by rail. Seems to me the price of goods would have to go up no matter what, if workers are paid so much more. Will their raises even make much of a difference for them after all is said and done, considering inflation?
As I wrote yesterday, the Democrats are highly motivated to avoid a strike that would impact negatively on them for the 2022 election, so if there are further snags I expect they will move heaven and earth to resolve them.
So many potential points of failure within civilization’s supply chain.
Well we all can’t be hunters and gatherers any more. Even Unicorns and Skittles are a scarcity.
We’ll see. I bought some extra paper supplies today, and I have a freezer full of food.
This can’t help but drive inflation up.
Neo, “……. so if there are further snags I expect they will move heaven and earth to resolve them.”
Those moves may keep the rails open and humming, but like so much the Biden admin does, it’s going to cost us money. During the inflation of the 1970s this was a pattern that kept inflation rolling – unions demanding and getting inflationary raises.
Where do we retirees turn to get a raise that keeps us even with inflation?
Since inflation has been kindled by Biden’s energy policies, supply chain problems, and too much government spending; guess how it could be stopped? Not with EVs or charging stations. Not with student loan forgiveness. Not with solar and wind energy. Not with an open southern border. Not with any Biden policies. We know what works; we just have to elect those who know also.
“There’s a lot of anger among the members of these two unions because they feel, after being essential workers during the COVID pandemic, they were getting screwed on the attendance policy and getting punished for taking sick leave,” said Seth Harris …
Dare we infer?: All those other workers got to go home (and to the beach) and party and snooze, but nooo – – us railworkers had to work. How unfair.
I briefly looked at David Foster’s links. There was talk of the necessity of having two skilled people operating the locomotive rather than just one. I imagine that the rail lines themselves need a substantial amount labor for upkeep, but I don’t see that operating the trains would require much labor.
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The politics: Yes, the Dems hold many levers of power. There won’t be any strikes until after the election.
BTW, just how many levers of power do they hold?? Did you see the federal anti-abortion law that Lindsey Graham is promoting now? Someone explain to me how this is not an element of the Democrat Party pre-election playbook? I mean, if Graham had a nearly unblemished record of being conservative and principled I might believe his claim that he cares so deeply about the sanctity of human life. But he hasn’t and I don’t believe him.
JJ: Where do we retirees turn to get a raise that keeps us even with inflation?
A tough road for many people. For myself, I take solace in the stock market run ups in 2019-2021, recognizing those gains in my accounts did not truly represent real increases in wealth*, but put me numerically so far ahead of “normal” inflation that falling back now is simply correcting the previous imbalance. Well, that’s what I tell myself, anyway.
*Yes, that paper wealth could have been converted to “real wealth” to spend on cars, boats, vacations, 2nd homes, etc., if I was willing to pay the taxes upon converting it to net cash income. But too many years of living frugally before retirement and before I had to take IRA RMDs have distorted my “desire” vs. economic demand function.
R2L, I hear you. I made my nut in the tech boom of 1999-2000. I’ve been taking RMDs for 18 years now, but I quit the market except for preferred stocks and CDs in 2012 when Obama was re-elected. (That was obviously a mistake, but I’ve slept better than I would have otherwise.)
I am having some things fixed in our home and am gob-smacked at the prices. Skilled labor is getting $90-100/hour. Unskilled labor is over $25.hour. Lumber, drywall, nails, screws, etc. are double in price what they were three years ago. I’ve had to scale back what we planned.
During the inflation of the1970s Iwas able to get pay raises and knew enough to invest in some gold and silver, which held their value back then. I’ve been watching them, and they are not performing as they did in the 70s. Don’t know why. Maybe the investing world will wake up to how deeply embedded the inflation is. (I think so many are used to easy money and low interest rates that they can’t believe rates will keep rising.) and start buying gold and silver. We’ll see.
All retirees on fixed incomes will need to be aware of what can happen as this inflation starts to become more entrenched.