A strike could take place on December 9 as rail companies and labor unions fail to reach an agreement. The letter, spearheaded by the U.S. Chamber of Commerce, demands that members of Congress use their authority under the Railway Labor Act to intervene in the negotiations, a move that officials have taken 18 times since the legislation was passed in 1926.
“No one wins when the railroads stop running. Congress recognized their necessity to interstate commerce and America’s economic health with the passage of the Railway Labor Act and past congressional interventions in rail labor disputes when other steps fail,” the letter said. “While a voluntary agreement with the four holdout unions is the best outcome, the risks to America’s economy and communities simply make a national rail strike unacceptable. 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.”
SMART Transportation Division, a union representing rail conductors, announced last week that members failed to approve a deal offering workers new health benefits and a 24% pay increase within the next two years, marking the largest wage hike for the industry in four decades. The daily economic cost of a nationwide rail shutdown, however, could amount to $2 billion, according to a report from the Association of American Railroads.
Among other consequences, the letter noted that commuter rail services could be disrupted ahead of the holidays, while chemical shipments necessary for wastewater treatment and businesses engaged in the “critical holiday shopping season” could see disruptions. The letter was addressed to House Speaker Nancy Pelosi (D-CA), House Minority Leader Kevin McCarthy (R-CA), Senate Majority Leader Chuck Schumer (D-NY), and Senate Minority Leader Mitch McConnell (R-KY).
“Many businesses and communities rely on regular, uninterrupted rail service. The uncertainty of rail service during this year’s protracted contract negotiations has created enormous anxiety,” the letter added. “The freight railroads must safely reduce operations and secure their customers’ goods days in advance of a potential strike, meaning businesses and communities saw interruptions in the delivery of fertilizers, chlorine, and other products essential to clean water, our food supply, and electricity generation.”
Retail Industry Leaders Association President Brian Dodge nevertheless said during an interview with CNN that the holiday shopping season would not be disrupted by a potential strike, since “the stuff that needs to move for the holidays has already moved by rail.” His organization, which represents major retailers such as Walmart and Home Depot, noted in a letter to the White House that freight rail accounts for 40% of long-distance shipping volume.
GasBuddy analyst Patrick De Haan previously remarked on social media that gas prices could increase between $0.35 per gallon and $0.75 per gallon if a railroad strike continued for multiple days since ethanol, a renewable fuel made of plant materials and blended into various gasoline products, primarily moves via rail. National average gas prices are currently $3.55 per gallon, marking a 49% increase since the beginning of last year, according to data from AAA.