CEI - Competitive Enterprise Institute

10/03/2024 | News release | Distributed by Public on 10/03/2024 10:45

White House has several options in dockworkers strike, none of them good

Photo Credit: Getty

President Biden likes to call himself "Blue Collar Joe" and declare his support for union workers, but his administration has been thus far hesitant to act regarding the International Longshoreman Association (ILA)'s strike, which has immobilized 36 ports all along the east coast and the Gulf of Mexico. Biden and his team have a lot of options for how to deal with the 45,000 striking dockworkers, but none of them are political winners. So, for the time being, while the administration has had contact with the union, it is mostly just hoping the crisis goes away.

The options the White House faces are:

Throw its support fully behind the dockworkers: Biden and his vice president and his would-be successor, Kamala Harris, have leaned in this direction, saying that the dockworkers deserve a cut of the "record profits" that the ports have made. The advantage of doing this is that the White House and Harris campaign would be able to play the "we're-with-the-working-man" card, which might boost union turnout in the election. This option is not without its drawbacks, however. For one thing, dockworkers are already doing quite well. The average dockworker makes $150,000 annually and they already turned down an offer that would have boosted that by 50 percent. They want a 77 percent raise. In addition to that, the strike is threatening to create shortages for everyone else, so backing the ILA isn't likely to earn a lot of non-union votes.

The other issue is that the strike isn't just about money. The dockworkers also want an ironclad agreement for no further automation of the ports. Port management is loath to accept that demand, and it is something the administration ought to be wary of too. US ports are already far, far behind the international standard for automation and efficiency in large part due to union resistance to automation. That was a contributing factor to the supply chain crisis of 2021. The unions want to lock in place that level of automation for the foreseeable future. Should Harris win in the fall and the longshoremen get what they want, she faces the prospect of further crises like the one in 2021 during her administration. Critics will argue that the ports are inefficient because she helped prevent their modernization.

Intervene and call off the strike for now: The Biden administration has in its power the ability to force an 80-day cooling off period instead of a strike, thanks to the Taft-Hartley amendments to the National Labor Relations Act. Doing so would push the matter past the November election. The Biden team did something similar in 2022 when railway unions threatened to strike, and the administration became nervous about the potential economic impact of that. A mandatory cooling off period would prevent economic turmoil and get the issue out of the headlines. Politically, however, it runs the risk of sparking a backlash among union voters and the Elizabeth Warren/Bernie Sanders-type liberals who would view it as siding with corporate bigwigs and selling out the union.

It could also annoy union voters and swing them towards Trump. The Wall Street Journal published a picture Tuesday of striking dockworkers standing next to a Trump banner, indicating that he has support among the rank and file. ILA President Harold Daggett has said the union met privately with Trump last year and spoke positively of the meeting.

Play up being a moderate dealmaker: The administration can avoid using the Taft-Hartley ultimatum and instead bring both sides to the table to try to hammer out an amicable deal. This is a straight-up gamble: If a deal is reached and a larger crisis averted, then it's a big political win with smiles all around. If they cannot brokera deal, then the administration owns the issue, and critics will say that it failed in negotiations. The longshoremen's insistence on halting port automation means that any negotiations are likely to be a long and frustrating process, during which the economic impact of port closures will be felt by the public.

The 'hands off' approach: The Biden administration could just try to steer clear of the whole mess and hope the two sides reach a deal on their own without creating too much economic turmoil in the process. That's more or less what the White House has done so far. It is not a good long-term strategy, however. The longer a major labor strike goes on, the more any inactivity makes the sitting administration look ineffective and weak.

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