While President Joe Biden was quick to hail Thursday's strike-averting rail agreement as a win for America, it was also a big win for him politically, allowing Democrats to sidestep what could have been an economic debacle before November’s midterm elections.
Pressured to choose between labor and business, the president pushed hard for them to work together.
Prodded by a strategic late-night phone call from Biden — and fortified with Italian takeout — corporate and union negotiators spent 20 hours in intense talks at the Labor Department. They reached wee-hours common ground following an appeal to act in the shared interests of the nation, avoiding a strike that would have shut down railroads across the country.
By keeping the trains running, Biden overcame a major economic threat that doubled as a political risk. His fellow Democrats already face a difficult fight to maintain their narrow hold on power in Congress amid soaring inflation. Biden's own approval rating, though improving, is still underwater.
The tentative deal, which still requires approval from a dozen unions, would raise members' pay 24% over five years and improve work schedules and health care in a way that Biden said recognizes “the dignity of their work.” Railroad companies could continue vital operations and avoid a costly shutdown, while being in a better place to recruit and retain employees.
“This agreement allows us to continue to rebuild a better America with an economy that truly works for working people and their families,” Biden said Thursday in celebratory remarks in the Rose Garden. “Today is a win, I mean it sincerely, a win for America.”
Members of one union, the International Association of Machinists and Aerospace Workers District 19, voted to reject the tentative agreement, but the IAM agreed to delay any strike by its members to allow more time for possible additional negotiations and for other unions to vote.
White House officials had worried that a rail shutdown, no matter how long, would have perilous economic consequences just as voters make up their minds ahead of the November elections. The settlement, instead, now provides Biden an opportunity to show his administration is delivering for voters, as dire news coverage yields to relief at the cost of only a few canceled Amtrak trains.
Through the talks, Biden managed to avoid the disruption without offending either labor or corporate constituencies. Biden, his advisers and Democrats across the country know the broadest possible coalition is needed to help candidates compete in midterms that have historically favored the party out of political power.
Biden intentionally chose not to dictate the terms of the agreement to either side, said Labor Secretary Marty Walsh.
“The president’s focus was making sure that a contract was done that is satisfactory to everybody — and also prevented a major disruption to our economy,” said Walsh, who moved the last six hours of negotiations into his office.
What initially appeared to be a worst-case scenario ultimately turned into a collective sigh of relief.
“This is the best outcome the Biden administration could have hoped for,” said Jake Rosenfeld, a sociologist at Washington University in St. Louis who has researched the labor movement. He noted that the unions' requests for sick leave and reliable scheduling aligned with Biden's own values.
“Unlike in past labor disputes involving the railroads, the administration never had to put real pressure on the unions, but instead could act like an honest broker looking for a compromise between management and union positions," Rosenfeld said. "That keeps the administration in good graces with labor more broadly."
Business interests also praised the administration's efforts. John Drake, the U.S. Chamber of Commerce vice president of transportation policy, said Walsh came to the table with a level of expertise and the trust of stakeholders. That made it easier to finalize a deal.
“The ramifications of a rail strike were so catastrophic that we couldn’t even begin to catalog it," Drake said. "This is 100% a win.”
Not everyone celebrated. Senate Republican Leader Mitch McConnell had proposed a measure on Wednesday that would have forced the unions to accept a contract. He criticized Senate Democrats for blocking his proposal, only to have aides stay silent on Thursday when asked whether the agreement was good for the economy.
Biden has gone out of his way to champion organized labor, often having members of local unions introduce him for speeches across the country.
UAW Local 598's Ryan Buchalski, introduced Biden on Wednesday at the Detroit auto show as “the most union- and labor-friendly president in American history” and someone who was “kickin’ ass for the working class.” Buchalski harked back to pivotal sitdown strikes by autoworkers in the 1930s.
In the speech that followed, Biden recognized that he wouldn’t be in the White House without the support of unions such as the UAW and the IBEW electrical workers, saying that autoworkers “brung me to the dance.”
About 16% of voters in the 2020 election came from union households, which backed Biden 56% to 42% in the narrowly decided race, according to AP VoteCast.
The president's approval took a major hit starting last year because of inflation worsened by supply chain disruptions for autos, furniture and other basic goods coming out of the pandemic recession. The problems intensified this year with a baby formula shortage and diminished supplies worldwide of food, oil and natural gas after Russia's February invasion of Ukraine. Consumer inflation hit a 40-year high in June, only to start drifting down in the two months since.
Biden's popularity has been regaining ground as gasoline costs have declined. A new poll by AP-NORC Center for Public Affairs Research shows his approval improving from a low of 36% in July to 45% in the most recent survey.
Estimates put the daily cost of a railroad shutdown at $2 billion. A stoppage would have left stranded raw materials for factories, fuel and even the chemicals needed to treat wastewater. That would have been a potentially debilitating blow just eight weeks before Election Day, which could determine control of the House, Senate and state governments.
AFL-CIO President Liz Shuler said the deal will ultimately have an impact on the midterm elections because workers want officials who will stand up for them. The mix of the pandemic, high prices and economic inequality has left many workers at the breaking point and they want a different social contract, she said.
“That’s what this election is all about — rewriting the rules of the economy,” Shuler said.
