White House urgently discussing contingency plans amid rail shutdown threat

CNN

By Phil Mattingly and Betsy Klein, CNN

The White House is urgently discussing contingency plans as the threat of a rail shut down looms, with agencies across the federal government working through how they could potentially use federal authority to keep critical supply chains operational as labor talks continue to sit at an impasse.

The work has ramped up in recent days as officials have grown increasingly concerned about a labor strike if freight-rail labor negotiations fail to produce an agreement ahead of Friday’s deadline. While officials have been closely watching the developments — and have gotten directly involved in an effort to find a resolution — for several weeks, the accelerated efforts to plan for a worst case scenario underscore the stakes of an outcome that would lead to massive supply chain disruptions, and dual-pronged political and economic risk.

“The White House is working with other modes of transportation (including shippers, truckers, air freight) to see how they can step in and keep goods moving, in case of a rail shutdown,” a White House official told CNN on Tuesday.

The official added that the administration “has also been working with relevant agencies to assess what supply chains and commodities are most likely to face severe disruptions, and the emergency authorities available to keep goods moving.”

About 60,000 union members who work for the railroad are set to go on strike, including the engineers and conductors who make up the two-person crews on each train. Even though 45,000 other union members belong to unions that have reached tentative deals with the railroads, a strike by engineers and conductors would bring the freight rail system, which carries nearly 30% of the nation’s freight, to a grinding halt.

Stakeholders are already warning that the situation is dire, the US Chamber of Commerce detailing some of the urgent issues in a letter to congressional leadership on Monday.

“A shutdown of the nation’s rail service would have enormous national consequences,” chamber executive vice president and chief policy officer Neil L. Bradley said in the letter.

He continued, “It would lead to perishable foods such dairy, fruits, and vegetables spoiling at their points of origin, would halt Amtrak service for approximately 12.2 million daily riders in 46 states, would disrupt materials and goods being delivered to factories and ports, and would inhibit the transport of heating fuel and other important fuels and chemicals. These are only a few examples of the damage of a rail shutdown.”

President Joe Biden continues to receive regular updates on the high-stakes negotiations, including briefings on the matter Monday evening and Tuesday morning. Senior-level engagements were expected to continue Tuesday. There are conversations with industry leaders and also “multiple interagency meetings” happening daily with the Departments of Transportation, Defense, Agriculture, Health and Human Services, and Energy, as well as the Federal Emergency Management Agency, the official said, with efforts toward “identifying the sectors and the goods that will be most immediately and significantly impacted by a rail stoppage.”

One area of key concern is hazardous materials carried by rail.

“We are paying particular attention to hazardous materials carried by rail, to protect the safety of workers and communities and to support the continued distribution of vital hazardous materials that depend on rail transport, such as chlorine for water treatment plants,” said the official, who added that “all tools are on the table and will be deployed as appropriate.”

While concern about a strike has heightened at the White House in recent days, the administration remains hopeful that the matter will be resolved. The President does not have the authority to head off a strike, but Congress can still act to prevent a work stoppage.

“We hope this planning and preparation will prove unnecessary and that negotiating parties will agree to a resolution and not allow American workers, families, and businesses to be hurt by a rail stoppage. We have been clear in all our communications with the negotiating parties that a shutdown is unacceptable and will hurt American workers, families, and businesses, and they must take action to avert it,” the official said.

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