Amtrak Joe and the Railway Dilemma
President Joe Biden’s tenure had largely been marked by rhetoric towards unions and the labor movement that harkened back to the Democratic Party’s historical roots. Early in his presidency, Biden diverged from the tempestuous dynamic between the movement and his contemporary Democratic predecessors, opting for warmer ties. The month following Biden’s victory in securing his party’s nomination for President at the 2020 Democratic National Convention, he appeared at a Labor Day event hosted by the AFL-CIO, the largest union in the nation. At the event, Biden highlighted his own working-class background and pledged support for pro-union legislation, heralding himself to the audience to become the “strongest labor president you have ever had.” While Biden’s ambitious platform, which included passing bills such as the PRO Act to radically strengthen labor laws, never came to fruition thanks mainly to an evenly divided Senate, he was praised by labor interest groups for passing the Inflation Reduction Act and a bipartisan infrastructure bill that would generate over 800K new jobs by 2030.
And then the tide turned. In December of 2022, following months of failed negotiations between rail companies and union workers, President Biden faced a daunting choice between a strike-induced economic crisis or congressional intervention. Biden chose the latter, potentially jeopardizing the relatively warm relationship with organized labor he had enjoyed alongside his party. The “most pro-union” President now finds himself facing labor detractors who decry his administration’s intervention as revealing “how out of touch they are with the plight of railroad workers.” So how did Biden get here?
Understanding the origins of the rift between the rail unions and corporations is crucial in explaining the consequential nature of Biden’s decision. In the 1990s, a rail executive named E. Hunter Harrison devised a new service model for freight rail, Precision Scheduled Railroading or PSR. PSR shifted freight rail to a fixed departure schedule to maximize asset utility through rail network consolidation and the resulting low operating ratios. Essentially, PSR has allowed rail companies to reduce their own operating costs and become extraordinarily wealthy over the past few decades, with Texas-based freight rail operator BNSF alone raking in $23.3 billion in 2021. However, per reporting from Vice News that followed a series of significant rail accidents, rail executives have cut down staffing, benefits, and resources through their implementation of PSR. Staffing has been reduced to the bone leading to companies enacting attendance policies that workers have described as “draconian.”
Specifically, BNSF’s Hi-Viz attendance system, introduced in February 2022, generated enough controversy that hundreds of workers quit over the policy. The company eventually had to make modifications to the attendance system. Their initial policy had employees starting at 30 points, losing points for any days taken off, including for illness or family emergencies. Workers could gain 4 points, provided that they worked for 14 days consecutively. When the railroad unions attempted to strike in protest of the policy, BNSF successfully sued to block the union’s collective action efforts.
So when union negotiations ramped up in 2019 as existing contracts came up for amendments, tensions were bound to boil over into war. The National Mediation Board, the federal government’s agency that handles labor-management relations for airlines and railways, began mediating multiple negotiations between unions and rail operators in June 2021. However, negotiations broke down when the unions rejected the NMB’s proffer for arbitration in June of 2022. Biden then established a Presidential Emergency Board, and by August, the board issued recommendations for amendments to existing contracts. Biden was personally involved in these negotiations and announced the tentative deal reached in September, which included a 14% wage increase for workers and caps on healthcare premiums. However, the core issue of paid leave was left largely ignored, with the deal’s concession of only adding one additional personal day angering many union members. When the deal came to a vote for the unions involved, members of 4 of the 12 rail unions voted against the deal and threatened to strike if an agreement couldn’t be reached by December 9th.
The looming threat of a strike placed Biden in an exceedingly precarious situation. If he allowed rail unions to organize and protest, the American economy would come to a grinding halt. The Association of American Railroads, a trade group representing corporate rail interests, estimated that the strikes would cost the economy nearly $2 billion a day. Commentators and scholars began to sound alarm bells that the consequences of such collective action would be dire to all Americans as it could impact the transportation of everything from retail goods to chemicals such as chlorine which is used to filter water for entire counties. On the other hand, attempting to intervene through congressional action would likely upset unions and labor organizers, especially since Biden would, in essence, be forcing the hands of workers into returning to their positions without a deal. However, the economy’s health and fear of social upheaval took precedence for Mr. Biden. Fmr. Speaker Nancy Pelosi (D-CA) defended a potential intervention by stating that a strike meant that “Families wouldn’t be able to buy groceries or life-saving medications because it would be even more expensive and perishable goods would spoil before reaching shelves.” Biden announced on November 28th that he had asked Congress to pass legislation to adopt the proposed tentative agreement.
Congress acted quickly, and while the House passed an agreement that included seven days of paid sick leave for rail workers, the proposal quickly died in the Senate. Yet, Biden managed to both unite and divide Congress, garnering rare bipartisan unity to block the strikes while revealing fissures within the opposition and his own party regarding labor rights. Notably, while the Senate passed the framework of an agreement proposed by the White House by an 80-15 vote, the issue of sick leave splintered Republicans. Six Republican Senators, including Senators Cruz (R-TX) and Hawley (R-MO), joined the ranks of Senators Sanders (I-VT) and Warren (D-MA) in voting to provide rail workers with additional sick leave.
While Biden has likely not completely lost union support as a result of this debacle, the rail deal has revealed the fault lines in his coalition, especially between organized labor and the Democrats. As the party increasingly postures towards suburban and affluent voters, its grip on organized labor looks shaky at best. As a spokesperson for Railroad Workers United noted, “It’s a vice of the Democratic Party’s own making,” Facing a divided Congress, Biden’s hand will likely be forced on certain economic issues and may splinter his own party. With 2024 around the corner, the question remains: Will he manage to keep his coalition together?
