Biden’s 11th-hour moves to avert a strike – and a political calamity

by Jeff Stein, Tyler Pager, Lauren Kaori Gurley / The Washington Post

11:42 JST, September 16, 2022

As White House aides grew desperate this week, with the hours ticking down toward a potentially devastating strike, they began discussing a high-profile gamble – President Biden could summon negotiators to the Oval Office, where he would urge them personally to stand down.

A last-minute resolution made the gambit unnecessary, but the idea reflected Biden’s deep personal involvement in one of the most dramatic confrontations between labor and capital in recent American history. The pro-union president, eager to avoid a massive economic disruption weeks before the midterms, urgently made phone calls and got updates late into Wednesday night.

Four decades after President Ronald Reagan fired thousands of striking air traffic controllers, Biden took a markedly different tack, often defending the workers’ demands in private discussions. And after a deal was struck in the predawn hours Thursday, he tried to turn the potential disaster into a political victory, welcoming the negotiating parties into the Oval Office to celebrate the agreement and regale them with stories of his journeys on Amtrak.

In typical Biden fashion, he publicly framed the deal – which still must be ratified by the union’s members – as a win for everyone, including the railroad companies. “They’re really the backbone of the economy,” Biden said. “I have a visual image of rails being the backbone – I mean, literally the backbone – of the economy.”

As the two sides stalemated in recent days, especially over sick days, the president grew animated in private about the lack of scheduling flexibility for workers, expressing confusion and anger that management was refusing to budge on that point, according to two people who spoke on the condition of anonymity to share details of private conversations.

Biden’s closest aides mirrored his personal engagement.

During one call with the negotiators, Transportation Secretary Pete Buttigieg told them a rail strike would deal a devastating blow to the nation’s infrastructure, comparing its impact to the Cold War, the Sept. 11 terrorist attacks and the coronavirus pandemic, according to a person familiar with his comments.

On Wednesday, Buttigieg traveled with Biden to Michigan for the Detroit Auto Show, and throughout the day, he periodically hopped on calls with railroad executives and other industry leaders to press for an agreement. Biden was also directly briefed while he was at the auto show, according to people familiar with the matter.

When Biden returned to Washington on Wednesday afternoon, he went directly to the Oval Office to receive an update on the progress of the negotiations. Around 7 p.m., he conferred with House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Charles E. Schumer (D-N.Y.) on the situation.

The president then called directly into the negotiations around 9 p.m. to speak with the labor and corporate leaders, urging them to strike a deal. He told them they needed to recognize the harm that a stoppage would cause for families, farmers and businesses, and asked them to meet each other halfway.

His main point was stark: The economic damage could be catastrophic. And they held the outcome in their hands.

Labor Secretary Marty Walsh, who led the talks, described in an interview how he set up three rooms at the Labor Department – one for the unions, one for the companies, and a third for the two sides to meet and talk.

Walsh stationed himself in the third room, hoping to be an encouraging presence. “I was asked my opinion on a few things and I gave it,” Walsh, himself a former union leader, said. “I was not taking sides. I don’t like to take a side because it shows you can’t be impartial. In this case, you want to be as impartial as possible.”

At dinnertime, the negotiators sent out for Italian food. And finally, at 2:30 a.m., they finalized an agreement letting workers take days off for sick leave and medical emergencies – the unions’ central demand – though it allowed for only one of the sick days to be paid.

Walsh quickly called Brian Deese, Biden’s top economic adviser, and by 5:15, documents had been drawn up and signed. When Walsh, who estimates he got 90 minutes of sleep, spoke to Biden around 7:45, “he was very appreciative,” the secretary said.

Overall, the standoff underlined Biden’s willingness to support the union even at the risk of a potential strike and the accompanying hit to the economy, a pro-labor position exceeding even that of other Democratic administrations.

“This level of support would have been impossible even under [President] Obama,” said Larry Cohen, who served as president of the Communications Workers of America. “This outcome would not have been possible under all preceding presidents.”

As recently as Wednesday, during a speech in Detroit, Biden trumpeted his embrace of the labor movement, declaring himself “so pro-union” and pointing to the United Auto Workers and the International Brotherhood of Electrical Workers, “who I owe a special thanks to for the last election.”

But Biden’s loyalty to unions is not without its critics. Republicans have slammed Biden’s handling of the rail strike as recklessly endangering America’s supply chains, potentially harming millions of consumers for the benefit of a relatively small number of workers.

Critics say Biden’s fealty to labor has handicapped his presidency in other ways, with even some Democratic economists claiming his efforts to spur rapid wage growth have exacerbated worker shortages and persistent inflation that is harmful to U.S. consumers.

The president was unmoved by such criticisms this week. In the face of significant pressure, he did not join calls for Congress to force the rail workers to accept a deal proposed by presidential panel last month, since union leaders objected to its terms.

The risk was substantial. A strike could have been an economic and political calamity for Biden two months before crucial midterm elections, as Republicans are seeking to paint Biden as a hapless president unable to stem soaring prices and economic jitters.

Biden had been making headway in beating back that message, as gas prices fell and Democrats passed landmark economic bills. A chaotic rail strike would have given the GOP message a powerful new boost.

Biden faced a vexing political dilemma as his need to keep down prices by averting a strike risked colliding with the pro-union sympathies that are central to his political identity.

In an additional twist, Biden has closely identified with Amtrak during his political career, giving added symbolism to the partial suspension of its operations a strike would have caused.

Beyond that, the standoff captured the tensions at the heart of the economy Biden has helped unleash. Under his leadership, Democrats in Congress approved a $1.9 trillion rescue plan last year that has created one of the tightest labor markets in decades, prompting extremely fast wage hikes and a record number of job openings.

That, in turn, has given workers new leverage and resulted in unionization efforts in key sectors across the country, with efforts to form unions at Amazon, Kellogg’s and many other employers with household names. Walsh even took the unusual step of walking the picket line at Kellogg’s.

But conservative economists say Biden’s economy is on balance leaving workers worse off, as soaring prices more than offset wage gains.

Brian Riedl, a policy analyst at the Manhattan Institute, a right-leaning think tank, pointed to Biden’s support for “Buy America” provisions that insulate industries from foreign competition but also raise consumer prices. Once adjusted for inflation, average hourly earnings are down by roughly 3 percent relative to last year.

“When push comes to shove, the president always chooses unions over fighting inflation,” Riedl said.

But organized labor also has not been uniformly thrilled with the president’s record. He failed to secure an increase in the minimum wage amid congressional resistance. Advocates have been waiting for months for new rules guaranteeing overtime compensation. Some of his top officials have close ties to corporate America.

Still, most labor advocates say Biden has largely kept to his promise to defend unions. In a break with his predecessors, Biden hosted the organizers of union drives at Starbucks and Amazon at the White House earlier this year. He has staffed the top levels of his administration with former labor leaders, signed an executive order mandating federal contractors pay a $15 an hour minimum wage, and appointed strongly pro-labor leadership to the National Labor Relations Board.

Two of the senior Biden aides most directly involved in brokering the rail standoff have themselves worked for top unions – Walsh, the labor secretary, was the chief of the Boston building trades union before running for office, and Celeste Drake, the senior White House labor adviser, led trade and globalization policy for the AFL-CIO.

“This agreement represents how far the labor movement has come in the last 40 years since Reagan fired air traffic controllers,” said Angela Hanks, who served in Biden’s Labor Department and is now chief of programs at Demos, a left-leaning think tank. “Tireless organizing helped seed the ground for a pro-worker president.”

On Thursday, Biden seemed to relish celebrating the deal, which he framed as a significant victory for workers and the country. After a celebratory event in the Rose Garden, the White House posted a photo on Twitter of Biden reading an editorial from the Wall Street Journal entitled, “Not Working on the Railroad.”

“Thanks for your concern, @WSJ,” Biden wrote on Twitter. “To answer your question: yes, the trains are running on time.”