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White House urges end to labor fight at East, Gulf Coast seaports

December 27, 2012|By Ronald D. White
  • A container ship approaches a cargo terminal at Georgia Ports Authority in Savannah. The nation's fourth-busiest harbor is one of the seaports that would be idled if dockworkers strike along the East and Gulf coasts.
A container ship approaches a cargo terminal at Georgia Ports Authority… (Stephen Morton / Bloomberg )

The Obama administration is urging union dockworkers and a management group to "continue their work at the negotiating table to get a deal done as quickly as possible" to avoid a strike that could idle 14 East and Gulf Coast seaports.

The word that President Obama is keeping a close eye on the ports' labor situation came from Obama spokesman Matt Lehrich.

The labor union -- the International Longshoremen's Assn. -- and a group known as the U.S. Maritime Alliance are closing in on the end of a 90-day contract extension. The extension ends at midnight Saturday.

The alliance is made up of several shipping lines, terminal operators and port associations.

If no agreement on a new contract is reached, a strike could begin as early as Sunday. It would be the first strike by the ILA in 35 years.

As many as 14 major seaports and 14,500 union workers would be affected. But a group of retailers, manufacturers, farmers and other interested parties have said that the effects of such a strike on the nation's economy could be devastating. The vast majority of the nation's imports and exports move by sea.

U.S. military shipments and so-called bulk cargo that is not carried in 20-foot to 40-foot-long steel cargo containers would not be affected. But more than 50% of the nation's containerized import goods sold by U.S. retailers would be affected. A large portion of the country's agricultural exports would also be impacted.

On Thursday, there was no new developments to report on the state of the negotiations.

Earlier in the week, George H. Cohen, director of the Federal Mediation and Conciliation Service, issued a statement saying that both sides had agreed to meet. The statement said that "due to the sensitive nature of the negotiations," there would be "no additional comment at this time."

John Husing, an economist and founder of the Redlands firm Economics and Politics Inc., said the biggest issue of contention involves so-called container royalty fees on cargo, which supplement dockworker wages. Employers want to cap those fees and limit who gets them. The union says the royalty fees should not be changed.

The ILA says it represents 65,000 dockworkers on the East and Gulf coasts as well as on several major U.S. rivers and the Great Lakes and in Puerto Rico and Eastern Canada.

The impact of a strike would be mitigated by one thing: This is the slowest season for cargo coming by sea into the U.S. Shippers have usually moved their goods for the busy holiday retail season by October.

Even so, a "failure to reach a contract agreement would result in a coast-wide shutdown at 14 containerized ports -- from Maine to Texas -- which would have serious economy-wide impacts," the retail federation and coalition of national and state organizations said in a letter sent to Obama.

Late last month, most of the Port of Los Angeles and half of the Port of Long Beach were shut down during an eight-day strike by the clerical unit of the International Longshore and Warehouse Union.

The ILWU, which represents West Coast dockworkers, is not affiliated with the ILA.

Meanwhile, management at three of the four grain terminal operations at ports in the Pacific Northwest have given union dockworkers what they call their final contract offer.

A strike or a lockout at those terminals would strand millions of dollars of U.S. agricultural exports destined for sale overseas.


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