President Joe Biden took a victory lap last week when a nationwide railroad strike was averted following marathon negotiations that involved the federal government.
The agreement allowed Biden to burnish his pro-union credentials without moving into more controversial areas like the largely nonunion poultry processing industry that depends on rail service in his home state.
Using his executive powers to at least temporarily stop the strike would have brought the opposite effect. Even a two-day stoppage would have been bad news for the economy.
The agreement provides bonuses and wage increases in an industry that in blue-collar terms is considered to be in the high-pay category.
The back story here is the nature of railroading, an industry populated by a few carriers that employ technology and other methods to push down costs and reduce headcounts. The result has been reliable earnings, despite the ups and downs of a business that was on the ropes a few decades ago.
That’s the reason why Warren Buffett’s Berkshire Hathaway bought Burlington Northern Santa Fe, one of three megarailroads. The others are CSX and Norfolk Southern, with Canadian carriers snapping up the remaining lines.
The railroad giants went even further and shed their neglected branch lines. In Delaware, it led to Norfolk Southern turning over its Delmarva line to Pennsylvania-based Carload Express, which operates under the Delmarva Central name.
The good news here is that the new operators are doing a better job of marketing the advantages of rail for some bulk shipments. Also, work, thanks in part to federal assistance, is underway to deal with century-old bridges and neglected trackage.
No matter who operates the routes, the stress on engineers and brakemen is intense when running a mile-long train where any crossing or section of track can end lives and produce a lifetime of trauma for the men or women in the cab.
Scheduling designed to wring out inefficiencies also took its toll on the lives of individuals and their families.
Those maintaining the rails and equipment face similar challenges made worse by a workforce that was sometimes stretched to the limit.
More recently, this led to labor shortages, thanks to a smaller number of entry-level applicants as well as the latest generations of families with a history of working the rails opting for college or day jobs.
In pointing these things out, I am not reading from union literature. I saw it first- hand over the years.
Yes, the rail agreement will add to inflation pressures. But options were few. In this case, unions had the upper hand. – Doug Rainey, chief content officer.