December 1, 2022
The Honorable Mitch McConnell
Republican Leader
U.S. Senate
Washington, D.C. 20510
Dear Leader McConnell:
On behalf of the eight undersigned organizations, we urge you support only the House-passed legislation to prevent an economically crippling strike on the nation’s railways. The Senate should also avoid the temptation to micromanage this issue and reject any other legislation that would alter the tentative agreements themselves.
As organizations that support free markets, we are all reluctant to become involved in the policy intricacies of private negotiations between management and labor. The Senate should likewise exercise caution with intervening in the private sector economy under the pretext that a critical function is imperiled. Unfortunately, the federal government has already intertwined itself in this dispute, leaving us with choices that are unappetizing to one degree or another. The most palatable option is to immediately implement, for the remaining four holdouts, the tentative agreements that eight of the twelve railway unions have already ratified.
Absent congressional action, a national strike on the railways would cripple an already teetering economy. Estimates vary on the costs of this work stoppage, and range from the tens of millions to the low billions per day. Whatever the actual damages might amount to, they would certainly be considerable. After all, railroads haul about 28% of the nation’s freight on a ton-mile basis. Other critical inputs for manufacturing such as coal, timber, grain, and chemical ingredients are all usually shipped by train. This would lead to another major supply chain shock similar to, if not worse than, the empty shelves experienced in 2021.
This June, railway unions expeditiously left mediation with rail companies and began to threaten national strikes. After significant public pressure, President Biden finally convened non-binding arbitration talks with a Presidential Emergency Board that performed fact-finding and held hearings from both sides. These talks resulted in recommendations that became tentative agreements.
These tentative agreements substantially increased wages, health care, and paid time off for all railway employees. In fact, if just those TAs were enacted, the average railway employee would be higher paid than nearly 90% of the country. At an average of $126,000 in total compensation per employee, that’s nearly double the 2021 median household income, and almost 30% more than the 2021 average household income. Rail workers would also continue to receive platinum health care benefits with 85% of the cost paid for by their employers. On top of that, their paid leave would be increased by a day from its current 3 weeks of vacation and 14 days personal leave.
Again, while the particulars of negotiations are less a concern among the signatories, by most accounts this is a great deal for railroad workers. Even Ivy League academics like Cornell’s Art Wheaton believe it’s a good agreement, stating “They got everything that they were asking for, for the most part.”
If the remaining unions cannot come to a voluntary arrangement prior to a strike, we urge the Senate to take properly measured and prudent action for the sake of consumers, taxpayers, and the U.S. economy. Limited steps such as this one now should be viewed as necessary to prevent even more intrusive federal government actions later.
Signed,
Saulius Anuzis
President
60 Plus Association
Steve Pociask
President & CEO
American Consumer Institute
Gerard Scimeca
Chairman
Consumer Action for a Strong Economy
Brian Minnich
Executive Vice President
Freedom Foundation
Charles Sauer
President
The Market Institute
Pete Sepp
President
National Taxpayers Union
Karen Kerrigan
President & CEO
Small Business & Entrepreneurship Council
Mike Stenhouse
CEO
Rhode Island Center for Freedom & Prosperity