Since July 2014 the Pacific Maritime Association (PMA) and the Int’l Longshore and Warehouse Union (ILWU) have operated without a contract, while trying to negotiate a new agreement, causing systematic labor slowdowns that have escalated to the point of shipment delays and a large backlog at west coast ports. This not only increases costs to exporters, but risks permanently damaging customer relations.

Last week, the PMA held a press conference and announced a “last, best offer” and the ILWU issued a response.  A federal mediator joined the talks in January, and while negotiations have not ceased, comments and actions from both sides has increased concern that a strike or lockout is possible.  A labor dispute in 2002 resulted in West Coast ports shutting down for more than 10 days before President George W. Bush invoked the Taft-Hartley Act and the ports were reopened while mediators negotiated a deal.

A shutdown of the west coast ports would have a tremendous impact on the U.S. economy. The ports of Los Angeles and Long Beach together handle approximately 40 percent of the country’s containerized imports. A report commissioned by the National Association of Manufacturers and the National Retail Federation estimates the cost of a West Coast shutdown at nearly $2 billion a day.

On Tuesday, Feb. 10, the Senate Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety, and Security held a hearing titled “Keeping Goods Moving”.  Chairwoman Deb Fischer (R-NE) discussed the impact of the ongoing labor negotiations in her opening statement noting that “Members of Congress and the administration must pay close attention to these ongoing negotiations and the economic impact of service disruptions at our ports. This is particularly important as we face the potential for ports on both coasts to be negotiating simultaneously in 2018, which is when the current East Coast labor contract expires”.

The witnesses at the hearing included Cargill, BNSF, Moffat and Nichol and the Coalition for America's Gateways and Trade Corridors.  The Republican Senators in attendance (Fischer, Daines (R-MT), Thune (R-SD), Blunt (R-MO)) all mentioned the impact of the negotiations on constituents, and the need for resolution.  They also focused questions on the impact and how long it will take for the system to correct itself.

The issue was also the subject of an exchange at a White House Press Briefing with White House Deputy Press Secretary Eric Shultz. Shultz was asked whether the White House would be willing to employ Taft-Hartley to force negotiations forward and for the workers to go back to work. Shultz responded that officials at the White House and across the relative agencies are closely monitoring the situation and their belief is that both sides should be resolving this at the negotiating table.