(Bloomberg) -- President Joe Biden ratcheted up pressure on US port employers and shipping lines to restart talks with striking dock workers, warning that the unfolding strike could turn into a “man-made disaster.”
Biden spoke about the strike that has shuttered every major container port on the Atlantic and Gulf coasts before leaving on a trip to survey damage from Hurricane Helene, which has left communities in the US southeast facing an economic and humanitarian crisis.
“The last thing we need on top of that is a man-made disaster: what’s going on at the ports,” Biden said Wednesday. He said the companies that control the ports and have made “incredible profits,” calling on them to restart negotiations.
It’s time “for them to sit at the table and get this strike done,” he added.
The International Longshoremen’s Association called on members to walk out early Tuesday morning when their labor contract with the US Maritime Alliance expired. The two groups are at an impasse over wages, and perhaps a more intractable issue, automation.
The USMX, as the group is known, maintains that the union hasn’t bargained in good faith since calling off negotiations back in June. Hours before the midnight deadline, and with urging from the White House, the group offered to increase longshore wages by nearly 50% over the new six-year contract, up from a previous offer of almost 40%. The ILA rejected the offer.
Biden has backed the ILA’s position that the cargo handlers deserve a larger share of profits won by foreign-owned container liners during the pandemic-era supply chain crisis. Republican presidential nominee Donald Trump and Democratic candidate, Vice President Kamala Harris, have each echoed the sentiment, blaming the shipping companies.
White House Press Secretary Karine Jean-Pierre also placed blame for the impasse squarely at the feet of the port employers and shipping lines, criticizing them for the lack of talks while the US southeast recovers from a hurricane.
They need “to come to the table and put forward a fair offer to the longshoremen now,” she told reporters aboard Air Force One on Wednesday. “This should be easy for them to resolve. We’re recovering from a hurricane and they need to do so as soon as possible.”
The White House also called on carriers to withdraw any surcharges related to the strike — which halted about 50% of US container trade — and warned them not to exploit the emergency for profit. The two largest carriers have announced plans to impose extra fees tied to the work stoppage if it continues more than a few weeks.
The union said in a statement hours before the strike began that ocean carriers are already price gouging: “They are now charging $30,000 for a full container, a whopping increase from $6,000 per container just a few weeks ago.”
Xeneta’s Chief Analyst Peter Sand called the claim “misinformation” and warned that it could cause panic. The all-time record rate to ship a forty-foot container from Europe to the US East Coast is $8,790, set during the height of the pandemic.
“If a shipper does not have access to data to benchmark their own freight rates, they may believe the ILA’s claim of $30,000 per container and the market enters a vicious circle of higher and higher rates being paid,” he said.
Biden sidestepped a question on the union concerns about automation, saying the two sides need to negotiate a new labor contract like West Coast counterparts did last year.
“They won’t even talk. So let’s get that done,” he said, adding he had not yet spoken personally with USMX representatives.
In a statement released later Wednesday, the USMX said many of the critical issues that need to be negotiated are intertwined, and while they’re focused on returning to the bargaining table, “we cannot agree to preconditions” do to so.
(Updates with statement from the USMX.)
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