President Bush Steps In to Reopen Ports
Evoking the Taft-Hartley Act of 1947, President George W. Bush secured a court order on Oct. 8 to force West Coast dockworkers back to work after 10 days of port closures. The court order will force the 29 affected ports to reopen, but experts say that it could be weeks or even months before the backlog is handled and traffic flows smoothly.
“If the union works at a slower-than-normal pace, it could take up to two months to get things straightened out,” said Jack Kyser, chief economist at the Los Angeles County Economic Development Corp. “We have about 500,000 containers in the backlog, and then we have to be aware that there could be glitches in other parts of the system. For example, the railroads have to get geared up and they have to get things out to the distribution centers, which apparel people use—they will be slammed.”
The president appointed a federal board of inquiry to investigate the recent lockout at the ports after it entered its second week. The number of vessels stranded at docks or backed up at anchor points rose to 200 with dozens more still heading in from Asia, prompting the board to immediately recommend that the president intervene in what the board saw as an impasse unlikely to end quickly.
Kyser expressed concern that a resolution may not come even during the cooling-off period provided by the Taft-Hartley Act.
“Both sides are pretty well dug in and I think it’s going to be pretty dicey,” he said. “They may end up going the full distance that the Taft-Hartley Act provides. The PMA [Pacific Maritime Association] made pretty generous offers to the union, but for some reason, the union just isn’t buying.”
One major sticking point in the dispute involves the question of who will control new jobs evolving out of improvements in cargo-tracking technology used on the waterfront. The PMA wants to pursue technological improvements, which the International Longshore and Warehouse Union fears will eliminate jobs.
Kyser warned that problems at the ports could continue and advised importers to plan cautiously or even investigate alternative shipping avenues.
New York-based manufacturer Younique typically uses West Coast ports for imported goods from Asia, but after watching the port activity for months, it put a backup plan into effect.
“We read about it for the last two months and we were able to catch some things before they went out,” said Robbie Regina, one of Younique’s partners. “Fortunately, most of our sportswear is domestic. Our denim is done in China, but we were able to get it shipped into New York, so that helps out.”
The Taft-Hartley Act is an amendment to the National Labor Relations Act of 1935 and was passed in 1947. The act provides protection for employees who want to refrain from participating in union activities and gives the president power to retain order in certain emergency situations such as a strike or a lockout that would adversely affect an entire industry, or in the current case, the national economy.
Experts have placed estimates of the daily loss from the port closures as high as $2 billion. —Darryl James
