West Coast Dock strife could return as year end crisis   (stratfor) 

 Port Standoff: If No Resolution, What Next?
> 25 October 2002 

> Summary

> The long-running labor dispute at West Coast ports could re-emerge as a
>year-end crisis. But with the buildup for Iraq likely to be in full swing
>and the economic outlook still fragile, the Bush administration will have
>little patience for a strike. If one cannot be avoided, then Washington
>could be forced to take more drastic measures.

> Analysis

>  Shipping companies have asked the U.S. Justice Department to hold members
>of the dockworkers' union in contempt of court for intentionally slowing
>the pace of operations at West Coast ports, the Seattle Times reported Oct.
>24. As part of the complaint, shippers pointed to the fact that 194 ships
>were waiting to be unloaded off the West Coast ports on Oct. 21, compared
>to 224 ships 12 days earlier at the height of a management lockout of

> As the court-ordered "cool-down" period enters its third week, management
>and labor are even further apart, and the docks are almost as clogged as
>they were when U.S. President George W. Bush invoked the Taft-Hartley Act
>Oct. 9 to end the lockout at 29 ports. Considering that the ports'
>operations are vital both to a buildup in Iraq and to the U.S. economy,
>Washington simply cannot afford another crisis precipitated by failed
>negotiations, which likely would result in a dockworker strike. Fearing the
>eruption of a new crisis in late December or early January -- at what could
>be the height of an Iraq buildup -- the Bush administration will exert
>extreme pressure on both the labor and management sides to settle. 

> That will not ensure a settlement, however. According to the Congressional
>Research Service, of the 35 Taft-Hartley actions since 1947, 10 have
>resulted in strikes after the cooling-off period expired, and most of those
>involved longshore workers on the East Coast. If West Coast dockworkers do
>strike, then Washington could have little choice but to take drastic
>measures, such as a naval takeover of some if not all West Coast ports, or
>even move to formally break up the union. However the port standoff plays
>out, it will continue to drag on the U.S. and Asian economies, and it is
>threatening to become a serious distraction for Washington as it
>simultaneously tries to focus on Iraq and al Qaeda.

> The unionized dockworkers, represented by the International Longshore and
>Warehouse Union (ILWU), and the 80 shipping and stevedoring companies
>represented by the Pacific Maritime Association (PMA) have become
>increasingly polarized since Bush invoked Taft-Hartley. 

> The ILWU has accused the Bush administration of collusion with management,
>and some union leaders have accused the PMA and the Bush administration of
>an elaborate strategy to break the power of the unions. The ILWU laid out
>this accusation in an article posted on its Web site entitled "Locked Out
>and Shaft-Hartley'ed." The union considers the PMA's move for a court
>injunction through the Department of Justice -- which could result in fines
>and/or imprisonment of union leaders -- as a next step in this strategy. 

> For its part, the PMA said in a statement released Oct. 23 that the union
>has "engaged in a concerted, systematic work slowdown impacting
>productivity at every major port," in violation of the court order that
>ended the lockout and ordered all parties to resume normal operations. As
>evidence, it reports that in the first week following the lockout,
>productivity was down sharply at ports across the West Coast compared with
>normal operations, citing drops of 34 percent in Oakland, 27 percent in
>Seattle and Portland, 19 percent in Tacoma, and 9 percent in Los Angeles
>and Long Beach. 

> The longshoremen's union denies the accusations, saying instead that the
>severe backlog of cargo and the overwhelming workload have kept ports from
>operating normally. Dockworkers said Oct. 15 they had filed charges with
>the Labor Relations Committee against their employers for deliberately
>sabotaging efforts to clear the cargo congestion. They also accuse shippers
>of using the slowdown accusations as a way of breaking their union through
>the courts.

> Chance for Negotiations?

> Meanwhile, negotiations on a new contract -- to be overseen by a federal
>mediator -- were to resume Oct. 24. With both sides exchanging threats and
>accusations and hardening their positions, any settlement appears to be a
>long way off.

> The two sides will continue to discuss wages and the introduction of new
>technologies that shippers believe are crucial to bring ports up to global
>standards but that dockworkers fear will displace them. At its core, this
>dispute centers on whether unions would have any jurisdiction over the jobs
>such technology would create, behind which lies a battle for control over
>the future of U.S. ports. Shippers want to introduce technologies that they
>believe will reduce costs, increase efficiency and help bring West Coast
>ports up to speed with other U.S. and international ports like Hong Kong,
>Singapore and Rotterdam. Dockworkers and their union feel that the
>technology issue is being used as a crowbar to wrest power from the
>historically strong ILWU and to cut union jobs. 

> So far, management has maintained an advantage in negotiations. In
>statements as far back as April, the Bush administration made it fairly
>clear that it would side with management in the dispute, with Homeland
>Security chief Tom Ridge and Labor Secretary Elaine Chao warning that the
>government would not tolerate any labor disruption and would consider such
>a disruption an issue of national security. 

> Politically and ideologically, the administration also clearly falls on
>the side of the shippers and the powerful American retail interests who
>rely on cost-efficient ports and who desire greater technological
>innovation at manpower-dependent West Coast ports. With such an
>administration, shippers may have seen the latest contract negotiations as
>a golden opportunity to push their case for technological innovation while
>simultaneously prying more power away from the unions. 

> However, as the stakes rise, the PMA may need to recalculate the amount of
>support it will receive from Washington. As much as some in the
>administration may agree with management in principle, the administration
>is much more interested in avoiding a full-blown crisis. By invoking
>Taft-Hartley, the issue was put off until after mid-term elections. But
>now, with the economy still fragile and a war in Iraq most likely planned
>to begin in January or February, Washington will demand a settlement and
>use all its powers of persuasion and pressure to make it happen. 

> Pressure on Both Sides

> The U.S. government can exert a great deal of pressure on both sides to
>reach a settlement. That pressure may be more positive in nature with the
>PMA and its supporters, but it will be substantial nevertheless. Meanwhile,
>it has the provisions of Taft-Hartley with which to hammer the labor union. 

> That likely will include pursuing court injunctions against the ILWU that
>could result in fines and the arrest of labor leaders meant to weaken the
>union and the workers' resolve. If the ILWU's finances are weakened to the
>extent that it impacts the Union Strike Fund, it could undermine worker
>cohesion for a strike. The administration also could seek to demonize the
>unions as "unpatriotic" if they were to start a strike in advance of an
>attack on Iraq.

> Finally, perhaps the most serious pressure that the administration can
>impose on the unions is the threat to take over the port operations with
>military personnel, as a matter of national security. With congressional
>approval for military action on Iraq and the stream of warnings that
>extremists could target U.S. ports, the administration would not have a
>difficult time making its case. Suddenly the union could be faced with
>extinction and the dockworkers with the loss of their $80,000-a-year jobs.

> Nevertheless, the union could decide to call Washington's bluff and
>strike. If it does, then the onus will fall on the U.S. Navy, which has
>some capacity for port operations considering the number of naval ports
>that handle all kinds of cargo. The Navy also has jurisdiction to take over
>operations of four "strategic seaports" on the West Coast, including Long
>Beach, San Diego, Oakland and Tacoma.

> Specifically, the job might fall to the Military Sealift Command, a
>government-owned, civilian-crewed merchant marine fleet that operates
>vessels used in major military deployments. The MSC would have to be beefed
>up drastically in terms of personnel -- the vast majority of its 7,500
>personnel are seagoing -- and funding. 

> However, there are serious questions as to whether the Navy (which should
>be otherwise occupied in January and February with a buildup in Iraq), the
>MSC or any other government agency would be able to fill the gap left by
>10,500 skilled union workers. Currently, there are around 5,000 non-union
>"casual" dockworkers on the West Coast that possibly could be tapped, but
>the learning curve could be tremendous, and the productivity slowdown would
>remain substantial. That would affect not only deployments of military
>cargo for a war in Iraq but also the $300 billion worth of goods that
>annually pass through West Coast ports.

> Taft-Hartley forces union members to vote on management's "last, best and
>final" offer. That offer will come sometime before the cool-down period
>ends Dec. 28. Until then, the administration will make this case to both
>sides -- with all relevant threats -- that an extended crisis on the docks
>is not in the interest of the union, the shippers or the country in
>general. Mutual fear of such an outcome may be the best thing that the
>current negotiations have going for them. 


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