President Biden said the agreement reached between railroad companies and union negotiators early Thursday morning averted a “real economic crisis.”
The agreement between the two sides came just before the deadline on Friday morning to avoid a strike at the rail freight company.
“The alternative was simply unthinkable,” said Biden. “If they had actually gone on strike, the supply chains in this country would have come to a standstill. We would have experienced a real economic crisis.”
Biden made the comments during an interview with CBS’ 60 Minutes, which aired Sunday.
The deal, reached early Thursday morning, offers railroad workers a 24% wage increase over five years from 2020 to 2024, along with an average immediate payout of $11,000 upon ratification, according to the Association of American Railroads. The group said the deal was preliminary and required ratification by union members.
Biden said during the interview that both sides were able to work out a deal that was “fair” to both of them.
“One of the things that happens in negotiations, especially when they’re this long, is that people say and do things that pride also gets involved in. And it’s awfully hard to pull away from some of those things. So we just said, ‘Look, let’s take a look. Let’s see what happens.’ You got a good deal for work. Your income will increase by 24% over the next five years. They worked out health care, they worked out days off. I think they both sat down, and they were in the office today and they were like, ‘Well, we finally figured it out. That’s fair on both sides.” And it took that time to focus,” Biden said.
US Secretary of Labor Marty Walsh said after the tentative agreement was reached the two sides had negotiated for over 20 straight hours at the US Department of Labor.
“After more than 20 consecutive hours of negotiations, the railroad companies and union negotiators came to a tentative agreement that balances the needs of workers, businesses and our country’s economy,” Walsh said. “The Biden administration applauds all parties for achieving this hard-fought, mutually beneficial deal. Our rail system is an essential part of our supply chain and a disruption would have had a disastrous impact on industries, travelers and families across the country.”
A railroad workers’ strike would have had far-reaching effects on the entire US economy, with the American Association of Railroads estimating that a work stoppage could cost over $2 billion a day in lost economic output.
Amtrak announced on Wednesday as a precautionary measure that it would be canceling all long-distance trains beginning Thursday, and said it would only operate trains with enough time to reach their destinations before a potential lockdown began after midnight on Friday.
Amtrak announced on Thursday that it would offer a full schedule on Friday based on the tentative agreement.