Professor Glenn A. Okun
The Rabid Capitalist: The Big Point is a summary of a detailed note available to paid subscribers.
This week, the Wall Street Journal noted that a dockworkers’ strike called at midnight on October 1 would ignite inflation and jeopardize economic growth. The Rabid Capitalist has been covering this threat at length. Inflation and growth are at risk due to this work action.
The International Longshoremen’s Association, which represents 45,000 dockworkers from Maine to Texas, and the United States Maritime Alliance, the organization of ports and ocean carriers, appear at a genuine impasse.
The negotiation is not limited to money. The union, which rejected the offer of a forty percent wage increase, has demanded a seventy seven percent compensation hike over six years. The bigger issue is the union’s requirement for a prohibition against the installation of automation technology that would replace labor over time.
The White House has declined to use its authority under the Taft-Hartley Act to require an eighty-day cooling-off period where a strike would threaten the national health or safety. This would postpone a potential strike past election day.
This may be the October surprise. While sitting on the sidelines allows the Biden administration to take a pro-labor stance, it could jeopardize the economy’s health and a Harris presidency. White House officials have commented that the economy could withstand a short strike of up to seven days. Any strike exceeding thirty days could cause damage to the economy for the following year.
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