At the stroke of midnight on October 1, the International Longshoremen’s Association (ILA) began its strike, effectively shutting down the ports from Maine to Texas. This followed a disappointing negotiation process with the United States Maritime Alliance (USMX), the group representing the ports, as both sides were unable to agree on a new master contract. For months, the ILA and USMX exchanged statements back-and-forth accusing each other of refusing to negotiate in good faith and declining to meaningfully revise their respective offers. This remains unchanged even as we sit three days into a strike, with the American people and small businesses about to start feeling the pain.
Unfortunately, this strike was not surprising. The Alliance and many other shipping groups saw this coming, and we did everything we could to raise the alarm to the Biden Administration and other stakeholders. We sent letters to the Administration, spoke to officials at the Federal Maritime Commission, and reached out to Congressional offices. Still, the Biden Administration waited until the weekend before the strike to invite the negotiating parties to Washington, and the ILA and USMX remained too content to let the strike commence. There is no question that this was a preventable disaster, yet it is the American public, not the responsible parties, who are bearing the brunt of the consequences.
Business groups and shippers weren’t the only ones who saw this coming. Ocean carriers have been issuing notices and customer advisories for weeks, warning of the strike and the disruptions it will cause, including hefty surcharges ranging from a few hundred dollars to $3,000 per container. While the carriers may act like they are simply reacting to the situation like the shippers, they fail to acknowledge that they make up a large portion of USMX’s membership. They hold significant influence within the organization and share responsibility for the strike alongside the ILA. Yet, they have the audacity to claim ‘force majeure,’ a term typically reserved for uncontrollable acts of God. This was not an act of God; it was the result of a stubborn ILA and greedy ocean carriers. Nevertheless, this won’t stop them from levying as many charges as they can think of so they can profit from the very crisis they helped create.
We shouldn’t be surprised; this is right out of the ocean carrier handbook: ‘Never let a good crisis go to waste.’ They ramped up costs during the throws of the COVID-19 pandemic which made them record-setting profits off the backs of American shippers and played an integral role in causing extreme inflation. Then, they assessed countless surcharges during the start of the Red Sea disruptions, causing shipping costs to skyrocket once again. This marks the third time in four years that carriers have seen a crisis and immediately looked to how they can profit. The only difference this time is that they played a role in creating it. It’s no surprise that the carriers are willing to let this strike continue until they get what they want.
Still, USMX is not the only party at fault. The ILA has been extremely resistant to budging from its initial offer and has refused to meet with USMX to hold formal negotiations. Their President even pledged to “cripple” the American economy if he didn’t get what he wanted in a video released prior to their strike. There is gamesmanship on both sides, and the stakes are too high to let this continue.
Hurricane Helene has just ravaged the Southeastern United States, and the communities are in urgent need of supplies, including critical chemicals imported through the East and Gulf Coast. However, due to the ongoing strike, we are unable to deliver these essential materials. Chemicals needed for water treatment, food production, construction materials, pharmaceuticals, and cleaning supplies are sitting offshore, waiting to be unloaded, while communities just a few hundred miles away struggle to clean up and rebuild. The ILA and USMX need to stop blaming each other, take responsibility, and make a deal.
The Alliance has just sent a letter to the White House, urging President Biden to intervene and address the dire situation our nation is facing. This strike cannot be allowed to continue for another day. American communities, shippers, and businesses are already hurting, and we are only beginning to see the impact as the supply of critical chemicals dwindles. The Biden Administration must step in, or the ILA and USMX will continue treating this as a game while people’s well-being hangs in the balance. The American people are paying the price for their negligence.
To stay updated on the situation at the ports, visit our East and Gulf Coast Ports Strike webpage.
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