Crypto News: Supply Lines: Biden’s no-win situation

With less than 24 hours before US dockworkers plan to strike at ports on the East and Gulf coasts, one of the big questions is whether the White House will use its authority to prevent a work stoppage and force the opposing sides back to the negotiating table.

"If you had asked me a month ago, I had believed that the Biden administration was going to force a cooling-off period for 80 days, but we've seen recent reports where they've said that they're not going to do that," Craig Fuller, the founder and CEO of FreightWaves, told Bloomberg's Odd Lots podcast.

"But this is an election season in a very contested election and it's really a no-win situation for the Biden administration or the Democrats," he said.

In other words, if the Biden administration sides with the union's demands, it'll face the economic risks from a prolonged strike — including supply disruptions and inflationary flareups just before the holidays.

The alternative isn't good either: side with the ocean carriers and take the politically dicey position of favoring foreign-owned companies that have made record profits amid a series of trade disruptions over the past four years.

President Joe Biden said Sunday he wouldn't intervene in any dockworkers strike. Resolving the dispute is a matter for collective bargaining, he told reporters in Delaware.

Work Slowdown

But even federal intervention under the Taft-Hartley Act might not ensure supply chains function smoothly.

"The question is, if you make people who don't want to go back to work, how hard are they actually going to work?," Fuller said. "That's the big concern — yes, you can force them for at least 80 days to cool off, you can force them into effectively a mediation and arbitration environment, but you can't force them to work if they are called back in."

Fuller said a strike could be "potentially catastrophic to supply chains if it goes on for a long period of time."

According to a statement released over the weekend by Business Roundtable CEO Joshua Bolten, "a port strike could cost the U.S. economy billions of dollars a day, hurting American businesses, workers and consumers across the country."

It won't be long before it's clear whether the strike is going ahead at midnight tonight. In a statement released Sunday, the International Longshoremen's Association said it will provide an update on any new developments on Monday by 11 a.m. New York time.

Follow more of the developments here on Bloomberg.com.

Related Reading:

—Brendan Murray in London

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