Florida Gov. Rick Scott appealed to President Barack Obama Thursday to use his authority to halt a potentially devastating longshoreman’s work stoppage that could cripple ports along the eastern seaboard and Gulf Coast.
On a conference call from Tallahassee with most of the state’s port directors, Scott asked the president to invoke the seldom-used Taft-Hartley Act to stop thousands of longshoremen — many who operate the giant gantry cranes that tower over the ports — from walking out on their jobs after midnight Saturday.
The governor said a walkout would indirectly affect 550,000 jobs statewide and would cut into more than $66 billion in economic activity at Florida’s ports.
“Our message to President Obama is simple — a shutdown of Florida ports is simply not an option,” said Scott.
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The International Longshoreman’s Association has said it will halt activity this weekend if the U.S. Maritime Alliance does not back off its demand that royalties, or bonuses paid to its 14,650 workers for every container they load, are cut or done away with. Those royalties in many instances come to about half of a longshoreman’s salary, which is typically around $50,000 a year.
Taft-Hartley, which was last invoked by President George W. Bush in 2002 during a crippling West Coast strike, mandates an 80-day cooling off period, and mediation. The two sides had been negotiating a new contract since March, until talks broke off Dec. 18. At the pushing of a federal mediator, the sides agreed to resume talks this week, though little has leaked out about how the talks are going, or even if the sides have come face-to-face.
Strikes are expected at 15 ports across the nation, from New York and New Jersey, down the eastern coast through Florida, and on up into the Gulf Coast from Tampa to Houston. The cruise industry is not expected to be affected.
Thursday, with leaders from six Florida ports in tow, Scott said he had not heard back from the president since an initial request last week that the president use all his power to stop the looming strike. A port strike has become a critical issue for Scott, who campaigned on bringing down skyrocketing unemployment, and who said Thursday that statewide employment levels have reached a four-year low.
The governor said the state has invested $421 million since his inauguration into ports that primarily do trade with South and Central America.
“It’s such a vital part of the job market,” he said.
Meanwhile, the Associated Press reported that Obama Spokesman Matt Lehrich said the White House was monitoring the situation and is urging the parties to “continue their work at the negotiating table to get a deal done as quickly as possible.”
Bill Johnson, who directs PortMiami, said a work stoppage could be devastating to the entire U.S. economy. His port, he noted, is the second largest generator of wealth and jobs in South Florida. He said 90 percent of the nation’s consumer goods come through the nation’s ports. PortMiami alone does about $18 billion a year in container business.
“You would start to see within a number of days products disappearing from shelves,” said Johnson.
Port Everglades CEO Steven Cernak noted that petroleum, which has a large distribution operation at his port, would not be affected. He said he remains “cautiously optimistic.”
A strike would be more harmful to PortMiami than to Port Everglades. PortMiami does almost $20 billion a year in container activity, which makes up about 40 percent of the ports business. Hundreds of longshoremen work in PortMiami for giant container transport companies like Maersk and Mediterranean Shipping Company. Only two container transport companies in Broward use longshoremen.
A strike, however, wouldn’t completely paralyze the nation.
A memo last week from the ILA said the only items likely to be affected by a strike are some frozen goods and non-perishables like clothing. Union members are still expected to ship items such as fresh fish and flowers, military cargo, and mail.
One of the louder voices in the struggle has been the National Retail Federation. Jonathan Gold, vice president of Supply Chain and Customs Police for the federation told CNBC earlier this week that the 2002 West Coast strike cost the U.S. $1 billion a day in economic activity, and that it took more than six months to recover.
Paul Anderson, who recently left his post at chief executive at JaxPort to become chief executive of Tampa’s Port Authority, noted that 34,000 containers pass through Florida’s ports each week, distributed to or from more than 60 ships. He feared a strike could lead to a national tipping point.
“A strike this Saturday,” said Anderson, “combined with the fiscal cliff negotiations, could be a one-two punch to our nation’s economy.”