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By Marc Levinson
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Should government even try to settle rail strikes?
Even with a scorecard, the action was hard to follow. Railroad executives, who usually want the free market to rule, implored the government to halt a nation wide strike last week. Union leaders, in a reversal of their own, begged Washington to keep its hands off. Transportation Secretary Samuel Skinner, who two years ago blocked legislation to end a strike at Eastern Air Lines, demanded that Congress order rail employees back to work. And so President Bush was awakened at 1:39 a.m. Thursday to sign a law ending the 18-hour stoppage--handing management of the nation's most heavily unionized industry an unprecedented victory.
The episode was all too familiar. Since 1926, when it passed a law to inhibit strikes in the industry, Congress has been intimately involved in rail negotiations. That used to make sense: a two-day strike in 1946 forced cancellation of 80,000 trains and set off a nationwide panic. Today most travelers fly or drive, and shippers can meet most needs with trucks. While Skinner warned of an economic catastrophe, another highranking administration official admitted such forecasts were hyperbole. But old railroad habits die hard. "The bargainers have never been confronted with the need to bargain to a complete settlement," says University of San Diego law professor Charles Rehmus. "One of them or the other can rely on Congress intervening."
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So it was this time. Three years of negotiations had gone nowhere. Although rail workers haven't had a pay raise since 1988, labor law forced both sides to keep talking until government mediators declared an impasse in March 1990. Ten months later a presidential board recommended smaller wage hikes than the unions sought, rollbacks of work rules and a process making it easier to trim train crews. Three of the 11 unions settled. The others struck, knowing that Congress would step in, as it has 16 times since 1965. But leaders of the striking unions badly misjudged the politics. Congress, usually sympathetic, created a new board that is likely to impose much the same settlement that the unions rejected.
The industry was spoiling for a showdown. Although employment is down 44 percent to 296,000 since 1980 and productivity has doubled, competition from trucks is squeezing freight rates. "The trucking industry just seems to be leaner and meaner all the time," says Curtis Grimm, a University of Maryland economist. One big worry: truckers want Congress to open the interstate highways to longer and heavier trucks, which could siphon off more rail traffic.
As recently as 1989, Burlington Northern, the nation's largest carrier, threatened to bargain on its own. To keep the industry together, Michael Walsh, the former Common Cause activist who heads Union Pacific Railroad, insisted that the CEOs play a stronger role than ever before, even hiring a law firm to oversee the industry's negotiator. Walsh's boss, Union Pacific Corp. chairman Drew Lewis, was transportation secretary from 1981 to 1983 and remains a leading Republican Party figure. "He knows the political ropes, has friends in high places and was a major influence on the negotiations," contends union leader Richard Kilroy. In railroad labor relations, such things still matter far more than bargaining prowess-or willingness to endure a strike.
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