On The Money — Rail strike looms over midterms, economy
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The federal government has just about two weeks to avert a nationwide freight rail strike with serious implications for the country. We’ll also look at a looming funding deadline for the federal government and the side deal hinging on a shutdown countdown.
But first, we bring you up to speed on the California heat wave.
Welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. For The Hill, we’re Sylvan Lane, Aris Folley and Karl Evers-Hillstrom.
Potential rail strike threatens US economy
A potential nationwide freight rail strike is looming, threatening to cripple the U.S. economy ahead of the holiday shopping season and November’s midterm elections.
Roughly 115,000 rail workers could walk off the job as soon as Sept. 16 if they cannot agree to a new contract with railroads.
That’s the first day workers could legally strike after a White House-appointed panel released collective bargaining recommendations aimed at ending years of contentious negotiations.
While five unions have reached tentative agreements to implement the Presidential Emergency Board (PEB) recommendations, which call for 24 percent pay raises, most have not yet struck a deal.
It’s also unclear whether workers would vote to ratify a contract that doesn’t address their concerns about punishing hours and rigid schedules.
A recent survey found that more than 9 in 10 railroad workers would vote to reject the PEB recommendations and go on strike.
The Association of American Railroads estimates that a national rail shutdown would cost the U.S. at least $2 billion a day. Experts say that it would devastate the nation’s agricultural and energy industries and severely clog up supply chains.
Congress will likely step in: If workers were to strike, federal law empowers Congress to block or delay the walkout, taking away railroad workers’ only real source of leverage. But it’s not totally clear how lawmakers would approach the issue, which they haven’t tackled in 30 years.
Karl has the details here.
SIDE QUEST
Schumer pledges to pass Manchin deal despite Democratic opposition
Senate Majority Leader Charles Schumer (D-N.Y.) promised on Wednesday to pass a side deal on permitting reform with Sen. Joe Manchin (D-W.Va.) to the massive tax, climate and health care bill despite growing opposition from progressive House Democrats.
Schumer said he will put permitting reform legislation that would speed the development of fossil fuel and other energy projects in the stopgap spending measure Congress needs to pass to keep the federal government funded beyond Sept. 30.
“Our intention is to add it to the CR,” Schumer told reporters Wednesday, referring to the short-term continuing resolution to fund the government, which he said must get passed this month.
The decision will make it tougher for House progressives, who feel little obligation to help Manchin pass one of his top energy development priorities, to block it.
The Hill’s Alexander Bolton explains why.
ANOTHER CR?
Congress confronts funding deadline
Congress is staring down a critical stretch of time to cinch a funding bill to prevent a government shutdown before September comes to a close.
Lawmakers are already armed with a list of political landmines they have to carefully navigate — from an energy permitting proposal to Ukraine and COVID-19 funding — or risk blowing past the Sept. 30 deadline.
One issue that could stand in the way of a government funding bill has to do with a fast-tracking federal energy permitting agreement struck with Manchin.
A potential standoff could come in the form of Democratic leaders in the House facing pressure from liberals who are demanding the permitting agreement be kept out of a CR.
It’s also not a guarantee that enough Senate Republicans would support its inclusion.
Aris has more here.
GREEN SCREEN
Fed vice chair says bank will launch pilot climate risk analysis next year
The Federal Reserve’s top regulatory watchdog said Wednesday the bank will test out ways next year to help financial firms figure out the risks they face from climate change and climate-related events.
Fed Vice Chair of Supervision Michael Barr said in a Wednesday speech the bank will launch a pilot exercise next year for the major banks it supervises to help get a better sense of the risks climate change poses to the financial system.
The exercise would likely require firms to explain how several different climate-related financial shocks would affect their books and ability to serve customers.
As vice chair of supervision, Barr spearheads the Fed’s oversight of major financial firms, including the Fed’s annual stress testing of the largest U.S. banks.
“The Federal Reserve’s mandate in this area is important, but narrow, focused on our supervisory responsibilities and our role in promoting a safe and stable financial system,” Barr said.
Sylvan has more here.
Good to Know
Treasury Secretary Janet Yellen will call out the fossil fuel industry in a Thursday speech on the Biden administration’s economic agenda to be delivered in Detroit, Mich., where oil and gas companies have long held influence in the U.S. auto manufacturing sector.
Here’s what else we have our eye on:
A majority of Americans in a new Gallup poll said that inflation-driven price increases are causing moderate or severe financial hardship.
Sen. Amy Klobuchar (D-Minn.) said the push to pass her antitrust legislation targeting the largest tech companies isn’t dead, despite the bill still waiting for a scheduled floor vote.
That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you tomorrow.
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