The U.S. is on the edge of a potential economic disaster as port workers prepare for a massive strike starting October 1. This strike could paralyze crucial East Coast and Gulf of Mexico ports, responsible for handling about half of America’s maritime imports.

Over 85,000 members of the International Longshoremen’s Association (ILA) are demanding wage increases and protection against automation, potentially halting operations at three dozen ports. If their demands aren’t met by the United States Maritime Alliance (USMX), the strike could disrupt supply chains and cost the U.S. economy billions each day, as reported by the Daily Caller.

Experts warn that this looming strike could have devastating effects. Peter C. Earle, senior economist at the American Institute for Economic Research, likens it to the chaos seen during the COVID-19 pandemic.

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He predicts a sharp rise in shipping costs and rampant inflation. The Federal Reserve has estimated that supply chain disruptions were responsible for 40% to 60% of the price hikes following the pandemic, particularly in sectors like energy and food. Inflation, which surged to 9.1% in 2022, may once again skyrocket, burdening American households.

ILA President Harold J. Daggett declared that his union is ready to strike if a new agreement isn’t reached. “A sleeping giant is ready to roar on Tuesday, October 1, 2024,” Daggett said, highlighting the union’s year-long preparation for this potential conflict.

Wage hikes are at the heart of negotiations, with the ILA demanding a 77% pay increase over six years, far surpassing the USMX’s offer of 40%. The ILA justifies these demands, citing inflation that has risen more than 20% since President Biden took office.

However, it’s not just wages on the table. The ILA has fiercely resisted automation at ports, which they believe threatens jobs. Earlier this year, the union walked away from negotiations after an Alabama port used auto gates to process trucks autonomously, a move that triggered backlash from the union.

George Kochanowski, CEO of logistics firm Staxxon, stated that port automation remains a major obstacle in these negotiations. He added that any concessions made to the ILA would inevitably raise shipping costs, further fueling inflation.

The strike, if it occurs, would come just before the holiday season, potentially causing shipping delays and higher costs for consumers. As Earle noted, “Even a short disruption could exacerbate an already strained holiday season,” leaving American families facing higher prices for gifts during the busiest shopping time of the year.

Meanwhile, the Biden administration is likely keeping a close eye on the situation. While they haven’t commented, labor experts predict the White House could step in to prevent a strike, as they did in 2022 to block a railroad strike by imposing a contract on rail workers.

Labor expert Sean Higgins suggested that the administration may step in at the last minute, balancing union support and broader economic concerns ahead of the upcoming election.

The USMX recently filed a charge with the National Labor Relations Board (NLRB) accusing the ILA of unfair labor practices, further complicating negotiations. As the deadline looms, all eyes are on whether a deal can be struck to avoid a major economic crisis.