A longshoremen’s strike could throw world markets

By Justin Pritchard, The Associated Press
Friday June 28, 2002

SAN FRANCISCO — With a contract deadline looming, negotiations aren’t going well between shippers and dock workers who move billions of dollars of goods each year through West Coast ports, a union official said Wednesday. 

The pessimistic comments are the first public word on the talks, which began May 13, since a self-imposed news blackout. The contract expires Monday. 

A strike, or a lockout of employees, could have deep repercussions for the world economy. 

“This is definitely unsettling. This is not what you want to hear,” said Jack Kyser, chief economist at the Los Angeles Economic Development Corp. 

International Longshore and Warehouse Union spokesman Steve Stallone said in an interview that an agreement before the July 1 deadline was possible, but negotiators have yet to delve into pivotal issues, including technological changes that shippers want to increase efficiency. 

“We’ve got a ways to go,” Stallone said. 

The association that represents shippers wants to cut health care coverage and freeze wages for three years, Stallone said. Shippers disputed those points. 

The contract between the Pacific Maritime Association and 10,500 West Coast longshoremen controls the flow of goods through all America’s 29 major Pacific ports. Last year, that trade amounted to $260 billion in cargo. 

Outside observers thought the major sticking point would be how to bring new technology to ports that are less efficient than rivals in Asia and Europe. Instead, both sides said they haven’t yet reached the key issue of modernization. 

With the ports handling goods that reach every state in the union, the implications for American businesses and consumers could be grim. 

“A contentious shutdown of the West Coast docks carries the very real risk of triggering a sudden crisis in international financial markets,” wrote Stephen S. Cohen, a regional planning professor at the University of California, Berkeley. 

Pacific Maritime Association spokesman Jack Suite said the union was mischaracterizing the talks and chided its members for breaking the news blackout. 

The association “has no interest in reducing benefits, but has made proposals which are designed to provide benefits in a more efficient and cost-effective manner and other proposals that increase the level of benefits,” Suite said. 

Stallone said the union doesn’t object to reducing employers’ health care costs — so long as that doesn’t mean a cut in benefits that the union first won at the bargaining table in the early 1960s.