The International Longshoremen’s Association went on strike as of midnight in the first major port strike in the United States in decades. Twenty years ago, dock workers on the West Coast struck for eleven days. The ILA has not gone on a strike since 1977, so this is a historic event for that reason alone. If the strike lasts more than a few weeks, then it will be much more than a historical event. About half of the cargo that goes in and out of the country flows through the affected ports.
The bankers estimate that the strike will cost the economy five billion per day, but that is a number plucked from the air. What we learned from the Covid fiasco is that American supply chains are extremely fragile, so any interruption will have unpredictable long-term consequences to the economy. This is also when consumer goods for the Christmas season begin flowing into the country, so delays will result in shortages which will disrupt the biggest retail period of the year.
One of the first things that will happen is conservatives will be told by conservative media to blame the dock workers. The reason for this is conservatives are idiots who do what they are told by the people they claim to oppose. The regime would like to turn this into a problem for Trump if possible, so they are busy filling the teleprompters of Fox News with squirrely rants about the greedy union guys. The vegetables that consume that slop will then regurgitate it on social media.
The fact of the matter is there are no good guys or bad guys when it comes to the strike itself, but the port system is an indictment of the economy. There is no reason for one company to control ports up and down the coast. Ports should be controlled by the states and encouraged to compete with one another for cargo. This makes for better port operations and eliminates the prospect of a crippling port strike. It also encourages modernization and efficiency at the ports.
The reason this is not the case is our ports are primarily skimming operations, rather than a part of a manufacturing and export base. What America primarily exports does not require seagoing vessels. Transgenderism, homosexual pride parades and cultural subversion are shipped around the world on the back of the dollar. What comes back are container ships full of consumer goods. A collection of people then skim a little from each container that reaches an American port.
This gets to why the dock workers are striking. They want protection from automation that will eliminate jobs. This will strike most people as nuts as they have been conditioned to think automation is a good thing, because that is what the television has told them, but in reality, most automation is about socializing the costs of business and privatizing the profits. Automating the ports will not result in lower consumer prices, but it will make the port operators richer.
If the point of the American economy were to make things and then sell them around the world, the ports could never be allowed to function as they do today because it would interfere with selling things around the world. That is not the point of the American economy, so the main function of ports is to skim from imports. This is why one main operator controls the East Coast ports. Consolidation makes it easier to institutionalize the skim.
None of this is to suggest that the dock workers are victims. Senior members of the ILA make four and five times what the typical American earns. Most of the guys on strike make six figures plus very generous benefit programs. The reason it is impossible to get a job at the ports is they control the labor force, which means they only allow friends and family to get jobs when they come open. The docks are pretty much a government created medieval guild system.
That is the other thing about the ports. The labor situation is a creation of the federal government over the last half century. In the middle of the last century, the mafia got control of the union pensions and immediately looted them. This brought in the feds who eventually restructured the union, so it was free of gangsters in track suits, but was filled with gangsters from the government. Both sides of the current contract dispute are the result of decades of government management.
Of course, there is a political angle to this. The Biden admin has done nothing to prevent the strike, which is interesting as they moved heaven and earth to head off the rail strike last year. That was when Biden thought he was going to be allowed to run for a second term. Now that he is drifting off into retirement, no one in the admin can be bothered to work on anything other than Ukraine and Israel. Kamala will be left to deal with the politics of a port strike.
This is where things get interesting. Pennsylvania and Michigan are union states, so the white remnant will be watching this strike. These are people who have always voted Democrat for economic reasons but detest the other stuff from the party. They like Trump, but wisely distrust Republicans. There is an opening for Trump the deal maker to take the union side without pandering. Harris, on the other hand, does not have any good options on this one.
In a way, the ports are a good model for our ruling class. Everyone involved in the ports is doing well, better than they should expect, but everyone involved in the ports is sure the system is screwing him. That is because the ports exist in isolation from the rest of the economy. It is a world unto itself that only interfaces with the rest of society, rather than operate within the economy. It is how high-earning people on both sides of this strike can think they are the little guy.
Another reason for this is the bottleneck mentality. Ports are a bottleneck and everything that passes through is taxed. In this way, the ports are just like our banking system or the information system. That means the real competition is over how much you get to tax what passes through the bottleneck. To the people inside a bottleneck system, it always feels like it is a zero-sum game, and their slice of the overall pie is never the biggest slice of that pie.
In the end, the union will get what they want as there is no real reason to not give them what they want. Their cost just gets tacked onto the cost of goods that flow through the port to your local Walmart of Amazon distribution center. Just like those Walmart’s and Amazons, the cost of the ports are socialized. With no fear of competition, there is no concern for the profit margin. You get to pay more for stuff, so the dock worker and his manager get to go boat shopping this spring.
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