Looming Port Strike Threatens to Raise Prices Just In Time for Election Day

The likely first national strike of maritime workers in nearly 50 years couldn’t have come at a more critical time.

With the economy still a top concern for inflation-weary voters, experts warn that a dockworkers’ strike set to initiate at midnight Monday could have significant implications on a coin-toss presidential race, especially given its potential to disrupt supply chains and impact consumer prices.

The strike involves tens of thousands of longshoremen at East and Gulf Coast ports, stretching from Maine to Miami. These ports handle over half of U.S. container imports, moving everything from auto parts and electronics to food and furniture.

At the center of the dispute between the International Longshoremen’s Association (ILA) and the U.S. Maritime Alliance (USMX) are two key issues: stronger protections against automation and higher wages.

Even if the port workers’ strike lasts only a few days or up to a week, experts consulted by Newsweek say it could have serious consequences for Vice President Kamala Harris in her race against former President Donald Trump.

A strike also puts President Joe Biden‘s pro-labor stance in the spotlight at a critical time.

The East and Gulf Coast ports handle a majority of U.S. container imports, including essential goods like auto parts, appliances, electronics and food. If the strike is resolved quickly, its economic impact may be contained, according to experts. However, a prolonged strike could cause major disruptions, leading to shortages in key sectors and driving up prices that would be felt on a lag that happens to correspond almost exactly with the final leg of the race.

“If this is settled in a couple of days, the impact will be minimal,” said Peter S. Goodman, supply chain expert and author of How the World Ran Out of Everything. “But if it drags on for weeks, then you have a potentially very significant problem.” He explained that beyond finished goods, the strike could delay components that are essential for the U.S. manufacturing sector, be it cars, chemicals or construction materials.

The price of bulky goods like furniture is particularly sensitive to shipping disruptions. “Big, bulky items like furniture are hit harder because fewer items fit in a container, driving up the per-item cost,” said Ryan Petersen, CEO of the tech-centered logistics company Flexport. However, he says, the full impact may take longer to be felt.

In contrast, fresh produce, such as bananas from Central and South America, would face more immediate risks due to spoilage during transit delays.

“Fresh fruits and vegetables, especially those coming through these ports, will be impacted quickly,” noted Margaret Kidd, a supply chain professor at the University of Houston, adding that 75 percent of the nation’s imported bananas arrive through East and Gulf Coast ports.

Americans could also face higher prices and delays as retailers experience a supply squeeze — a phenomenon familiar for anyone who tried to buy a couch on the internet during the pandemic.

“If the strikes go ahead, they will cause enormous delays across the supply chain, creating a ripple effect that could last into 2025 and cause chaos in the industry,” said Jay Dhokia, founder of supply chain management firm Pro3PL.

The potential strike underscores the vulnerabilities that linger in the U.S. supply chain, despite changes made to shore up supply lines and logistics after the worst of the pandemic.

Retailers have tried to prepare by front-loading inventory ahead of the holiday shopping season.

“Many retailers have already taken steps to mitigate the potential impact of a strike by bringing in products earlier or shifting shipments to the West Coast,” Jonathan Gold, Vice President of Supply Chain and Customs Policy at the National Retail Federation (NRF), told Newsweek. “But even a minor disruption would have a negative impact, causing delays at a critical time for both retailers and consumers.”

“One lesson we learned from COVID is the importance of better visibility and planning in the supply chain,” Flexport’s Petersen said. “Companies need better tools to track shipments and plan for disruptions.”

Biden’s Dilemma

The coming strike by ILA workers will be the union’s first since 1977. Its timing, just weeks before the election, presents a political dilemma for President Biden.

The administration has the power to intervene under the Taft-Hartley Act, imposing an 80-day cooling-off period that would delay the strike conveniently until after Election Day. However, such a move carries political risks, especially for Vice President Harris.

Biden has crafted himself into the most pro-labor president in decades, and intervening could anger the dockworkers and other unions, a crucial part of his political base that Donald Trump is also making a play for.

“Biden has positioned himself as friendly to labor, and using powers like the Taft-Hartley Act to end the strike could anger organized labor,” Goodman explained. However, a prolonged strike that disrupts supply chains and fuels a spike in inflation before Nov. 5 could prove to be even more politically dangerous.

The strike comes at a time when inflation, although nearly back to its Fed target of 2 percent, remains a major concern for voters. Prolonged disruptions at ports could raise prices for key goods heading into the busiest shopping season of the year, just in time to remind voters of one of things they disliked most about the last four years.

“Trump could benefit, claiming he would handle things better, while Harris, as the incumbent administration’s candidate, could face backlash over inflation and supply chain issues,” Kidd said.

“If the strike drags on, we’ll definitely see short-term inflation, and consumers will feel it.”