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Biden administration makes case for quick Senate vote to avoid rail shutdown

The Biden administration on Thursday urged the U.S. Senate to quickly pass a bill to block a potentially crippling railroad strike, warning that the impact could be felt within days.

The U.S. House of Representatives on Wednesday voted to approve a bill to impose a tentative contract deal reached in September on a dozen unions representing 115,000 workers. The House also separately voted to require seven days of paid sick leave for rail workers, a measure the White House has not endorsed.

"There is no substitute in the American transportation system for a functioning freight rail network," Transportation Secretary Pete Buttigieg told CNBC. "It wouldn't just bring down our rail system, it would really shutdown our economy."

Buttigieg and Labor Secretary Marty Walsh are set to meet with Senate Democrats later on Thursday to try to convince them to move quickly.

Senate Majority Leader Chuck Schumer has not yet scheduled a vote on the rail measure and some senators, including Bernie Sanders, have demanded a separate vote on the sick leave issue as a condition of agreeing to fast-track consideration of the rail contract vote. Schumer said he wants to see paid sick leave included in the legislation.

"Senators are working morning, noon and night to reach an agreement for us to act on this measure ASAP," Schumer said. "The Senate cannot leave until we get the job done."

Workers could go on strike as soon as Dec. 9, but the impacts would be felt as soon as this weekend as railroads stop accepting hazardous materials shipments.

A rail strike could freeze almost 30% of U.S. cargo shipments by weight, stoke already surging inflation and cost the American economy as much as $2 billion per day, and strand millions of passenger railroad Amtrak and commuter rail passengers.

Railroads and the U.S. Chamber of Commerce oppose amending the contract deal that was struck in September largely on the recommendations of an emergency board appointed by Biden.

President Joe Biden on Monday praised the proposed contract that includes a 24% compounded pay increase over five years and five annual $1,000 lump-sum payments, and had asked Congress to impose the agreement without any modifications.

There are no paid short-term sick days under the tentative deal after unions asked for 15 and railroads settled on one personal day.

The contracts cover workers at carriers including Union Pacific UNP, Berkshire Hathaway Inc's BRK.A BNSF, CSX CSX, Norfolk Southern Corp NSC and Kansas City Southern.

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