Shipping executives across the region are closely watching updates on action to settle the nation’s railroad labor strife, saying anything short of intervention would be catastrophic for the nation and Memphis, one of only two U.S. cities with five Class I railroads.

“At a very high level, (President Joe) Biden has now gone to the House and said, ‘Look, you’ve got to get something together,’” said Woodson Dunavant, senior vice president at Dunavant Enterprises. “We hope Congress can push something through in order to get the rails to agree. It’s going to take an act of Congress at this point, it sounds like.”

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The U.S. House of Representatives is scheduled to vote Wednesday, Nov. 30, to enact the tentative agreement the Biden administration worked out earlier in the year. Eight of the 12 railroad unions approved that deal, which would increase pay 24% over five years, an average of $11,000 over the five-year term, going back to 2020.

The four unions that rejected the offer are pushing for larger concessions in working conditions, including more days off for medical appointments and improvements in their work schedules.

The unions are expected to honor the strike of another, which could happen as early as Dec. 9 if an agreement is not reached.

Forty percent of all freight in the United States moves by rail. Cutting off the supply, experts say, would cripple the economy and decimate the still-rebounding supply chain.

In a letter to lawmakers last week, the American Trucking Association said it would require an impossible 460,000 additional long-haul trucks every day to make up for the loss of 7,000 long-distance daily freight trains in U.S.

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More than 70% of the warehouse business at Mallory Alexander International Logistics goes by rail to major U.S. ports. Any halt in traffic would be devastating, Neely Mallory III said.

“We ship hundreds of thousands of ocean containers on the international side of our business,” he said. “Most of our business comes to Middle America, to Memphis, to Dallas, out of Memphis, out of Dallas, into and out of Chicago. All that business is dependent on the rails taking them intermodally via the East Coast or the West Coast,” he said.

A shutdown, even a short-term work stoppage, would pile freight up around the nation, Mallory said, noting that the threat of a longshoreman strike during the pandemic created massive backups.

“For every day they were out of work, it took a week to catch up. And I think with this possible rail strike, it would be equally devastating. It may be even more so because this isn’t just the West Coast, this is the East Coast and the Gulf Coast.”

The last time Congress intervened in a national rail strike was in 1992 when the International Association of Machinists walked out. Two days later, Congress passed legislation that President George Bush immediately signed.

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Congress could intercede in several ways, including enacting a deal through legislation or extend the bargaining time.

U.S. Secretary of Transportation Pete Buttigieg, in Memphis Tuesday for the formal opening of the airport’s $309 million consolidated de-icing facility, said the strike must be avoided.

“The consequences are just beyond acceptable,” he said.

Earlier in the day Tuesday, President Joe Biden again called on Congress to codify the pact despite opposition from four of the unions.

“The sooner they can do that, the more we can all be confident that things will continue into this holiday and the future in a way that is good for the economy and not put the economy at risk,” Buttigieg said.

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He expects bipartisan support on the issue in Congress, based on what he called “a very strong level of motivation to get this done.”

In the meantime, if even a short-term strike occurs, there is nothing that can be done with the millions of dollars of goods currently on railcars, Dunavant said.

“We can’t stop shipments that were down for the rail and then put them on a truck, for example. … If a strike happens, we, along with every other company in the United States, are going to be scrambling to get our products to our customers’ door.”

If Dunavant were located in Atlanta, containers going by rail could be trucked to East Coast ports in Charleston, S.C., and Savannah, Georgia, he said. But from Memphis, the equation is different.

“While it can be done, my Lord, it is expensive. And there’s just not a lot of truckers that want to get on the road and drive from Memphis to Savannah and back, especially with the hours of service regulations that the government has,” Dunavant said.

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Both Dunavant and Mallory Alexander are third-party logistics companies, shipping loads from a factory that may be overseas to customers in the U.S. and vice versa.

“We’re watching very carefully,” Dunavant said. “We’re getting alerts — as is everybody else is in our business — with what’s going on in Washington right now.

“December 9 is the drop-dead date. We’ve got a few days — a week or so. Let’s just cross our fingers and really hope that Congress can get something agreed to here.”

Kirk Tarver is vice president of Shelby Railroad Services, a company that repairs rail spurs on corporate properties across the region. If the railroads aren’t running, there is no work.

“I can assure you, this country is not going to allow the railroads to stay down. There’s no way,” he said, noting that historically, the government has intervened very quickly because the costs are too high to let a rail strike drag on.

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“There will be a good agreement. There will be something.”

U.S. Rep. Steve Cohen, a senior member of the Transportation and Infrastructure Committee, is reluctant to pass a bill forcing changes outside the union negotiating process.

“I’d like to see the parties come together and reach an agreement,” he said.

Mallory feels similarly.

“I hope that what Congress does makes people go back to the bargaining table and work with the railroads as well as the labor groups and come up with something equitable.

“I don’t think the government should force anything down either sides’ throat. But they need to go back and bargain and try to reach some agreement.”