West Coast port talks break off

Hours after talks broke down between West Coast port workers and shipping lines, President Bush took a first step toward ordering longshoremen back onto the job Monday. Bush formed a board of inquiry to determine the impact of a dispute draining up to $2 billion a day from the U.S. economy.

The board will make a quick assessment of the economic damage and determine whether the two sides are negotiating in good faith. Its formation was required before the president can order an 80-day cooling-off period that would force longshoremen back to work. Bush has not decided whether to take that step, said White House spokesman Ari Fleischer.

Bush signed an executive order stating that "continuation of this lockout will imperil the national health and safety" and forming the panel, which must report back to the administration by Tuesday.

"Clearly, the longer this goes on, the longer the parties are incapable of reaching an agreement between themselves, the more damage it's doing to America's economy and hurting people who are wholly unrelated to events on the West Coast because they work down the assembly line, they're down the production line or the shipment line, and that's not fair," Fleischer said.

According to Robert Parry, president of the Federal Reserve Bank of San Francisco, the lockout is sapping $2 billion a day from the economy.

Barge traffic still running

Officials in Southeast Missouri say the situation has not yet affected commerce here.

Dan Overbey of the Southeast Missouri Regional Port Authority said the port in Scott City deals with barge traffic to and from New Orleans and has not been affected by the West Coast lockout.

Cape Girardeau Chamber of Commerce President John Mehner and Mitch Robinson, industrial recruiter, both said they had not heard of any ramifications from the West Coast labor disputes.

Overbey said the companies or industries that would be most affected would be the ones who get products shipped by 20- to 40-foot containers -- either by rail or truck -- from the West Coast.

The Pacific Maritime Association, which represents shipping companies and terminal operators, has locked out 10,500 members of the longshoremen's union, claiming the dockworkers engaged in a slowdown late last month.

The association ordered the lockout until the union agrees to extend a contract that expired July 1. The main issues are pensions and other benefits and whether jobs created by new technology will be unionized.

Labor talks broke off in San Francisco late Sunday night after the union rejected the latest contract proposal.

Steve Sugerman, a spokesman for the Pacific Maritime Association, said the shippers' offer "would have made their members the highest-paid blue-collar workers in America." The contract offer would have given union members an increase in pay, complete health care coverage with no premiums and no deductibles and a $1 billion increase to the union's pension plan.

Offer to reopen talks

The PMA offered to reopen the West Coast ports if the union agreed to a 90-day contract extension to finalize the new contract, Sugerman said.

A call to union president James Spinosa was not immediately returned early Monday.

Bush's decision came after days of debate within the White House. Some advisers have warned Bush that intervening in the shutdown could energize the Democratic Party's labor base weeks before the midterm elections, and that Taft-Hartley, the law that allows the president to order a cooling-off period, has a poor history of resolving labor disputes.

Others, however, say Bush can't ignore the economic implications of a prolonged shutdown, both for political and policy reasons. There also is no love lost between unions and Bush's most conservative advisers, some of whom note with disdain that some of the longshoreman earn more than $100,000 a year.

The lockout entered its second week Monday, with the number of cargo vessels stranded at West Coast docks or backing up at anchor points rising to 200. Dozens more were still en route from Asia.

Analysts and business leaders have warned the shutdown will cause a noticeable increase in plant closings, job losses and financial market turmoil.

Already, storage facilities at beef, pork and poultry processing facilities across the country are full -- crammed with produce that can't be exported.

With nowhere to move their product, plant operators were expected to begin shutting down Monday, with layoffs soon to follow, said Mary Kay Thatcher, public policy director of the American Farm Bureau Federation.

In less than two weeks, if the shutdown continues, manufacturing plants will be grinding to a halt all over the country, farmers will be up in arms, and Asian equity and currency markets could face a full blown crisis, said Steven Cohen, a University of California, Berkeley professor of regional planning.

"It's like draining a swamp. You start seeing all kinds of ugly creatures," he said.

Staff writer Bob Miller contributed to this report.

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On the Net:

International Longshore and Warehouse Union: http://www.ilwu.org/

Pacific Maritime Association: http://www.pmanet.org/