Joe Biden recently tried to clarify the meaning of “Bidenomics,” however the word salad offered by our half-coherent president on his economic philosophy was hard to decipher. Good thing you don’t need to take heed to Sleepy Joe to grasp the concept; you’ll be able to just refer to some average Americans.
They see Bidenomics as something more sinister — taxes, spending, business-strangulating regulations; stuff that causes sticky inflation. Despite Fed rate hikes, it won’t go away and it makes seemingly strong top-line economic numbers feel recessionary. Biden polls terribly on economic issues for the easy reason that folks hate the proven fact that they need to work harder to place food on the table and refill their cars with gas.
Bidenomics can be about picking winners and losers within the economy — and putting possibly 30,000 average Americans out of labor for the sake of cozying up with the president’s union buddies on the International Brotherhood of Teamsters. In the event you don’t imagine me, consider the sorry spectacle surrounding a trucking company named Yellow, and its slow walk into oblivion because Sleepy Joe doesn’t need to piss off a union whose support he must shore up because the 2024 election approaches.
The Teamsters and its lefty president, Sean O’Brien, are in battle mode. They’re threatening to go to war with UPS, the unionized package-shipping giant, unless the corporate makes significant concessions for a recent contract. Which means 340,000 unionized staff who help deliver 20 million pieces a day could go on strike this month.
Speak about supply-chain problems.
Joe Biden is running a campaign on Bidenomics. REUTERS
O’Brien is waging an identical and, for my money, more dangerous battle with Yellow. O’Brien is now literally threatening Yellow with extinction by blocking a much-needed restructuring plan that doesn’t eliminate jobs, but does force union drivers to do stuff like load trucks. This trivial concession, the Teamsters are saying, will one way or the other cannibalize the corporate’s union workforce, which seems insane unless you think about the union’s and the White House’s broader goals.
Yellow has been around in a single form or one other since 1924. Its core business is referred to as the Less Than Truckload, or LTL, which involves transporting multiple smaller loads to different customers. It’s a distinct segment business, about $60 billion in size. It’s also hyper-competitive and, without modernization, an unimaginable one to compete at.
That is one big reason why Yellow is on the verge of going out of business. It’s been losing money, a lot of it. The corporate will likely be liquidated — tens of 1000’s of jobs up in smoke — in the approaching weeks unless some deal is reached with the Teamsters to scale back costs and modernize its operations.
Yellow believes it may well achieve these cost savings without layoffs however it needs the Teamsters to purchase into the deal. Again, with no deal the corporate is toast. Don’t take the corporate’s word for it; the market is saying as much. Amid the impasse (Yellow just sued the Teamsters to pressure them to the table), shares trade at what’s referred to as distressed levels — 86 cents and possibly heading lower.
Yellow has almost gone out of business several times over time, most recently throughout the COVID lockdowns when it received a bailout from the Trump administration to remain afloat. Some people imagine it’s just crying wolf to force the union to offer back stuff like wage increases it extracted during previous dustups.
Yellow employs more unionized truckers than any company apart from UPS, a key voting demo for Democrats. Getty Images
Proxy war
However the numbers suggest the corporate’s bankruptcy fears are real. Meanwhile, evidence is growing that O’Brien is using Yellow as a proxy in his war with a much bigger, more lucrative foe, UPS. If he can prove to UPS he’s willing to play hardball with Yellow — even killing the corporate — UPS might cave and conform to union demands on salary and more, industry observers say. A piece stoppage won’t put UPS out of business, but the specter of an extended strike from a proven, determined enemy will surely be bad for business given the uncertain economy.
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The people at Yellow also imagine Sleepy Joe & Co. are partners in O’Brien’s plan. Consider: In consequence of the Trump bailout, the Biden Treasury now holds about 30% of the corporate’s stock and it’s owed tons of of hundreds of thousands in debt. Yellow employs more unionized truckers than any company apart from UPS, a key voting demo for Democrats.
Logically, it is smart for Sleepy Joe and his peeps to inform the Teamsters they should cut some deal. But after making some half-ass efforts at facilitating a truce, Yellow says it’s been radio silence from the White House on this matter.
It’s easy to see how the political types around Sleepy Joe are in cahoots with the Teamsters because they each have greater union business to do by crushing the much larger foe in UPS.
It’s all very cynical if true — Yellow isn’t exactly small-fry. If it imploded, 30,000 jobs, 22,000 of that are unionized, would evaporate. These are good, blue-collar jobs, paying $39.95 an hour in salary and advantages, the corporate tells me.
If that does occur, you’ll be able to chalk it as much as Bidenomics — the one which Sleepy Joe won’t fess as much as while stumbling through one in all his half-coherent teleprompter-read speeches touting an economy that continues to strangle middle America.
Reps for the Teamsters and the Treasury didn’t return calls for comment.
