US Business

Lawmakers in the US House of Representatives voted Wednesday to prevent a potentially catastrophic freight rail strike, stepping in to break an impasse between workers and executives during a critical pre-holiday period.

The bill effectively forces hold-out unions to accept a September deal on increased wages, which a majority of unions had already agreed to. 

The House measure — which passed with decisive bipartisan support — now moves to the Senate.

Should the bill ultimately clear Congress and reach President Joe Biden’s desk for his signature, it would avert a strike that could have cost the US economy an estimated $2 billion per day.

The Biden administration had taken a hands-on approach to the long-running deadlock over a contract between organized labor and railroads, with cabinet secretaries participating in all-night negotiations in September alongside union leaders and rail executives.

After that marathon session, leaders from the two sides announced a tentative agreement.

Since that time, members of eight of the 12 rail unions approved the deal, while four voted it down.

The agreement includes a 24 percent pay increase for workers. But critics in organized labor have slammed a lack of guaranteed paid sick time, an omission that has been seen as evidence of “unchecked corporate greed,” as one leading union put it.

The failure of the agreement to win universal approval among the unions set the stage for a potential strike on December 9, putting the White House in an awkward spot.

Biden, who has been dubbed “Union Joe” for his affinity for organized labor, called for congressional action on Monday night.

“As a proud pro-labor president, I am reluctant to override the ratification procedures and the views of those who voted against the agreement,” Biden said. 

“But in this case — where the economic impact of a shutdown would hurt millions of other working people and families — I believe Congress must use its powers to adopt this deal.”

Since Monday, at least two of the four unions that voted down the agreement have publicly criticized Biden’s stance.

The Brotherhood of Maintenance of Way Employees, part of the Teamsters, said it was “deeply disappointed” by the president’s action, while the Brotherhood of Railroad Signalmen also expressed disappointment as it encouraged the Biden administration “to stick to its pro-worker roots” and insist that guaranteed paid sick leave be included in the deal.

Both unions backed a separate resolution championed by House Democrat Donald Payne Jr. to add seven days of paid sick leave to the agreement.

Payne, in proposing the measure, described it as “about fairness” in light of the sacrifices made by rail workers and other essential workers during the pandemic.

“Without paid sick time, railroad workers are forced to make a choice between their health, or the health of their families, and their paychecks,” Payne said.

But Republican congressman Sam Graves said the existing agreement was “more than fair for rail workers” as he urged lawmakers to reject adding sick leave to the pact.

Graves said he was voting on the resolution to avert an “economically ruinous” rail strike as he blamed the Biden administration for the issue, saying it had “failed” to lead on the impasse.

Democratic lawmakers on Wednesday chose Hakeem Jeffries to succeed Nancy Pelosi as their leader in the House of Representatives, making him the first Black person to ever lead a US congressional caucus.

The 52-year-old, who has been in Democratic leadership since 2019, ran unopposed in the closed-door vote, which also saw new faces elected to the number two and three positions.

With Jeffries 30 years Pelosi’s junior, the New York congressman’s election marks a generational shift for the Democrats.

“This new generation of leaders reflects the vibrancy and diversity of our great nation,” Pelosi said in a congratulatory statement after the Wednesday vote.

Pelosi announced earlier in November she would step down from her post as leader in January, when her term as speaker of the House ends and Republicans take control of the chamber after their midterm election wins.

The 82-year-old, who was first elected as congressional party leader in 2003 and became the first woman House speaker in 2007, will stay on as representative for her northern California district.

Jeffries will become leader with his party in the minority after Democrats lost control of the lower chamber in the November 8 midterm elections, giving up their two-year total control of government. 

Even with a smaller majority than they had hoped for, Republicans will be able to use their new-found power to block President Joe Biden’s legislative agenda.

They have said they plan to initiate several investigations, including of Biden’s handling of the Covid pandemic and the United States’ withdrawal from Afghanistan.

Democrats, however, will keep control of the Senate, with a divided government meaning neither side will have a clear path to push through their legislative priorities.

France’s President Emmanuel Macron underlined US-French cooperation with a tour of NASA headquarters Wednesday, but tough talks on trade and China are expected when he meets Joe Biden for the main part of a rare state visit.

The French leader, who arrived late Tuesday with his wife Brigitte, joined Vice President Kamala Harris at the NASA facility in Washington to discuss cooperation in space.

“France is a vital ally to the United States and this visit demonstrates the strength of our partnership, our friendship…, one that is based on shared democratic principles and values,” Harris told Macron.

Macron will stay in the high-tech sphere later when he attends a meeting on civilian nuclear energy.

The busy schedule, which also includes a working lunch to discuss biodiversity and clean energy, and a visit to the historic Arlington National Cemetery, illustrates the ambitions set for the trip — the first formal state visit by a foreign leader to Washington since Biden took office nearly two years ago.

The core of the visit will be on Thursday, including a White House military honor guard, Oval Office talks with Biden, a joint press conference and a banquet where Grammy-award-winning American musician Jon Batiste will perform.

Compared to Macron’s awkward experience as the guest of Donald Trump in 2018, this trip will be a carefully choreographed display of transatlantic friendship.

– EU-US trade tensions –

Tensions, however, are rising over trade as Europeans nervously watch the rollout of Biden’s signature green industry policy — the Inflation Reduction Act.

The IRA is set to pump billions of dollars into climate-friendly technologies, with strong backing for American-made products. A similar effort is being put into microchip manufacturing.

Europeans fear an unfair US advantage in the sectors just as they are reeling from the economic consequences of the war in Ukraine and Western attempts to end reliance on Russian energy supplies.

Talk in Europe is now increasingly on whether the bloc should respond with its own subsidies and championing of homegrown products, effectively starting a trade war.

Another gripe in Europe is the high cost of US liquid natural gas exports — which have surged to help compensate for canceled Russian deliveries.

White House National Security Council spokesman John Kirby told reporters that the US side wants to defuse tensions, promising “transparent, forthright” discussions.

“We certainly will stay open to listening” to the EU concerns, he said.

– Strategizing on China, Ukraine –

The breadth of Macron’s entourage — including the foreign, defense and finance ministers, as well as business leaders and astronauts — illustrates the importance Paris has put on the visit.

At the White House, however, a senior official said the main goal is to nurture the “personal relationship, the alliance relationship” with France — and between Biden and Macron.

That more modest-sounding goal will include improving coordination on helping Ukraine to repel Russia and the even more vexing question of how to manage the rise of superpower China.

“We are not allies on the same page,” one adviser to Macron told AFP, forecasting “challenging” talks with Biden.

Despite his strong support for Kyiv, Macron’s insistence on continuing to maintain dialogue with Russian President Vladimir Putin has irked American diplomats.

The China question — with Washington pursuing a more hawkish tone and EU powers trying to find a middle ground — is unlikely to see much progress.

“Europe has since 2018 its own, unique strategy for relations with China,” tweeted French embassy spokesman Pascal Confavreux in Washington.

Kirby said China will be “very high on the agenda” this week but stressed that both countries share a broad approach.

“We believe that not only France, but every other member of the G7 — frankly, our NATO allies too — see the threats and challenges posed by China in the same way.”

Stock markets fluctuated on Wednesday as eurozone inflation slowed for the first time in 17 months and investors awaited fresh signals about the US central bank’s interest rate plans.

Markets were also buoyed by hopes that China will further ease its strict Covid containment measures following widespread protests, though gains were tempered by leaders’ warnings of a crackdown on dissent.

Traders were awaiting a key speech by Federal Reserve chief Jerome Powell, with many expecting him to outline plans for future interest rate hikes to tackle high US consumer prices.

“Will he adopt a more hawkish-minded tone like he did after the last FOMC (Fed policy) meeting or will he have a less hawkish tone?” said Briefing.com analyst Patrick O’Hare.

“His tone is going to move the market’s thinking with respect to the path of monetary policy,” he said.

Powell was due to speak after government data on Wednesday showed that the US economy grew more than initially reported in the third quarter, reflecting upward revisions to retail spending and some forms of investment.

London, Paris and Frankfurt closed in the green, but the Down Jones lost around 0.4 percent.

Eurozone inflation eased to 10 percent in November, the first drop in 17 months, according to official data.

But this may not lead to an easing of European Central Bank policy as ECB president Christine Lagarde has expressed scepticism that inflation has peaked.

Inflation in the bloc had hit a record 10.6 percent in October, boosted also by soaring energy and food bills in the wake of Russia’s war in Ukraine.

“Euro area inflation figures surprised on the downside, providing an early indication that the record price pressures seen in recent months may have peaked,” said CEBR economist Karl Thompson.

However, he warned that “inflation is nonetheless likely to remain elevated throughout 2023” and forecast rising rates next month.

The inflation figure was still “extraordinarily high” but offered “hope that inflation may have peaked and the deceleration could be faster than anticipated”, said Craig Erlam, senior market analyst at OANDA.

Global central banks, including the Fed, have ramped up borrowing costs this year in a bid to dampen red-hot inflation that was fuelled also as economies reopened from the pandemic.

– ‘Intensifying headwinds’ –

In Asia, stocks mostly rebounded as investors looked past weekend demonstrations in China after officials announced moves aimed at softening the zero-Covid strategy.

But in a sign that the leadership was determined to maintain its authority, the country’s top security body called for a “crackdown” against “hostile forces”.

New clashes broke out in China’s southern city of Guangzhou on Tuesday night and into Wednesday, according to witnesses and social media footage verified by AFP.

Data showing China’s factory activity shrank further in November underscored the impact the zero-Covid approach has had on the world’s second-biggest economy.

“The headwinds facing China are intensifying and the protests of recent days could make it even more challenging to navigate… Even the best-case scenario is one of significant turbulence,” added Erlam.

Elsewhere, oil prices jumped by around three percent, with the international benchmark, Brent, reaching almost $87 per barrel.

– Key figures around 1630 GMT –

New York – Dow: DOWN 0.4 percent at 33,717.64 points

London – FTSE 100: UP 1.0 percent at 7,587.51 (close)

Frankfurt – DAX: UP 0.3 percent at 14,397.04 (close)

Paris – CAC 40: UP 1.0 percent at 6,738.55 (close)

EURO STOXX 50: UP 0.8 percent at 3,964.72

Tokyo – Nikkei 225: DOWN 0.2 percent at 27,968.99 (close)

Hong Kong – Hang Seng Index: UP 2.2 percent at 18,597.23 (close)

Shanghai – Composite: UP 0.1 percent at 3,151.34 (close)

Euro/dollar: DOWN at $1.0318 from $1.0330 on Tuesday

Dollar/yen: UP at 139.36 yen from 138.63 yen

Pound/dollar: DOWN at $1.1937 from $1.1952

Euro/pound: UP at 86.43 pence from 86.42 pence

Brent North Sea crude: UP 3.1 percent at $86.82 per barrel

West Texas Intermediate: UP 3.0 percent at $80.51 per barrel

A godmother of Prince William quit the royal household on Wednesday and apologised for repeatedly asking a black British woman where she was “really” from, plunging Buckingham Palace into a fresh racism row.

Susan Hussey’s resignation came just as William and his wife Kate made their first visit to the United States in eight years and after racism claims from his brother Harry and mixed-race sister-in-law, Meghan.

In Boston, a spokesman for the royal couple told reporters: “Racism has no place in our society.

“These comments were unacceptable, and it’s right that the individual has stepped aside with immediate effect.”

William was not involved in the decision but “believes it’s the right course of action to be taken”, the spokesman added.

“He won’t be commenting further.”

Hussey, 83, is a longstanding former lady-in-waiting to William’s late grandmother, queen Elizabeth II and was a courtier to Queen Consort Camilla. She is one of William’s six godparents.

Ngozi Fulani, the chief executive of the London-based Sistah Space group which campaigns for survivors of domestic abuse, said the comments came as she attended a palace reception on Tuesday.

Asked where she was from, Fulani said Hackney, northeast London, prompting the woman whom she identified only as “Lady SH” to ask: “No, what part of Africa are you from?”

Fulani said she was born and raised in the UK and was British but the woman persisted.

“Where do you really come from, where do your people come from?… When did you first come here?” she was asked.

Fulani repeated that she was a British national born in the UK and was forced to say she was “of African heritage, Caribbean descent”.

The exchange, she wrote on Twitter, left her with “mixed feelings” about the reception, which was hosted by Camilla to highlight violence against women and girls.

Women’s Equality Party leader Mandu Reid, who witnessed the exchange, called it “grim” and like an “interrogation”.

She said it felt as if they were “not being treated as if we belong” or “as if we are British”.

– ‘Unacceptable’ –

Buckingham Palace said it took the incident “extremely seriously” and called the comments “unacceptable and deeply regrettable”.

“We have reached out to Ngozi Fulani on this matter, and are inviting her to discuss all elements of her experience in person if she wishes,” a statement read.

“In the meantime, the individual concerned would like to express her profound apologies for the hurt caused and has stepped aside from her honorary role with immediate effect.

“All members of the Household are being reminded of the diversity and inclusivity policies which they are required to uphold at all times.”

British media outlets all quoted palace sources as confirming it was Hussey who made the remarks.

As lady-in-waiting to the queen, Hussey was described as one of the late monarch’s most trusted aides. 

Camilla has scrapped the formal roles of ladies in waiting, but Hussey, whose late husband was a former BBC chairman, was kept on as a royal retainer by King Charles III.

– East Coast rivalry –

William and Kate are on a three-day visit to Boston, where Charles’s heir will award the Earthshot Prize for initiatives to tackle climate change.

Last year, William insisted “we are very much not a racist family”, after Harry and Meghan alleged that an unidentified royal had asked what colour skin their baby would have.

William has since praised the “immense contribution” of the “Windrush” generation of Caribbean migrants, who helped Britain to rebuild after World War II.

Despite arriving legally, many were later wrongly detained and even deported under the Conservative government’s hardline immigration policies.

As William and Kate visit Boston, Harry and Meghan are due in New York for another awards ceremony, although the feuding brothers have reportedly no plans to meet.

Harry and Meghan quit royal life in early 2020 and moved to California, winning many fans among younger people and in the black community for taking on the British establishment.

The UK media, though, has repeatedly accused them of exaggerating their unhappy plight as members of the royal family but the couple may point to the latest allegations as vindication.

The palace was earlier this year accused of being tone deaf to calls from Caribbean countries which still have Charles as head of state to acknowledge Britain’s past role in slavery.

William and Kate’s visit to Jamaica was also criticised for smacking of colonialism.