The Washington Post - USA (2021-10-27)

A16 EZ SU THE WASHINGTON POST.WEDNESDAY, OCTOBER 27 , 2021

Economy & Business

RESTAURANT INDUSTRY

McDonald’s workers

protest harassment

McDonald’s workers in 12 U.S.
cities walked off the job Tuesday
to protest what they say is a
continuing problem of sexual
harassment and violence in the
company’s stores.
Several hundred workers were
expected to participate in
Chicago, Houston, Miami,
Detroit and other cities,
according to Fight for $15 and a
Union, a labor group that
organized the strikes.
This is the fifth time since
2018 that McDonald’s workers
have struck the company over
what they say are inadequate
efforts to stop sexual harassment
in its stores. At least 50 workers
have filed charges against
McDonald’s alleging verbal and
physical harassment over the
last five years.
In April, McDonald’s
announced it would require
sexual harassment training,
reporting procedures for

complaints and annual

employee surveys at its 40,

stores worldwide starting in

January 2022.

But some workers say that’s

not enough. They want

McDonald’s, not its franchisees,

who own nearly all of its U.S.

stores, to be held accountable for

harassment in its restaurants.

— Associated Press

FOOD INDUSTRY

Big Chicken antitrust

trial begins in Denver

After years of rumors and

allegations, Big Chicken is now

on trial.

A group of 10 executives and

employees of top U.S. poultry

companies — including two

former chief executives — are

facing criminal antitrust charges

in a trial getting underway this

week in Denver. They face prison

and million-dollar fines if

convicted of fixing prices and

rigging bids over nearly a

decade.

The trial, the first to result

from a years-long investigation

in the $95 billion U.S. market for

chicken, has ensnared affiliates

of Pilgrim’s Pride and Perdue

Farms among others. Together,

the companies associated supply

about a third of the chicken

Americans eat.

The move comes as the meat

industry has been thrust into the

spotlight amid soaring prices

and after a wave of coronavirus

outbreaks at packing plants. The

Biden administration has

signaled it will act aggressively

against alleged livestock cartels,

charging that antitrust practices

have saddled consumers with

rising costs at a t ime when

inflation is increasingly

becoming a political concern.

The defendants, who have all

pleaded not guilty, are charged

with violating the Sherman Act,

a law passed in 1890 to protect

consumers and the economy.

In a c ourt filing last week, the

defendants said their price

discussions weren’t illegal and

that the government can’t prove

they agreed to participate in a

single, overarching conspiracy.

ALSO IN BUSINESS

General Motors will use its

dealership network to deploy up

to 40,000 electric vehicle

chargers across the United States

and Canada, as the veteran

automaker ramps up its shift to

plug-in models. Starting next

year, GM will give each dealer up

to 10 Ultium-branded chargers

to install in their communities.

The chargers will be available for

use by all EV drivers, not just

those who buy a GM model.

Sweetgreen is struggling to get

workers to prove they’re

vaccinated. The restaurant

chain, which filed for an initial

public offering on Monday, said

in its f iling that it has had

“significant challenges” getting

employees to submit proof of

coronavirus v accination. The

company’s locations are

concentrated largely in New

York City, Los Angeles, Boston

and the D.C. area, all of which

have some level of vaccine

mandate related to indoor

dining.

COMING TODAY

Earnings: Boeing, Coca-Cola,

General Motors, McDonald’s,

Ford

— From news services

DIGEST

CHAIDEER MAHYUDDIN/AGENCE FRANCE-PRESSE/GETTY IMAGES

Workers process material from sago palm trees i n Labuhan Haji,

Indonesia, on Tuesday.

BY TAYLOR TELFORD,

TONY ROMM

AND CAT ZAKRZEWSKI

The White House on Tuesday
named Jessica Rosenworcel and
Gigi Sohn to top Federal Commu-
nications Commission positions
in a late bid to stave off a Republi-
can majority over the regulator.
If confirmed, Rosenworcel, the
FCC’s acting chairwoman, would
be the first woman to lead the
agency. Sohn, a f ormer FCC offi-
cial, is a net neutrality advocate.
The FCC has been stymied by
vacancies during President
Biden’s tenure, as the White House
contends with a r aging public
health crisis, supply chain col-
lapse and a torrent of severe
weat her disasters. Unless both
candidates are approved by the
Senate before the end of the year,
Rosenworcel’s term will expire
and Republicans will claim a m a-
jority in January.
Rosenworcel, who had been

widely favored to be Biden’s pick,

faces a tangled policy landscape

that influences how Americans

learn, work, shop and communi-

cate. As acting chair, R osenworcel

has tackled robocalls and champi-

oned efforts to close the “home-

work gap,” including $3.2 billion

for emergency broadband ben-

efits to help millions of students

who lack access, according to the

FCC.

While regulators have long cast

Internet access as a luxur y, the

pandemic has crystallized how es-

sential the Web is to modern life. It

has illuminated the gulf between

those who can seamlessly migrate

their lives online and those who

must rely on free broadband sig-

nals in malls, coffee shops and

darkened parking lots. Research

has demonstrated that Internet

access is tethered to jobs and eco-

nomic growth.

The FCC’s most recent broad-

band progress report found that at

least 18 million Americans lack

fast, reliable Internet access; ex-

perts believe the real figure is

much higher.

Rosenworcel emphasized her

commitment to expanding broad-

band access to Americans in a

statement Tuesday.

“It is an honor to work with my

colleagues on the Commission

and the agency’s talented staff to

ensure that no matter who you are

or where you live, everyone has the

connections they need to live,

work, and learn in the digital age,”

she said.

Both nominees would be vital

to Democrats’ push to revive net

neutrality, the latest sally in a de-

cades-long battle over whether all

Internet traffic should be treated

equally by providers. The fight has

been marked by an endless ping-

pong of court challenges and cap-

tured national attention, spurring

millions of Americans to directly

plead with the FCC to preserve its

own rules before the agency voted

to repeal them under President

Donald Trump in 2017.

Now, in a moment that has em-

phasized how indispensable In-

ternet access is for all Americans,

Democrats are aiming to resurrect

one of their signature tech policy

priorities. In June, Biden signed

an executive order promoting

competition in the economy, se t-

ting the table for the FCC to re-

ado pt net neutrality provisions

and pursue a “ broadband nutri-

tion label” that allows consumers

to examine the details associated

with their broadband packages,

from data allowances to prices.

Andrew Jay Schwartzman, a

colleague of Sohn’s who also advo-

cates for net neutrality, said that if

confirmed, the nominees will al-

low the FCC to move forward with

initi atives that have been side-

lined while the commission was

deadlocked 2-to-2.

“Chair Jessica Rosenworcel and

Commissioners Geoffrey Starks

and Gigi Sohn will create an FCC

‘dream team’ that can implement

a progressive telecommunica-

tions policy agenda for the coming

decades,” Schwartzman, senior

counselor at the Benton Institute

for Broadband & Society, said in a

statement.

Sohn would also be the first

openly LGBTQ commissioner in

the history of the FCC, which

Schwartzman said could help the

FCC “reflect the often overlooked

needs” of the community.

The advocacy group Free Press

urged Congress to swiftly confirm

the nominees so that the agency

could advance Democrats’ tele-

com priorities.

“While these choices were

worth the wait, there’s no time to

waste and so much to get done:

ensuring the billions being invest-

ed in broadband actually reach

those who need it most, restoring

Net Neutrality and Title II, reck-

oning with media regulators’ his-

tory on race and repairing the

damage of the Trump years,” Free

Press p resident and co-CEO Craig

Aaron said in a statement.

Republicans have historically

grated against efforts to regulate

broadband like a utility, siding

with telecom giants including

AT&T, Comcast and Verizon that

say they believe in the principles of

Internet openness — b ut oppose

stiff federal rules to enforce them.

The White House also an-

nounced the nomination of Alan

Davidson as assistant secretary

for communications and informa-

tion at the National Telecommuni-

cations and Information Adminis-

tration, which is responsible for

advising the president on telecom

policy issues. Davidson is a tech

industry veteran who currently

serves as a senior adviser at the

Mozilla Foundation, a nonprofit

that promotes open Internet val-

ues. He previously started

Google’s public policy office in

Washington.

[email protected]

[email protected]

[email protected]

With clock ticking, Biden nominates acting FCC chair to permanent post

BY DAVID J. LYNCH

A deepening freight logjam is
defying President Biden’s hopes
of restoring normal cargo move-
ments, hampering the economic
recovery and threatening con-
sumers’ holiday shopping plans.
Two weeks after Biden admin-
istr ation officials announced
steps toward round-the-clock op-
erations at the nation’s chief port
complex, the backlog of ships
anchored off the coast of South-
ern California has only grown
larger. There is little sign that
truckers are taking advantage of
term inals’ extended hours to
move containers off the crowded
docks.
At APM Terminals’ Pier 400 in
Long Beach, Calif., the largest
such privately owned facility in
North America, nearly half of the
2,000 available appointments for
truckers went unused Friday, ac-
cording to Maersk, which owns
the site.
As complaints mount from af-
fected shippers, administration
officials are pressing ports, termi-
nals and truckers to rethink their
operations. On Monday, the L os
Angeles and Long Beach p orts
said they would impose new daily
fees on cargo carriers in a bid to
clear the docks and make room
for containers stuck on ships
offshore.
Starting Monday, t he ports will
bill carriers $100 per day for each
container that remains on the
dock for more than three days, if
slated to move by rail, or nine
days for truck-bound cargo.
Those per-container fees will in-
crease in $100 increments for
each day of additional delay, the
ports said.
John Porcari, the administra-
tion’s port envoy, who helped
develop the initiative, said it
would reduce port congestion.
But some retailers fear they will
get stuck with the tab.

The “decision to apply new

surcharges does not resolve our

ever-worsening supply chain cri-

sis and we fear carriers will see

this as another opportunity to

stick shippers with the bill on top

of already massive freight costs,”

said Stephen Lamar, president of

the American Apparel and Foot-

wear Association.

The new surcharges come just

days after city officials in Long

Beach — responding to what they

called a “national emergency” —

relaxed regulations limiting the

height of stacked shipping con-

tainers. For the next 90 days,

warehouses and industrial sites

in the city will be allowed to stack

containers four high, twice the

normal limit, to provide an outlet

for cargo stuck on the docks. (The

shift does not affect port termi-

nals, which already pile the rect-

angular metal boxes six high.)

Chronic port crowding shows

that pandemic-related shifts in

Americans’ spending habits have

overwhelmed the nation’s supply

lines. Consumers are spending

less today on services like airline

travel and restaurant meals than

they did in early 2020. But they

are purchasing about 15 percent

more goods like furniture and

computers, with many of those

products traveling from Asia

throug h the Southern California

ports.

More than 30 million tons of

cargo now rests aboard vessels

idling outside U.S. ports, econo-

mists at Goldman Sachs said

Tuesday. The investment bank

said port congestion will not ease

until the second half of next year.

The gridlock is contributing to

inflation that is lasting longer

than the Federal Reserve expect-

ed while denting corporate prof-

its, despite accelerating economic

growth.

Consumer and industrial com-

panies alike have cited supply

chain headaches in recent earn-

ings calls.

Lennox International, a maker

of heating and cooling systems,

told investors this week that sup-

ply chain disruptions and covid

impacts shaved $25 million off its

third-quarter operating profit

and would have a similar impact

over the remainder of the year.

The company is struggling with

shortages of computer chips as

well as wooden pallets and corru-

gated cardboard.

Likewise, supply snags includ-

ing labor shortages are prevent-

ing Kimberly-Clark, a manufac-

turer of sanitary paper products,

from filling all its orders, Maria

Henry, the company’s chief finan-

cial officer, said on an investor

call this week. “I don’t see a

near-term catalyst for them im-

proving,” she said of the holdups.

The White House is keenly

aware that fallout from supply

woes that Biden calls “signifi-

cant” has become a political lia-

bility — and officials are strug-

gling to identify solutions for

largely private-sector problems.

In a r ecent CNN town hall, the

president said he “absolutely,

positively” would consider using

National Guard units to alleviate

cargo backlogs, a move that few

logistics experts expect to hap-

pen.

Porcari last month facilitated a

decision by the neighboring

Southern California ports to ex-

tend their hours, with some ter-

minals operating around-the-

clock at least a few days each

week.

But the initial results have

been disappointing. The 73 con-

tainer ships anchored in South-

ern California’s San Pedro Bay on

Monday exceed the number that

were there when Biden an-

nounced the longer hours.

Truckers have been reluctant

to take advantage of the late-

night and predawn appointments

for collecting containers, either

Supply chain snags worsen

despite Biden’s intervention

Port delays persist after move to 24/7 service; new fees aim to clear docks

because they lack the necessary

chassis to hold the cargo or their

customers’ warehouses are full.

“Operational details still need

to be worked out on 24/7 opera-

tions at the ports of Los Angeles

and Long Beach. This level of

operations is not an overnight,

simple solution to implement —

and does not solve the broader

supply chain capacity challenges

and shortage of workers in truck-

ing, warehouse and supply chain

jobs,” Narin Phol, Maersk North

America regional managing di-

rector, told an industry confer-

ence in South Carolina on Mon-

day.

The new surcharges, which the

L.A. and Long Beach ports an-

nounced late Monday, were de-

veloped with Porcari, the admin-

istr ation’s ports specialist. The

fees will be spent on investments

to boost capacity and ease bottle-

necks, the ports said.

Some industry executives, who

spoke on the condition of ano-

nymity to discuss confidential

conversations, said the fees could

prompt carriers to deploy

“sweeper ships” to collect thou-

sands of empty containers clog-

ging the docks or to secure addi-

tional storage space inland. Ad-

ministration officials in recent

months scoured Southern Cali-

fornia for unused government

land without success.

Carriers are regarded as hav-

ing the deepest pockets in the

supply chain. The seven largest

publicly traded shipping lines —

including Maersk, Cosco and

Hapag-Lloyd — reported more

than $23 billion in profits in the

first half of this year, compared

with $1 billion in the same period

in 2020.

But Matt Schrap, CEO of the

Harbor Trucking Association,

whose members service the ports,

said the new fees would do noth-

ing about the “tens of thousands

of containers” sitting empty on

chassis, either at the port or at

area warehouses that are too full

to unload them.

Until those chassis can be un-

loaded and returned to the port to

collect fresh loads, the backlog

will linger, he said.

The National Retail Federa-

tion, representing companies

such as Walmart, Target and

Macy’s, also said the new sur-

charges are insufficient. “Key is-

sues such as chassis availability

and empty container returns still

need to be addressed. We encour-

age ocean carriers to continue to

work with importers and truck-

ers to move cargo as quickly as

possible and not just pass along

the cost of the fee, which will

further exacerbate the problems,”

the industry group said.

The new fees threaten to inten-

sify complaints from retailers

and other shippers over fines they

pay for not quickly collecting

their containers from the docks.

This summer, the Federal Mari-

time Commission said it would

audit these “demurrage” billings

by the top nine ocean carriers,

following complaints from ship-

pers about exorbitant charges.

Demurrage charges are intend-

ed to encourage shippers to col-

lect their containers in a timely

fashion, freeing up space needed

to make vessel loading and un-

loading more efficient. But with

supply lines jammed, many ship-

pers say they lack the equipment

or storage space needed before

they can pick up their goods.

[email protected]

MELINA MARA/THE WASHINGTON POST

The Port of Los Angeles last month. After the Biden administration pushed Southern California’s major

ports to run around-the-clock, other choke points are deterring truckers from using the extra hours.

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