Trump's Embracing Unions Will Cause Economic and Oil Pipeline Strife

This article was first published on my personal blog at Talkmarkets: http://www.talkmarkets.com/contributor/gary-anderson/blog/commodities/trumps-embracing-unions-will-cause-economic-and-oil-strife?post=119777&uid=4798

Face it, Donald Trump moved sharply to the left when he embraced unions on the first day of his occupation of the White House. Republicans are simply giddy. Union leaders clapped. Trump did not want a free trade agreement, the TPP, with nations that could have undercut US workers. Jobs and production could have been shifted to nations such as Malaysia.

So, what are the pros and cons of Trump's new found connection with labor? After all, he had illegally operated Trump tower for two years as cocktail waitresses and waiters tried to organize Trump Hotel. People in Las Vegas were perplexed by his resistance to the powerful culinary union given his support for labor unions in the past. He finally settled with the union just before taking office.

Of course everyone knows that unions were busted by globalization and by trade deals that the new POTUS has characterized as being bad for workers in the USA. Donald Trump opposes those deals. Prior to winning the election, articles abounded regarding how Trump would treat unions, with more articles reporting that he would hurt unions and fewer articles stating that he would be good for them.

At first he was for lower wages and then later for higher wages. Lower wages would make the US more competitive globally, but if POTUS does not care about exporting, he would obviously want to get a lot more money into the hands of the US workforce fast. Unions would be a tool for making that happen. There will be strife in the nation. You can count on it. I am not saying all strife is bad. We will have to see how it will play out. But this won't be the only strife. 




The Washington Times appears to have read the tea leaves correctly early, back in May of 2016, as it ran an article pointing out Trump's strength with union workers in the very states that made a difference in the election. Democrats were fearing Trump's union support back then. Of course, Nevada went against POTUS because the culinary union members remembered his contentious battle to unionize the Trump Hotel on the strip. Overall, big union leaders supported Trump but for a reason that could prove to push most Americans to oppose unions.

At issue with the building trades unions was the Democrats opposition to the Keystone XL pipeline! The building unions opposed billionaire Tom Steyer's efforts to turn out the vote for Hillary Clinton because he opposed the pipeline.

The Times pointed out that the AFL-CIO apparently took the building trades' position seriously. Trump cashed in as the rift within the Democratic Party between environmentalists and organized labor caused diminished turnout:

“In terms of his message, it is really resonating. Particularly if you are talking [about] union people, he is speaking our language,” Josh Goldstein, deputy national media director for the AFL-CIO told the Huffington Post. “We can’t let that go unattended, because people have been doing that with Trump for a long time, and his numbers have only gone up. … It is our job to go out and educate people now, so it doesn’t cross that threshold and become a threat.”
But major strife is brewing because of this position by the building trades union. Support for the Keystone XL pipeline is strong now in national polls, but the plight of the Standing Rock Sioux Tribe versus the Dakota Access pipeline may negatively impact all future pipelines through the heartland. There are vets, ex military men willing to risk their lives in order to stand with and protect the protesters, knowing a minor spill could contaminate the water supply of the Standing Rock Sioux tribe.

The same building unions that helped to fracture the Democratic Party, thereby helping to elect Trump, in opposition to the AFL-CIO, also support the Dakota Access pipeline. I think that could turn out to be a huge political mistake if America sides with the native Americans. But right now they have the ear of the new president.


It makes more sense, politically and economically, for Trump to allow the XL pipeline and diffuse the Dakota Access pipeline situation. However, in December of 2016, he is reported to have given his support for the first time to the Dakota Access pipeline. And he has signed an executive order to go ahead with both pipelines. Reuters reports that:

Most of the Dakota pipeline was completed by the summer of 2016, except for a small section under Lake Oahe, a reservoir that forms part of the river.
Trump on Monday met with leaders of labor unions, including the Building and Construction trades group and the Laborers International Union of North America, who have been vocal supporters of both pipeline projects.


As America finds out that union support is at the heart of this Dakota support, it could backfire on Donald Trump because people will likely die in this protest, and native Americans and former military men could die because Trump supports the building unions.

And that is a strife that America and Donald Trump could do without.

Building a pipe carrying oil under a lake necessary for the Sioux water supply has been cleared by the Army Corps of Engineers, but seems to defy common sense. Not only will unions be hurt by this assault on the native Americans, but so will oil companies in the short term. The companies invested in Dakota have a lot to lose in terms of PR. These include Energy Transfer Partners, Phillips 66, Enbridge and Marathon Oil.

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