Overnight Finance

On The Money — Will Biden’s rail deal backfire?

Rail workers say their colleagues are preparing to leave after being disappointed by the contract forced through by Congress and signed by President Biden.

We’ll also look at the battle for the child tax credit and the Trump Organization’s guilty verdict in a tax fraud case. 

But first, follow along here to see the live Georgia Senate results. 

Welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. For The Hill, we’re Sylvan LaneAris Folley and Karl Evers-Hillstrom. Someone forward you this newsletter? Sign up here or in the box below.

Workers warn of exodus after Congress pushes deal

Railroad workers could leave the industry after Congress forced through a contract that does not provide them with dedicated paid sick days, an exodus that would ripple through an economy reliant on freight railroads to transport goods. 

The exit of thousands of train conductors and engineers would be felt by major corporations and U.S. consumers alike. It could slow the delivery of food, fuel and online orders while strangling already-shaky supply chains. 

“I don’t think you’ll just see half of the workforce disappear, but you’ll see a good percentage, and we can’t afford for anybody to leave because we’re so undermanned as it is,” said Hugh Sawyer, an Atlanta-based engineer at Norfolk Southern. 

  • Those who were holding out hope for a strong contract might look for a new job after the deal failed to provide paid sick leave or put an end to strict attendance policies and strenuous schedules that require workers to be on call constantly.
  • Any exodus of workers would only exacerbate staffing shortages brought on by railroads laying off around 30 percent of their workforce over the past six years.
  • That, in turn, has led to exhausted workers and persistent delays and cancellations when demand for shipped products spiked.  

Here’s when it could happen: Workers say that some employees could leave as soon as they receive back pay and cash bonuses, which will average roughly $16,000 per person. Railroads will dole out that money within 60 days. 

Karl has the details here.

🚨 GUILTY VERDICT

Trump Organization found guilty of tax fraud 

A New York jury on Tuesday found the Trump Organization guilty of tax fraud following a more than monthlong trial. 

Jurors began deliberating on Monday and returned the guilty verdict on Tuesday afternoon, according to The Associated Press. 

Former President Trump himself was not on trial, but prosecutors with the Manhattan district attorney’s office showed jurors evidence that Trump had signed off on bonus checks and memos that helped top executives skirt reporting on taxable income. 

Following the verdict, the Trump Organization could be fined up to $1.6 million. 

The Hill’s Brad Dress has more here.

📈 RATE EXPECTATIONS

Negotiators dig in over tax credits in spending bill

Tax credits for individuals and businesses are up for grabs as negotiations on a year-end spending deal come down to the wire.

  • The possible credits range from an expansion of the child tax credit (CTC), which was beefed up during the pandemic and ate away at child poverty rates in the U.S., to incentives for companies to invest more in research.
  • Negotiators on both sides of the aisle say they’re working on tax provisions and that getting a spending deal done is a high priority before a new Congress arrives in 2023 and voting dynamics on Capitol Hill become harder to predict. 

Though support for the various tax provisions doesn’t break down perfectly along party lines, Democrats for the most part are arguing for credits geared toward low-income workers and families, while Republicans want extensions of the Trump administration’s 2017 Tax Cuts and Jobs Act that allow businesses to keep more of their money.

Tobias Burns and Aris break it down here.

Labor board: Apple interfered with organizing effort

Apple illegally interfered with union organizing efforts at an Atlanta store by holding mandatory meetings to discourage union membership, the National Labor Relations Board (NLRB) found. 

The NLRB also found merit behind allegations that the Apple store at Cumberland Mall in Atlanta interrogated workers about union support and activities, solicited grievances and told workers that union membership would result in less favorable terms of employment. 

The Communications Workers of America (CWA), a national communications and media union, initially filed a complaint against Apple Cumberland Mall in May. The CWA previously petitioned for a union election at the store but withdrew its request as a result of “Apple’s repeated violations.” 

The Hill’s Julia Shapero has more here.

Good to Know

The Government Accountability Office (GAO) blasted colleges in a new report for misleading students in financial aid letters about the total cost of attendance. 

Ninety-one percent of colleges underestimated or did not include the net price of attending their institution in financial aid offers to students, according to the GAO report. 

Other items we’re keeping an eye on: 

  • Rental car company Hertz on Monday announced it will pay $168 million to settle 364 customers’ claims related to the company falsely reporting they stole vehicles, which caused some customers to go to jail.
  • Maryland Gov. Larry Hogan (R) has implemented a ban on TikTok in the state’s executive branch, citing security concerns over Chinese-based owner Byte Dance. 

That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you tomorrow.

Tags Apple Government accountability office Joe Biden rail strike Trump Trump Organization

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