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(NEW YORK) — Tens of thousands of U.S. dockworkers are set to walk off the job early Tuesday morning, clogging dozens of ports along the East and Gulf coasts and potentially raising consumer prices ahead of the holiday season.

“Moments ago, the first large-scale eastern dockworker strike in 47 years began at ports from Maine to Texas, including at the Port Authority of New York and New Jersey,” New York Gov. Kathy Hochul said in a statement Tuesday.

“In preparation for this moment, New York has been working around the clock to ensure that our grocery stores and medical facilities have the essential products they need,” Hochul added.

In a statement to ABC News early Tuesday, the International Longshoremen’s Association (ILA) confirmed the union’s first coastwide strike in nearly 50 years was underway. The statement said that “tens of thousands of ILA rank-and-file members” started to set up picket lines at shipping ports up and down the Atlantic and Gulf coasts as of 12:01 am.

“We are prepared to fight as long as necessary, to stay out on strike for whatever period of time it takes, to get the wages and protections against automation our ILA members deserve,” ILA President Harold Daggett said.

The ports account for more than half of the nation’s container imports, facilitating the transport of everything from toys to fresh fruit to nuclear reactors, JPMorgan senior equity analyst Brian Ossenbeck said in a report shared with ABC News.

A prolonged work stoppage of several weeks or months could rekindle inflation for some goods and trigger layoffs at manufacturers as raw materials dry up, experts said.

“A strike would be very, very disruptive,” said Jason Miller, a professor of supply-chain management at Michigan State University who closely tracks imports, told ABC News.

“You can’t take all this freight and either send it to other ports or put it on airplanes,” Miller added. “There is no plan B.”

The ILA, the union representing East Coast and Gulf Coast dockworkers, is seeking higher wages and a ban on the use of some automated equipment.

“ILA longshore workers deserve to be compensated for the important work they do keeping American commerce moving and growing,” the ILA told ABC News in a statement on Monday. “Meanwhile, ILA dedicated longshore workers continue to be crippled by inflation due to USMX’s unfair wage packages.”

The U.S. Maritime Alliance, or USMX, an organization bargaining on behalf of the dockworkers’ employers, declined to respond to an ABC News request for comment.

President Joe Biden retains the power to prevent or halt a strike under the 1947 Taft-Hartley Act. The U.S. Chamber of Commerce sent a letter to Biden on Monday urging the White House to intervene, which it has previously said it will not do. The White House told ABC News in a statement that it has been in contact with both the union and management in recent days.

“This weekend, senior officials have been in touch with USMX representatives urging them to come to a fair agreement fairly and quickly – one that reflects the success of the companies. Senior officials have also been in touch with the ILA to deliver the same message,” White House spokesperson Robyn Patterson said.

A prolonged East Coast and Gulf Coast port strike could moderately increase prices for a range of goods, experts told ABC News. That upward pressure on prices would result from a shortage of products caught up in the supply chain blockage, leaving too many dollars chasing after too few items, they added.

Food products are especially vulnerable to an uptick in prices, since food could spoil if suppliers sent the products ahead of time to minimize the strike impact, as they have done for some other goods, Adam Kamins, a senior director of economic research at Moody’s Analytics, told ABC News.

Additionally, a significant share of the nation’s imported auto parts pass through the ports impacted by a potential strike, which could cause an increase in vehicle prices if the strike persists.

Price increases have slowed dramatically from a peak in 2022, but inflation remains higher than the Federal Reserve’s target rate of 2%. A strike could prevent further progress, according to Kamins.

“We’re not talking about prices skyrocketing by any means, but I think it halts the momentum we’ve had over the last year or so getting inflation back in the bottle,” he said.

In 2002, a strike among workers at West Coast ports lasted 11 days before then-President George W. Bush invoked the Taft-Hartley Act and ended the standoff. However, the last time East Coast and Gulf Coast workers went on strike, in 1977, the work stoppage lasted seven weeks.

Tuesday’s potential work stoppage follows high-profile strikes undertaken last year by auto workers as well as Hollywood writers and actors. Most recently, 33,000 Boeing workers walked off the job in early September, demanding better pay and retirement benefits.

“Trade unions all over the country have been going out on strike,” Sriram Narayanan, a professor of supply chain management at Michigan State University, told ABC News. “We’re seeing that happen now at the ports.”

Ahead of the historic strike, the president of the Teamsters labor union, Sean O’Brien, released a letter of solidarity to the International Longshoreman’s Association, saying, “The International Brotherhood of Teamsters, including our members in the freight industry, stand in full solidarity with the International Longshoremen’s Association as they fight for a fair and just contract with the ocean carriers represented by USMX.”

“Don’t forget –Teamsters do not cross picket lines. The Teamsters Union is 100 percent committed to standing with our Longshoremen brothers and sisters until they win the contract they deserve,” O’Brien said.

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(WASHINGTON) — Borrowers eager for the Federal Reserve to abandon high interest rates could not have scripted a better four-word declaration than the one on Friday from Fed Chair Jerome Powell: “The time has come.”

Powell indicated that the Fed would soon bring interest rates down from a 23-year high. The shift could lower borrowing costs for everything from credit cards to auto loans to mortgages.

The pace and scale of rate cuts remains unknown, however. A cautious approach could leave borrowers saddled with high costs for the next several years while an aggressive reset could ease loan rates substantially within months.

“The question now is how far and how fast should the Fed cut rates?” Mark Zandi, chief economist at Moody’s Analytics, said in a post on X on Sunday.

The chances of an interest rate cut at the Fed’s next meeting in September are all but certain, according to the CME FedWatch Tool, a measure of market sentiment.

Market observers are divided over whether the Fed will impose its typical cut of a quarter of a percentage point or opt for a larger half-point cut. The tool indicates a roughly 60% chance of a quarter-point cut and a 40% chance of a half-point cut.

Over the remainder of the year, the most likely scenario is a quarter-point rate cut at each of the Fed’s three scheduled meetings in September, November and December, the CME FedWatch Tool shows.

The Fed is guided by a dual mandate to keep inflation under control and maximize employment. In theory, low interest rates help stimulate economic activity and boost employment; high interest rates slow economic performance and ease inflation.

In recent months, the labor market has slowed alongside cooling inflation. That trend was highlighted last month by a weaker-than-expected jobs report that raised concern among some economists that the U.S. may be headed toward a recession.

Recent trends have shifted the Fed’s focus away from controlling inflation and toward ensuring a healthy labor market, Powell said Friday.

“A cooldown in the labor market is unmistakable,” Powell said, adding that he would let economic performance dictate the course of rate cuts.

“The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook and the balance of risks,” Powell said.

Gregory Daco, chief economist at accounting firm EY, said in a statement to ABC News that he expects a quarter-point rate cut at each of the Fed’s next three meetings in an effort to soften the ongoing economic slowdown. However, worries about an imminent recession are overstated, Daco added.

The Fed aims to “buffer the economic downshift,” Daco said.

Deutsche Bank, which also projects three quarter-point rate cuts before the end of the year, said in a note to clients on Friday that a weak jobs report early in September could push the Fed to opt for a larger half-point cut at its meeting later that month.

“The softer-than-expected July jobs report and recent bouts of market volatility have shifted risks towards the Fed cutting more aggressively upfront,” Deutsche Bank said.

Analysts differ widely over the course of interest rate cuts in the next year or two. Zandi said the Fed should bring interest rates down significantly from the current target rate of between 5.25% and 5.5%. By the end of next year, interest rates should stand at 3%, he added.

By contrast, former Treasury Secretary Larry Summers cautioned against an aggressive approach to interest rate cuts. “We need to be rather more cautious about the medium term outlook for monetary policy,” Summers said in a post on X on Saturday.

Still, Summers added, the need for some rate cutting is beyond question.

“Inflation is coming down. The economy is slowing. On current facts, absolutely the next move should be towards monetary policy easing,” Summers said.

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(NEW YORK) — Fearless Fund, a venture capitalist firm that invests in female entrepreneurs of color, has settled a discrimination lawsuit over a grant program specifically for Black women.

The lawsuit from the American Alliance for Equal Rights (AAER) claimed that the fund’s Fearless Strivers Grant Contest, which was open “only to Black females,” was discriminatory.

The grant program was at its end when the court case began in 2023, according to an online post by Fearless Fund founder Arian Simone, and the fund said it was motivated to avoid a court ruling so as not to lead to a Supreme Court decision that could end minority-based funding nationwide.

The Fearless Fund said it will continue to focus on “helping under-resourced entrepreneurs who have been ill served by traditional capital markets for far too long.” In a statement on the settlement, it announced a new $200 million debt fund with the goal of lending to more than 3,000 under-resourced founders.

Representatives of Fearless Fund partners Simone and Ayana Parson told reporters in August 2023 that the fund was established to address the wide gap in venture capital funding for businesses led by women of color “who confront barrier after barrier to obtain support and investments for their businesses.”

The Fearless Strivers Grant Contest was created specifically for Black women because Black women-owned businesses receive less than 1% of venture capital funding, according to the organization.

AAER called the grant program “divisive and illegal” and claimed that it “encouraged the Fearless Fund to open its grant contest to Hispanic, Asian, Native American and white women but Fearless has decided instead to end it entirely.”

White women-founded companies take home 64% of “Diversity Investments” by deal count, meanwhile women of color-owned businesses only take home 10%, according to an analysis of Crunchbase data by venture capital firm BBG Ventures.

Fearless Fund partners have long defended their work, citing the poor representation of women of color among venture capital recipients and evidence of racial bias in the investment decisions of asset allocators.

“From the moment the lawsuit was filed, I pledged to stand firm in helping and empowering women of color entrepreneurs in need. I stand by that pledge today and in fact my commitment remains stronger than ever,” read a statement from the organization’s co-founder Arian Simone. “Our overarching mission remains focused on helping and empowering entrepreneurs who have been historically overlooked in the venture capital marketplace.”

AAER’s founder Edward Blum also leads the Students for Fair Admissions, the group that initiated the anti-affirmative action case that reached the Supreme Court and won the case, setting new limits on the use of race-based policies in college admissions.

The conservative group claimed that affirmative action, which was implemented to address racial inequities in access to higher education, violated the equal protection clause of the 14th Amendment.

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