Quick Vote Would Limit Strike Impact : Economy: Analysts fear that if the walkout is allowed to continue for more than a week or two, it could prolong the nation’s recession.

The nationwide rail strike is not likely to have a major impact on the economy, as long as the Bush Administration and Congress act quickly to end the walkout this week, economists and industry analysts said Wednesday.

But if the strike by 235,000 rail workers is prolonged for more than a week or two, it could begin to damage heavy industries already weakened by the recession and could delay the nation’s economic recovery.

With the White House pressuring Congress to move quickly to end the strike by imposing a mandatory cooling-off period during which labor talks would continue, there were strong signs that Washington would not allow the strike to continue beyond today or Friday.

The Administration’s willingness to intervene immediately underscores just how important railroads, a product of the 19th Century, remain in a high-tech economy.

Despite the increasing dominance of the airline and trucking industries over the last few decades, more than a third of the nation’s freight cargo still travels by rail. And while some industries can shift to truck or air transport during a rail strike, many producers of bulk products like chemicals, coal, grain and auto parts have no choice but to use the railroads.

Indeed, the nation’s auto makers warned Wednesday that they will have to shut down many of their plants by the end of the week and scale back production at the rest if the strike is allowed to continue.

While estimates of the cost of the rail strike vary widely, Transportation Secretary Samuel K. Skinner said that the last nationwide walkout, a four-day strike in 1982, cost the U.S. economy $1 billion a day.

Because the economic impact is substantial, economists say that the White House and Congress have no choice but to stop the strike before the damage spreads.

“I think President Bush is concerned about the impact and I think that is a valid concern,” said Bob Dye, a senior economist at the WEFA Group, an economic consulting firm based in Bala-Cynwyd, Pa.

The strike’s immediate impact is limited primarily to snarled commuter rail service and curtailed shipments for the auto industry, which transports most of its parts and many of its finished cars by rail. Under the auto industry’s “just-in-time” system of delivery, disruptions in parts supplies have an almost instant impact on production. A spokesman for Ford Motor Co., for example, said that the firm immediately cut its eight-hour shifts in half Wednesday at a Chicago assembly plant that makes its popular Taurus model.

But the strike’s impact could spread within a week or two to include major industries from agriculture to coal, utilities to steel. More than half of the nation’s coal moves by rail.

“A rail strike could snowball quickly throughout the economy,” noted Walter Joelson, chief economist at General Electric Co.

And if Congress does not act to force the strikers back to their jobs, there will be little that the government can do to provide alternative means of transportation to reduce the strike’s economic impact.

“I think the strike will have to be short, but the costs would mount so quickly if the strike continues that it would become unacceptable,” cautioned Howard Roth, chief economist of Security Pacific Corp. in Los Angeles.

Before the strike began, many economists were predicting that the recession would end sometime this spring; they forecast that the nation’s output of goods and services would show a slight upturn in the second quarter for the first time since last fall. Economists define a recession as two consecutive quarters of decline in the Gross National Product.

But a lengthy strike could make it impossible for the recovery to begin in the second quarter, economists said.

“If it was allowed to continue, it would add to the economic weakness that we have right in the middle of a recession,” said Joelson, the General Electric economist.

RELATED STORIES: D1