The Pacific Maritime Association shut down all West Coast ports Friday in response to work slowdowns by the International Longshore and Warehouse Union. As freight backs up, White House spokesman Ari Fleischer says the president is keeping a close eye on this critical and costly labor dispute.

The ILWU has been without a contract since July 1. Contract talks are stuck on the issue of computerized cargo-handling machinery. The PMA says they need this technology, but ILWU officials fear the new technology will cost union workers their jobs.

The ports opened Sunday, but the ILWU was still reportedly engaging in slowdowns and the PMA reinstated the lockout after one shift, according to Bear Stearns investment analysts. The ports remained closed Monday morning.

Late last week, the PMA announced ILWU slowdowns had resulted in port productivity plummeting 25 percent to 90 percent, causing ships to miss sail times, disrupting rail schedules and leaving cargo idle on the dock. At the new Maersk terminal in Los Angeles, congestion is apparently so severe that 250 trucks are stuck at the in-gate, with 150 lined up at the out-gate.

Bear Stearns believes an extended shutdown of the ports remains unlikely. "We expect the government will intervene prior to a major impact to the transports and the economy," the investment company stated. "We also believe there remains several weeks of freight to move stacked up near the ports prior to new freight arriving through the West Coast."

In transports, Bear Stearns expects the railroads and intermodal companies will have the greatest exposure to a near-term port action, with the airfreight, truckload and less-than-truckload carriers having minimal, if any, exposure.

Bear Stearns' research suggests shippers have been bringing in freight roughly three or four weeks early and have been stockpiling it in container yards near the West Coast ports. As these shippers have needed to use this freight in their usual supply chains, the shippers have been moving cargo through intermodal, trucking and rail networks on a relatively normal basis.