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By Matt Smith - San Francisco Weekly, February 6, 2008

Imploding U.S. mortgage markets leave behind trillions of dollars in economic damage. The dollar's slide against the euro and the yuan raises fears of a currency collapse. January job losses portend recession.

To these threats to U.S. economic stability, add a new and severe one that is brewing in the conference rooms of the Cathedral Hill Hotel, a blue-collar establishment on Van Ness. There, West Coast dockworkers' representatives are devising a strategy to renegotiate a unified ports agreement with shipping companies that is scheduled to expire July 1. If the renegotiation is as fractious as it was in 2002 — when shippers attempted to break the union by shutting down 29 West Coast ports for 10 days — an extended dispute could paralyze U.S. economic activity and send financial markets tumbling.

A shutdown like the last one "carries the very real risk of triggering a sudden crisis in international financial markets," U.C. Berkeley professor Stephen Cohen, co-director of the Berkeley Roundtable on the International Economy, wrote in a 2002 paper. When I spoke with him last week, he said he'd be watching the situation this time, too: "I don't think the significance is any different. At some point, you start running out of parts, and the factory stops, and the factory that relies on that factory for components stops, and you have a chain reaction that's really rather a nightmare."