We don’t have a supply chain crisis... we have a manufacturing crisis. The problem isn’t that we aren’t able to unload the ships fast enough. The real problem is that we don’t make anything here and we have to import almost everything.
The Past ten months have been frustrating. By design, the cost of making it here has increased significantly. The current administration is enacting policies to crush the dollar through debt, to shut down our energy production, and to make it too expensive to hire and retain a work force.
The shut down of our energy production is mind boggling. In the name of climate change, they are killing off homegrown energy production, while at the same time asking OPEC/China/Russia/Iran to increase their production to make up for our decrease. There’s been a temporary drop off in net oil/nat gas production worldwide with no real reduction in ‘carbon’.
But the real effect has been skyrocketing prices of oil and natural gas which is lining the pockets of some of our biggest adversaries, helping stabilize those regimes and putting them in a position to beef up their offensive military capabilities. Last year some of these regimes were in survival mode, focused on problems within their borders. Now, flush with cash (and a perception of unfocused and diminished US military capability) opportunistic territorial expansion via military conquest seems viable and probable.
But I digress... back to the economy and making it here. It’s almost as if they are purposely enacting policies which make building it here more expensive.
Most notably: - energy costs ... this is a HUGE factor in making or transporting any product. Gas and diesel prices are 2 and half times what they were a year ago. These increases along with natural gas rate hikes / electricity rate hikes are going to kill off many homegrown industries - raw material and packaging component costs. What little manfacurimg we have left relies on these imports and the since ships can’t unload their cargo, prices are going through the roof as supply can’t keep up with demand. - killing the dollar. We get enourmous benefit from being the reserve currency for much of the world. An unstable dollar (massive debt/increase of money supply) could quickly end the dollar’s status as THE reserve currency and the consequences will be horrific.
Our policies should be geared toward energy independence, homegrown supply chain resiliency (make it here), and sound fiscal policy with an eye towards restraint instead of buying votes and bankrupting our coiuntry.
Chineese good.
Make Things In America Again.
Perhaps we look at what drove our manufacturing offshore and try to reverse some of that - and hint, it wasn’t just the direct cost of labor, it was much more, much much more.
I had a great high tech cnc, fabrication, and engineering shop with many employees. Our idiot governor shut me down thanks to the Chinese kung flu. It’s not that we don’t have a supply chain here. The idiot democrats won’t allow one .
bttt
I think JIT has GREATLY exacerbated the problem.
The #1 cause of this problem is a highly inefficient interface between shippers/receivers and third-party trucking companies — coupled with an archaic business model for the trucking industry that incentivizes other parts of the supply chain to dump their inefficiencies on truckers.
Moving production back to the U.S. doesn’t solve this problem.
We spent 40 years sending jobs to China and Asia, to squeeze a few more pennies of cost to service debt. As a replacement, we have dispensable service jobs.
We will spend the next 40 years working to bring those jobs back, and pay back those costs that were reduced.
Paying people not to make things here has been a major boost to the economy . . . of the rich and cronies.
The backlog at the CA ports is mainly die to CA banning trucks over 3 years old and doing away with contractors which most truckers are.
You’re partially correct.
However, a significant amount of raw materials used in many manufactured goods by necessity are imported from other countries. They are from mines and contain elements that are not available in the US.
R&D and manufacturing are remarkably complex.
I, Pencil is an amazing essay written in the 1950’s to explain why command economics cannot possibly work. It follows all of the elements of a simple item, a pencil and the difficulties involved in extracting, shipping and assembling the simple item.
A modern corollary can be how we wouldn’t have many things in our lives without global supply chains, which are remarkably complex.
Complete isolationism doesn’t work and hasn’t since before the Industrial revolution.