September 30, 2021

The Supply-Chain Bottleneck

Ships are sitting in Southern California just waiting to be unloaded.

This is not the year to wait until the last minute to do your Christmas shopping, even if you’re among the growing number of people who embrace the convenience of doing it all online. America is suffering from a major supply-chain problem that is only expected to get worse as we head into the last quarter of the year. The response to the pandemic threw us into an economic and manufacturing tailspin from which we have yet to emerge. But why does the shipping problem persist?

There are a few factors at work. One is the volume of goods we are importing from overseas, and by overseas, we’re talking about our consumer overlords in China. In pre-COVID times, the West Coast ports of Long Beach and Los Angeles handled the bulk of our Asian imports effectively. However, the slow return to pre-pandemic manufacturing and shipping levels has forced a major bottleneck as manufacturers and retailers attempt to tackle the yearlong backlog of orders. Also, since the early pandemic lockdowns, consumers are doing more of their shopping online, foregoing trips to brick-and-mortar locations in favor of having goods shipped directly to them.

The bottleneck at Long Beach has reached epic proportions. A veritable flotilla is anchored off the Southern California coast, with 73 ships currently waiting their turn for access. The average wait time for offloading after a ship reaches American waters runs about three weeks. Pre-pandemic, it was a rarity to see more than one or two ships anchored offshore at one time.

Part of the problem is with the hours that these California ports keep. While several major ports around the country and around the world run on a 24-hour schedule, the ports at Long Beach and Los Angeles are closed nights and Sundays. In these extraordinary times, it might be worthwhile to revisit that schedule, at least temporarily.

Another issue is the labor shortage. Companies are eagerly seeking truck drivers, warehouse hands, forklift operators, inventory managers, anybody who can help move the goods.

Mario Cordero, the executive director of the Port of Long Beach, predicted a crisis earlier this week, saying that everyone needs to come to grips with the fact that the supply chain is significantly disrupted, and it will be into 2022.

Southern California is the gateway to America for Asian goods. Last year, Long Beach and Los Angeles ports handled 8.8 million loaded import containers. The nation’s next busiest ports in New York and New Jersey handled less than half that amount. Most other ports on the West Coast can’t handle the volume of SoCal, but that may have to change. The holiday season in the United States will soon be upon us. And after that comes the Chinese New Year in February, which will also extend our import woes.

It’s a bitter pill to swallow, or at least it should be, that a Chinese holiday is disrupting the American supply chain. Some would say that’s what globalization looks like. But this is about more than that. China is responsible for the outbreak of the COVID-19 pandemic, and Beijing has yet to be held to account for it. The breakdown and continued disruption of our supply chain was a direct result of China’s actions, or lack of them.

While it’s fair to blame China for the current global supply-chain disruptions, it’s ultimately America’s fault that we’re so beholden to foreign manufacturers for our goods. This is doubly true when our principal trading partner is a totalitarian state that seeks to push its influence across the world.

We’re also to blame as consumers. Our culture taught us to seek goods endlessly. Either for the sake of economy or convenience, we became hooked on cheap goods. The Chinese excel at making cheap goods, thanks in large part to their lax manufacturing rules and their use of slave labor.

We’re also impatient. Goods are shipped fast in part because there are fewer warehouses to hold goods anymore. Businesses follow just-in-time inventory practices. By keeping only a few days’ supply of given items, they cut their overhead with less warehouse space, lower maintenance costs, and fewer workers. In an economy run by computers that keep track of where everything is all the time with little effort, that’s great. But once the system breaks down, you end up with what we have now: waiting three weeks for a pair of socks.

Or buy American. And make American. And sell American.

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