In its World Economic Outlook report issued yesterday, the IMF said global growth for this year would be 3.6 percent, down 0.8 percentage points from its estimate in January and 1.3 percentage points lower than the forecast six months ago. For 2021, it said growth would come in at 6.1 percent. These figures, however, only partially depict a picture of a rapidly worsening economic outlook amid continuing supply chain constrictions due to the COVID-19 pandemic and surging inflation, exacerbated by the war in Ukraine and tighter monetary policy, as central banks lift interest rates. The WEO report said “unusually high uncertainty” surrounded its forecasts and “downside risks to the global outlook dominate.”
Anyone old enough to remember the Cold War is familiar with a scene routinely depicted on U.S. television at the time: the Soviet breadline. Warning Americans about life under communism, these clips showed Russian citizens lingering forlornly outside businesses for hours to obtain basic goods—indelible proof of the inferiority of central planning, and an advertisement for capitalism’s abundance. Breadlines, the Big Book of Capitalism assured us, could not happen in a market economy. Supply would always rise to meet demand, as long as there’s money to be made. Only deviating from free-market fundamentalism—giving everyone health care, for example—could lead to shortages. Otherwise, capitalism has your every desire covered.
If you ordered a teddy bear or a designer picture frame as a holiday gift, you know that it likely took a lot longer to get here than in past years. There have been problems getting things from point A to point B since the pandemic started. At one point in October, 77 percent of the world’s ports were experiencing long delays. More than most Americans, Longshore Union (ILWU) members grasp what supply chain problems are and how they come about. Many come from multigenerational families of port workers who understand both their militant union’s storied history and its role in the global economy today. ILWU members handle the containers that go into and out of the United States through nine West Coast ports.
I have a simple question for every ‘expert’ who thinks they understand the root causes of the shipping crisis: Why is there only one crane for every 50–100 trucks at every port in America? No ‘expert’ will answer this question. I’m a Class A truck driver with experience in nearly every aspect of freight. My experience in the trucking industry of 20 years tells me that nothing is going to change in the shipping industry. Let’s start with understanding some things about ports. Outside of dedicated port trucking companies, most trucking companies won’t touch shipping containers. There is a reason for that. Think of going to the port as going to WalMart on Black Friday, but imagine only ONE cashier for thousands of customers.
As a congestion crisis continues to stall polluting container ships in ports around the world, there is a growing awareness of the role that international shipping plays in both the climate crisis and the public-health impacts of air pollution. Released on Cyber Monday, a new report from Ship It Zero coalition members Stand.earth and Pacific Environment details the relationship between four major retailers that ship goods to the U.S. — Walmart, Amazon, Target and IKEA — and the fossil-fueled carrier companies that make that shipping possible. “Major retail companies and cargo carriers are flush with cash from pandemic-driven record breaking profits and are tightening their already close relationships,” Stand.earth shipping campaigns director Kendra Ulrich said in a statement emailed to EcoWatch.
The supply disruptions plaguing the US economy are not the result of "excessive demand," "central planning," or a lack of efficiency. Rather, it is that a logistics ecosystem that was developed to feed the beast of American consumption was not designed for a pandemic.