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**MARCH 26, 2024**
On the Prospect website
The Connection Between Jobs and Housing
The good news/bad news story in the Economic Report of the President BY
ROBERT KUTTNER
Who Controls Your Shopping Cart?
Austin Frerick's 'Barons' follows the food-industry giants that
have cornered giant portions of the market for everything from coffee to
chicken thighs. BY H. CLAIRE BROWN
Trump Campaign Slogans
Tom Tomorrow brings you This Modern World BY TOM TOMORROW
Dayen on TAP
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**** The Ever-Present Threat of Supply Shocks
The Francis Scott Key Bridge tragedy in Baltimore is a reminder that
sudden changes to how we move goods around the world can happen anytime.
Last night, a Singapore-flagged 948-foot container ship called the Dali
lost power twice in Baltimore Harbor. When the crew regained control,
they could not avoid slamming into a support column of the Francis Scott
Key Bridge, almost immediately sending the entire span tumbling into the
water. The video
is terrifying. Several people remain missing, including members of a
crew that was doing pothole maintenance on the bridge. Fortunately, the
ship was able to make a distress call that prevented more cars from
entering the bridge span at the time of the collapse.
This is a huge blow to the city of Baltimore. Its harbor sits on the
other side of the former bridge, and it's impossible to determine how
long it will take for debris to be removed to make it safe for ships to
reach the port. The Port of Baltimore happens to be the country's
leading import/export point
for automobiles and light trucks. The Baltimore Banner estimates 15,300
direct and 140,000 indirect jobs from port activity. All of that will be
on hold at the moment, as cargo must shift to other ports. There are
also six large cargo vessels
essentially
stuck in the harbor without a way out.
It takes time for companies that previously relied on the Port of
Baltimore to shift their logistics. It's not the largest port in the
U.S. (that would be the Ports of Los Angeles and Long Beach), but for a
nontrivial amount of goods, it's a vital artery and now it's shut
down. Decisions have to be made to compensate for the loss.
[link removed]
The larger point here is that supply resiliency is an enduring need. One
of the arguments against rethinking supply chains amid the pandemic
crunch was that COVID was a world-historical event whose equal we will
never see again, and we shouldn't overreact by reconfiguring a system
that otherwise works well. This wasn't even true at the time of the
supply chain problems, which had as much to do with extreme weather
as manpower shortages due to sickness. In a globalized world, any
incident at any time can have ripple effects, from a fire in a factory
to storm surges to, yes, a power outage on a cargo ship leading to a
bridge collapse.
We know that climate change is intensifying some of these incidents that
aren't attributable to mechanical failure or human error. And
geopolitical concerns, whether in Ukraine or Taiwan or places we don't
yet know about, can snarl supplies.
That's why the Biden administration's effort to increase
manufacturing capacity in critical sectors was such an imperative, along
with the job gains and revitalization of industrial communities.
Redundancy and diversification make problems like the Key Bridge tragedy
less impactful to global commerce. Yesterday's announced $6 billion
investment
aimed at reducing emissions at industrial facilities is an important
contribution to cleaning up global manufacturing, potentially mitigating
some of the variances in extreme weather that is driving supply shocks,
and setting up the U.S. as a clean-manufacturing leader, which could
spur more investment and supply chain diversification.
As I wrote two years ago
, "The
overall goal is to re-create a coherent national logistics system, in
which government regains the power to regulate and coordinate what has
been privatized ... The growing threats to long, concentrated supply
chains make re-engineering away from a tightly interconnected system
essential rather than optional."
In other words, the pandemic wasn't an anomaly, but a warning.
~ DAVID DAYEN
**Follow David Dayen on Twitter**
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