A good way to get people talking, in this era of a lingering pandemic, is to ask them if they have tried renting a car lately. Even if they didn’t, they probably heard the stories, possibly on largely empty grounds at the Atlanta airport, where patrons were forced to participate in what the actress Audra McDonald, in an angry tweet called it a “hunger game relay,” or about the man who said in Los Angeles Times that he had booked a compact car to take his kids to Disneyland before being directed to a van that “reeked of cigarettes and marijuana.” But most of the stories are more everyday; the common elements are long queues, high rates, little choice and mysterious references to “supply chain problems”.
What are these supply chain issues and why, more than a year and a half after the start of the pandemic, do they continue to appear in many corners of life? The shortage of rental cars, as well as used and new cars, is not expected to abate until at least next year. Last week, the Park Slope Food Co-op in Brooklyn emailed members explaining that certain types of pasta may be out of stock; other vendors are struggling to get chicken wings. At times, it has been strangely difficult to find plumbing fixtures, building materials, salad dressing, and even new books. Distance working and schooling have increased demand for technology products, contributing to long waits. Most of the items are, in the end, available, if at a higher price; in the past year, the consumer price index has risen by about five percent, double the percentage it had increased the year before the pandemic.
Americans don’t face empty Soviet-style shelves, or having to get rid of the essentials. Overall, we are hardly in a shortage situation. Yet supply chain issues suggest that something is wrong with the way we operate in the world and that we do not yet know the extent of our vulnerabilities. These problems can also constitute a serious obstacle to a broader economic recovery.
The most obvious culprit is COVID-19. In the case of rental cars, when trips fell sharply in the spring of 2020, many companies generated cash by selling a significant portion of their fleets. They might have assumed that they could just buy more cars later, but when the time came, the cars were no longer available. The main reason for this is a global shortage of semiconductors, the chips used in automotive systems – supply has been limited by COVID– closures of related factories in Asia, where many of them are carried out. Last week the the Wall Street newspaper estimated that due to the “flea famine” some seven million cars were not built.
Last Thursday, Gina Raimondo, Secretary of Commerce, hosted an industry summit on chip shortage, with executives from companies such as Ford and General Motors, as well as Apple and Samsung, who are also competing. for semiconductors. Subsequently, his office said that one of his goals was to build “confidence” in the supply chain. (Another is to explore how the United States can become less dependent on foreign suppliers.) A White House briefing released the same day said the chip shortage was “hampering the US economy” and cited an estimate according to which it could bring down a percentage point of GDP growth.
What is often at the heart of a supply chain problem is a workforce issue. Last week, the ports of Los Angeles and Long Beach approached a state of crisis as more than seventy container ships idled offshore in what had become a marine parking lot; there are not enough dockers to unload their cargo, nor enough truck drivers to get it out of the ports. (Shipping rates have also gone up.) Labor shortages are the reason so many things just seem to be in the wrong place – the main symptom of a squeeze in the supply chain. Just-in-time delivery only works if you can deliver.
The work situation is also undoubtedly linked to COVID-19, but there is wide disagreement on exactly how. A significant number of people who were laid off at the start of the pandemic due to closures have not returned to work, even as more companies are reopening. Factors cited include a fear of infection and an aversion to dealing with customers who are angry with, or lack of, policies requiring masks and proof of vaccination – of particular concern to restaurant workers, who are also in short supply. Some essential workers, such as caregivers and delivery drivers, who have been hit hard by the pandemic, could re-evaluate their jobs; and many of the more than six hundred thousand people who died from COVID were part of the workforce. Professional calculations have also taken place among the highest paid workers. Transitions require mobility and time. And, even with schools reopening, a shortage of affordable child care (and child care) means some parents who want to return to work cannot.
Many of these circumstances, including the lack of child care services, were not so much caused by the pandemic as by it. (The same could be said of another shortage: affordable housing.) The question of how to solve the work problem cannot be solved without an examination of values and priorities. Would it be better to persuade people to fill jobs by further cutting unemployment benefits, or by increasing the federal minimum wage, which is still $ 7.25 an hour, or by increasing wages in general? What about adding support for child care, paid family leave, and public transportation – measures currently being debated in Congress – or increased immigration?
Referring to supply chain issues, in other words, can be a useful shortcut when a problem arises, but it’s not enough. Besides, associating the collapse of the supply chain with the pandemic can be an escape. Last week at the Council on Foreign Relations, the Irish Taoiseach, or Prime Minister, Micheál Martin, said the multiple supply chain disruptions created by Brexit had been “masked by COVID. “(The UK has faced shortages of everything from fuel to carbon dioxide needed to process many foods.) Likewise, recent storms have caused major disruption; one estimate is Hurricane Ida alone destroyed a quarter of a million cars.
Such severe weather events are a reminder that pandemic supply chain disruptions may be pale compared to those that will be associated with the climate crisis in the years to come. Indeed, one of the most urgent tasks now may be to think about both questions together. Either way, the rush for quick fixes (cleaning broken power lines, restocking pulp) can distract from the need for systemic change. The real challenge when it comes to thinking about supply chains isn’t making sure a container ship is unloaded. It’s deciding how we want to live. ??