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Home SITREP 10.04.2021

10.04.2021

by Survival Dispatch Staff

The Invisible Squeeze

The Truth About the Labor Shortage and Shipping Lanes

While it is hard to take our eyes off of the trainwreck that is the United States leadership, there are multiple international conflicts and issues coming to a head. It has become painfully obvious to the average US consumer that something is seriously wrong. While it is easy to explain away the rise in gas prices following the Biden Administrations’ total war on affordable fuel by canceling the Keystone XL Pipeline, banning fracking, and limiting drilling on federal land. 

The unprecedented rises in prices are not only limited to the fossil fuel industry though. Household appliances are up 29.4%, used vehicles are up 45.2%, and hotel costs are up 16.9% according to Business Insider. 

The supply chain issues that have repeatedly been used to explain these shortcomings all rest upon the Covid-19 pandemic. Mario Cordero, the Executive Director of the Port of Long Beach, which is the busiest port in America, explained on Fox Business that a major reason for the delays we have been experiencing is due to health protocols in Vietnam, China, and others. 

The problem with his assertion is that United States ports are still unable to handle the amount of traffic they are currently experiencing. There are dozens of boats anchored off of the coast of California waiting to be unloaded, and hundreds around the entire US. How would a delay in ships arriving at US ports cause those same ports to be unable to keep up with the supposedly diminished supply? 

Each green icon represents a ship, notice the gatherings around the major ports.

According to Economist Bill Conerly for Forbes

Pervasive supply chain disruptions result mostly from labor shortages, with transportation bottlenecks a much lesser factor. Here in the United States, imports totaled $2.3 trillion last year, compared to GDP of $20.9 trillion, Ships continue to be delayed in their arrivals and unloading at U.S. ports, but that’s not nearly as great a problem as the labor shortage. 

This labor shortage is the preferred result of the Federal Reserve. Their goal in the past year has been to run the economy so hot that employers will jump to hire anyone who walks past the business, even a high school drop-out with a prison record. Although we all want good opportunities for disadvantaged people, widespread shortages of goods and services, triggered by labor shortages, are the price we pay for the tight labor market today. These shortages will turn into inflation, which will be the price we pay in the future.

The Biden Administration is going to be hard-pressed to keep the lid on how drastic the supply chain issues are. The economic effect of 9 months of disastrous policies is just beginning to be felt. Individual companies are taking drastic steps to try and remedy the situation. As the Daily Mail reported in late September, 

Costco CFO Richard Galanti said on a call with analysts last Thursday that the company had hired three ships to carry goods from Asia to the US and Canada. The move will help them avoid spending the going rate of six times the average price on shipping or renting containers through a third party, according to Galanti. 

Each ship would have the capacity to hold between 8,000 and 1,000 containers at a time. The company has also leased ‘several thousand containers for use on these ships,’ he added.

The underlying issue, staffing shortages, will not be alleviated until the causal policies namely incentivizing unemployment are reversed. People in California under the passage of the CARES Act last year were eligible to make up to $750 a week, which is significantly above the full-time weekly salary at the “living wage” of $15/hr which progressive democrats have attempted to implement for years. 

Steve Horowitz, a professor at Ball State University, writes

the generous unemployment benefits and multiple rounds of stimulus payments have meant that workers can do better, or at least close to as well, by not working as they can by working. This will be especially true in the entry level jobs in the service and hospitality industries that appear to be having the most difficulties finding workers. If you can make more staying at home, why take a job?

The policies of the Biden Administration have made it harder for the United States economy to recover from the unnecessary lockdowns in response to the Covid-19 virus. Their determination to pay people to stay out of the workforce is largely responsible for the string of disastrous jobs reports beginning his tenure. 

Treasury Secretary, Janet Yellen’s statement that the Federal Government will run out of money on the 18th of this month is yet another indicator of the ineptitude of those in charge of the financial institutions of the country. If Bidens latest nominee to the finance leadership is confirmed by the Senate it will only become more radical. 

Nominee for Comptroller of the Currency, Saule Omarova, has a problematic past. As the Wall Street Journal reported

She graduated from Moscow State University in 1989 on the Lenin Personal Academic Scholarship. Thirty years later, she still believes the Soviet economic system was superior, and that U.S. banking should be remade in the Gosbank’s image.

“Until I came to the US, I couldn’t imagine that things like gender pay gap still existed in today’s world. Say what you will about old USSR, there was no gender pay gap there. Market doesn’t always ‘know best,’” she tweeted in 2019. After Twitter users criticized her ignorance, she added a caveat: “I never claimed women and men were treated absolutely equally in every facet of Soviet life. But people’s salaries were set (by the state) in a gender-blind manner. And all women got very generous maternity benefits. Both things are still a pipe dream in our society!”

If Twitter users are rightly calling you out for your ignorance, you have reached a new low so impressive it should immediately disqualify you from holding any position more complicated than cashier. 

It should be obvious we need to prepare for the impending economic crisis resulting from continued shutdowns, policies designed to sabotage, and Soviet economists in charge of the banking system. 

On Friday we will cover the advances China has made on Taiwan, India, Afghanistan, and other countries as they show their indifference to American leaders or military power.   

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