‘People can’t buy what can’t be delivered’: Addressing Global Supply Chain Vulnerabilities

April 14, 2021 by Kate Michael
A cargo ship calls on the Port of Charleston, S.C. (Photo by Dan McCue)

WASHINGTON — We all remember last year’s short-term stampede for toilet paper. But while stores were able to eventually restock personal products and cleaning supplies, will we be able to do the same with a shortage of semiconductors and other strategic priority goods essential to the nation’s interest?

Not only the pandemic, but trade disputes and climate concerns continue to highlight the risks of current supply chains and force nations to think about the affordability and accessibility of products and trade routes.

“Our country just went through this massive once-in-a-generation stress test,” Rep. Mike Gallagher, R-Wis., shared during a virtual discussion hosted by the non-partisan Wilson Center policy forum. “One of the biggest and enduring effects [will be] to accelerate the discussion of shoring up supply chain vulnerabilities.”

While the pandemic placed significant strain on global commerce, other factors are also at play forcing companies to evaluate operations moving forward. 

Reducing costs was a priority pre-pandemic. Now, retired Ambassador Mark Green who serves as Wilson Center president, director, and CEO said it no longer makes sense to focus purely on low-cost strategies. “People can’t buy what can’t be delivered,” he said.

Now, the seamless movement of products across borders can’t be taken for granted and the inherent weaknesses of globalization must be taken into account. 

“We need to go through what we’ve learned,” said Gallagher, suggesting the nation work with international partners to mitigate serious supply chain vulnerabilities through cohesive, sustained efforts. “We need the right framework for identifying what’s actually critical.”

Green agrees that the nation needs international partners with secure economic links and shared data as a “matter of smart power” to work toward making supply chains more transparent, more reliable, and more resilient. “Our strength isn’t merely derived from hard power, but also from the genius of market economies,” he said. 

“Canada, the U.S., and Mexico share some of the most sophisticated supply chains in the world,” said Chris Sands, director of the Wilson Center’s Canada Institute, pointing not only to collaborative logistics networks for consumer goods like automobiles, but also defense products and technology. He said those systems didn’t happen on their own, however, but were created through a series of conscious efforts and trade agreements knit together. 

Creating more smart supply chain partnerships like these requires transparency, agility, and “doing a better job of data mapping trade,” said Sands. He said it would help if publicly collected data was available to the private sector, but that cybersecurity leadership and regulatory mutual recognition — “cutting the duplicative red tape of regulatory standards” — were also strongly desirable. 

As lines between military and trading partners are disappearing, “we can’t afford to have our defense industrial base experience the same supply chain disruptions as our medical industry did last year,” said Sands. 

And certain potentially nefarious actors are already poised to weaponize key supply chains and using economic language suggesting they may be prepared to act on it.

“The Chinese Communist Party… will use any and all supply chain [influence] to put our economy at risk,” said Sands, reminding that China controls many critical resources, including rare earth minerals, mining, and energy resources essential to the future world economy. The U.S. also has a dangerous over-reliance on Chinese manufacturing of essential goods for national health, as the pandemic’s early shortages has shown. 

Modern supply chains must take all of this into account. Efficiency must now be met with competitive resilience and the ability to adjust flexibly and quickly with like-minded fair-market partners.

“The best way to compete with China in the long-term is to take the offensive,” said Gallagher. But instead of resource nationalism or a “Buy American mentality,” he said the nation should adopt an out-compete mindset and “harness that Buy American energy into a free-world framework.”

In The News

Health

Voting

Economy

$28.6 Billion Restaurant Revitalization Fund Open for Enrollment
Business
$28.6 Billion Restaurant Revitalization Fund Open for Enrollment
May 3, 2021
by Reece Nations

The Small Business Administration began accepting applications on Monday for the Restaurant Revitalization Fund, a program authorized in March by the passage of the American Rescue Plan Act. To receive funding, businesses must submit their application to the SBA on a first-come, first-served basis at restaurants.sba.gov.... Read More

Republicans Claim $15 Minimum Wage Would Hurt U.S. Jobs and Businesses
Congress
Republicans Claim $15 Minimum Wage Would Hurt U.S. Jobs and Businesses
May 3, 2021
by Tom Ramstack

WASHINGTON -- The Biden administration’s pledge to up the wages and fair labor standards of low-income workers hit a roadblock among Republicans during a congressional hearing Monday. The intentions are good but the economics are bad, according to critics who say the plan would backfire by... Read More

Yellen: Biden's Phased-in Spending Plan Won't Fuel Inflation
Economy
Yellen: Biden's Phased-in Spending Plan Won't Fuel Inflation

WASHINGTON (AP) — President Joe Biden's massive proposed spending on infrastructure, families and education will not fuel inflation because the plans would be phased in gradually over 10 years, Treasury Secretary Janet Yellen said Sunday. New economic reports have portrayed a surging recovery from the recession... Read More

Help Wanted: In Pandemic, Worry About Finding Summer Workers
Employment
Help Wanted: In Pandemic, Worry About Finding Summer Workers

BOSTON (AP) — The owner of seafood restaurants on Cape Cod has eliminated lunch service and delayed the opening of some locations because his summertime influx of foreign workers hasn't arrived yet.  More than a thousand miles away, a Jamaican couple is fretting about whether the... Read More

Lower Employment Figures Spur Concern for Airline Industry
Travel
Lower Employment Figures Spur Concern for Airline Industry
April 19, 2021
by Reece Nations

WASHINGTON — As the industry continues to rally back from the lifting of pandemic travel restrictions, some passenger airline companies are still struggling to retain full-time employees. February employment figures for airlines were down nearly 1% from January, according to a monthly report by the Department... Read More

Disease Experts Look to the End Of Pandemic But Aren't Sure When
Health
Disease Experts Look to the End Of Pandemic But Aren't Sure When
April 16, 2021
by Tom Ramstack

WASHINGTON -- As the U.S. death toll reached 564,000 from COVID-19, the nation’s top disease experts said Thursday normal life will return for Americans only when enough of them get vaccinated. But with more than 70,000 new infections daily, they could not predict for Congress when... Read More

News From The Well
scroll top