By Jim Geraghty
Thursday, October 03, 2024
In about as vivid an example of the “MacGuffinization
of American Politics” as you’re ever likely to find, this morning the New
York Times writes, “Scenes of striking workers, hurricane devastation
in the Southeast and missiles over Israel represent a rare moment of turbulence
for Kamala Harris.”
Yes, but this is also a “moment of turbulence” for everyone
else, and perhaps a lot longer than a moment. For Harris, the International
Longshoremen’s Association strike that has shut down every port on the East and
Gulf Coasts is a political headache to overcome. The Democratic candidate has
to finesse the reflexive, unthinking pro-union stance of Joe Biden and the
ludicrous demands — a 77 percent raise for workers and zero automation — coming
from Harold Daggett, the ILA boss. The guy who enjoys a $900,000 salary and
drives a Bentley boasted that his strike would “cripple” the economy. (More
on him below.)
The strike and the resulting panic buying are the reasons
plenty of Americans already can’t find toilet paper, paper towels, meat, and
other products on store shelves.
Fears of supply shortages triggered
by the strike by the International Longshoremen Association have led to some
panic-buying in Hampton Roads, leaving gaps on grocery store shelves
reminiscent of the early days of the pandemic. . . .
The first shortages will be felt in
fresh foods such as bananas and other perishables that aren’t grown as much in
the U.S., according to Jeff Smith, an economics professor at Virginia
Commonwealth University who focuses on supply chain management and analytics.
Those effects could be felt by the
end of the week, he said.
At a handful of grocery stores in
Mobile on Wednesday, shoppers could be seen with several packs in their carts,
but the lack of toilet paper does not seem to be a direct result of the strike.
Some shoppers said the item was already on their grocery lists, but others said
they were looking to stock up in fear that there will be a shortage.
Lisa Lea said she saw this
firsthand at the Sam’s Club in Deptford, New Jersey, on Tuesday. She was among
those who went to stores to grab essentials after hearing about the port
strike, but found that bulk items of toilet paper and paper towels had been
already cleared out.
“Everything was gone,” Lea said.
“Another customer in here just told
me the whole meat section was wiped out,” said Kristal Hillie, who was shopping
at the Super Lo grocery in Southaven.
Bottled water and toilet paper were
top items, as fear of shortages sparked a wave of frenzied buying with Houston
shoppers.
Long lines have been reported at
retail stores across the city as shoppers scramble to secure essential goods.
Social media is flooded with images of empty shelves, particularly in the water
aisles, just hours after stores open.
Here’s the irony: No matter how long the strike goes on, toilet paper should be easy to find. “It is . . . a very
domestic product: 90% of what is consumed in the US, comes from the US (and of
the 10% that is imported, most is from Canada and Mexico).” That means it gets
moved by trucks, and never has to come off a ship at the docks.
This morning, you can find lots of headlines like, “Shoppers urged not to panic buy amid port workers strike”
and “Why there is no need to panic buy products during the port
strike.”
The problem is that, if a bunch of other people in your
town are going to the stores and buying a lot more products than usual, then it
makes sense for you to go do the same to ensure you don’t run out in your home.
You don’t know if there will be any on the shelves a week from now or beyond. A
perceived shortage increases demand as much as an actual shortage.
Meanwhile, the backlog of ships waiting, or diverting to
other countries, is only growing:
“Each day that this goes on it
creates a backlog of containers and ships,” American Farm Bureau Federation
economist Daniel Munch told CBS MoneyWatch. “A 3-to-5-day strike will take two
weeks to clear — if it goes into three-week territory, it will be early January
before it gets cleared.”
Today is Day Three.
Here’s the assessment from those in the shipping industry:
The backlog of vessels has built
quickly over the past days according to Mirko Woitzik, Global Director of
Intelligence for Everstream Analytics. Their analysis shows that the number of
ships waiting grew roughly 20 percent in just the first 24 hours of the strike.
Woitzik highlights it went from three vessels waiting on Sunday, to 31 on
Monday, 38 yesterday the first day of the strike, and 45 as of Wednesday
morning.
The number of containers now
trapped offshore Woitzik calculates has surpassed 300,000 TEU having doubled in
just the past two days. The expectation is that the volumes will continue to
grow exponentially in the coming days.
Note: A “TEU” is a twenty-foot-equivalent unit, basically the large containers you usually see on cargo ships.
“The queue could easily grow to 100
by the end of the week as more containerships are on their way,” says Woitzik.
Over 200 containerships with a total capacity of more than one million TEU will
have arrived at U.S. ports by the end of the first week of the strike according
to data from eeSea.
There are a few examples of ships
already diverting while others appear to be lingering in Europe or away from
the U.S. The NYK Demeter (4,888 TEU) for example omitted Port
Everglades, Florida from its schedule with the carrier reporting it will
instead discharge cargo in Halifax next Monday. Stadt Dresden (2.741
TEU) departed Norfolk shortly before the strike began and skipped a scheduled
stop in Savannah, instead starting its return trip to the Mediterranean.
Woitzik also highlights that there are more than a dozen vessels already in the
anchorage off Freeport in the Bahamas.
Hey, let’s look around at other parts of the country.
Philadelphia NBC10’s Deanna Durante: “For some of the major
stores, those big box retailers, they likely have warehouse products, got it
here sooner, or maybe are using West Coast ports, where the workers aren’t on
strike. But locally, smaller retail stores, those mom-and-pop businesses, some
of them tell us they already have goods sitting, waiting at the dock.”
The Charlotte Observer: “Bananas, imported wine and beer,
coffee and car parts — there’s a long list of items consumers across the
Carolinas might struggle to find in coming weeks.”
Sina Golara, an assistant professor
of supply chain management at Georgia State University, echoed Smith’s
concerns. “The first impact will be delays,” Golara said. “A delay causes
shortages, shortages cause prices to go up, and then consumers will be frustrated
trying to find their products.” . . .
“Businesses would pass on their
cost increases to the consumer,” Golara said, adding that extra pressure on the
supply chain could spill over to other parts of the economy.
Hmm, Pennsylvania, North Carolina, Georgia . . . do you
feel like you’ve heard a lot about those particular states lately? Like they’re
important in some way?
Besides those states’ being three of the seven key swing
states in this election, vast swaths of North Carolina and Georgia just endured
the second-deadliest hurricane in five decades. Who needs additional economic
hardship at a time like this?
Leslie G. Sarasin, the CEO of the Food Industry
Association, reminded the world that this strike is particularly ill-timed for the
Southeast:
We must be focused on helping the
communities and people devastated by Hurricane Helene. The strike on the East
and Gulf Coasts by the International Longshoremen’s Association threatens to
make the situation even more dire. This action has already begun to jeopardize
food supply chain operations, and the strike has the potential to disrupt the
long-term stability of markets and commodities, namely pharmaceuticals,
seafood, produce, meat, cheese, ingredients, and packaging.
An extended strike will likely
cause dramatic increases in the cost and availability of goods, intensifying
this inflationary environment. And, unfortunately, this situation cannot be
addressed by a switch to alternative ports due to the freight costs and time
associated with transporting products back to the East Coast.
In Harold Daggett, head of the ILA, the port managers and
the rest of the country are dealing with someone who is fundamentally
unreasonable. As the New York Post reports, last month Daggett fumed about
the automated tolls that have been in place for a generation:
“Take E-ZPass. The first time they
come out with E-ZPass, one lane, and cars were going through and everybody
sitting in their car and go, ‘What’s that all about? I’m going to get one of
them.’ Today, all those union jobs are gone, and it’s all E-ZPass. People don’t
realize it, everybody’s got three cars, everybody got an E-ZPass on the window,
and they go through like it’s nothing, and they get billed in the mail. They
didn’t care about that union worker working in the booth.”
No, we don’t, because we want the most efficient and
least expensive systems possible to best serve the most people possible! Nobody
wants to endure a slow, inefficient, frustrating daily life just to preserve
some union job!
E-ZPass was created in 1987 and became increasingly
common on the East Coast throughout the 1990s. Think of all the time saved,
think of all the gasoline saved, and think of the reduction in carbon-monoxide
emissions from people sitting and idling while waiting for slow toll
collectors. Harold Daggett hates the fact that your life is easier. He wants
you back in the mid ’80s, sitting in traffic, waiting for the unionized toll
collector to count out the dimes and nickels.
And it sounds like increasing automation at U.S. ports
would do to them what E-ZPass did to East Coast traffic and toll collection.
Peter Tirschwell
of S&P Global Market Intelligence notes the basic cost to lift a
container off a ship is higher in America than anywhere else in the world.
Ports elsewhere are more automated, cheaper and more productive (measured by
the number of lifts on and off a ship per hour). According to a container-port
performance index published by S&P and the World Bank, no American port is
in the 50 most productive ports. The highest-ranked American port is Charleston
at 53. It is no coincidence that Charleston is one of the less unionised.
A key point from the editors of National Review:
The Taft-Hartley Act is already
working, even though Biden has so far refused to use its strike-ending
provision for economically harmful strikes. In many other countries, a
dockworkers’ strike could spiral out of control by spurring solidarity strikes
across the economy. The Teamsters, freight-rail union SMART-TD, West Coast
dockworkers’ union ILWU, the Association of Flight Attendants, and the United
Auto Workers have all pledged their solidarity with the ILA, but Taft-Hartley
prohibits them from actually going on strike by limiting legal strikes to
disputes between employers and employees.
This provision in the law reflects
the commonsense intuition that workers and customers in other industries should
not be harmed by a labor dispute that they have no role in. Taft-Hartley
protects those innocent bystanders by forbidding solidarity strikes, and the
American people are better off for it.
It cannot be emphasized enough, and everyone in politics
should be screaming this from the rooftops morning, noon, and night: President
Biden could end this strike immediately with a stroke of his pen.
He just doesn’t want to do it. Instead, Biden is calling on management to meet all of Daggett’s demands:
THE PRESIDENT: Look, there’s a —
there’s a consortium of mak- — basically six owners that control all the ports
from all the way to the East Coast, down around the Gulf. And — and they’ve
made — they’ve made incredible profits — over 800 percent profit since the
pandemic, and the owners are making tens of millions of dollars in this.
The last thing they need is to
profit off of this. It’s time to — for them to sit at the table and get this
strike done.
Q: Will you be communicating with
them directly about any of this?
THE PRESIDENT: Oh, we have. We
have. I haven’t personally, but we have. . . .
Q: Sir, do — do you — sorry. Do you
have a view on the workers’ fight for restrictions on technology or automation
for the dockworkers?
THE PRESIDENT: No — look, they just
need to sit down and talk, because I — remember, we negotiated a similar strike
on the West Coast before, and they worked it out. It’s time — they won’t even
talk. So, let’s get that done.
The irony is that the dockworkers’ strike is just about
the best friend Donald Trump could ask for right now and, as the Times suggested,
a major headache for the Harris campaign. If everybody’s frustrated by higher
prices and empty shelves in the coming weeks, does that make voters feel
happier or less happy with the incumbent party? The strike is terrible for the
hurricane victims, terrible for the economy, and terrible for the country as a
whole. But as if that wasn’t bad enough, it’s terrible for the Democrats.
Why can’t the almost-82-year-old president see the logic
of this? What’s it going to take to slap some sense into him?
ADDENDUM: Joe Klein, author of Primary Colors
and longtime political correspondent, fumed
that Tim Walz botched his big moment in the vice presidential debate:
We saw the high school studies
teacher destroyed by a professional politician last night. This wasn’t as bad
as Biden’s debilitated performance in June, but it was close. Tim Walz was
incompetent. Actually, he was worse than that: he was a willing accessory in
the resuscitation of a mortal sleazeball, J. D. Vance. He treated Vance as if
he were a moral equal. But that’s what liberal social studies teachers do: they
can’t grock cynicism, they can’t imagine the poison that untrammeled ambition
can inject into a formerly intelligent person. Minnesota nice turned out to be
Minnesota gullible, Minnesota dumb. Minnesota weak.
. . . Walz was weak and confused.
He was not a leader. And, one wonders—for me, for the first time—why Kamala
Harris chose this softie rather than a vice president who might really go after
the miscreants on the other side. I hope other people aren’t asking that
question. . . . But tonight made Donald Trump’s path back to the White
House—and he is the American antichrist—a little bit easier.
Now, when even a guy who calls Trump “the American
antichrist” thinks your debate performance stank, you know you really fumbled
it.
By the way, if Walz is such a disappointing,
underperforming softie, what does that tell you about Harris’s judgment?
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