If you’ve been in any stores lately, or tried to buy something, or even just listened to the news, you’ve probably heard the term “supply shortage” thrown around. The supply shortage has dominated much of the public sphere lately, much in a manner similar to the fictitious “worker shortage.” People on the news won’t shut up about it, fingers are pointing every which way, and the average person listening to those sources will probably have an opinion about what the true cause of the supply shortage is.
We have facts. We know that hundreds of container ships are backed up outside US ports. We know that there’s a complicated system (in hand changes) that this cargo must go through, from longshoreman, to truckers, to railway workers.
But it isn’t. And a lot of people are wondering “Why?” as every step of that chain does its best to point fingers at the other. The Port of LA says that the truckers, the railways, the laws, and the ships are at fault. The truckers say that the railway, the port, the ships, and the laws are at fault. The railways say … eh, you get the idea.
Increasingly, people are coming up with their own theories and ideas on “Why?” Just this week, in a conversation that inspired this post, someone told me that they believed the whole thing was a conspiracy. By who they weren’t sure (or they didn’t want to say), but their logic behind such a determination I found quite interesting. They stated the following: ‘Well, it worked before. Why isn’t it working now?’
The answer, which I wasn’t given the chance to give them, is complex. But it boils down to this simple summation: It didn’t work before. It hasn’t for years. What we were seeing was the result of momentum from when it did work, slowly grinding to a halt as each error accumulation built up. So that when a big error came along and finally brought the whole system to a start, we discovered that it was too broken to start again.
Hit the jump. We’re going in.
Okay, to start with, I want to show you this neat, quick little video on error accumulation. It’s less than a minute long, summarizing the findings of a Japanese experiment with so called “traffic shockwaves.” Here, take a look:
If you’ve ever been on freeway or a highway slowing down for no discernable reason and wondered why, this video is the answer. With some systems, small errors, small enough that they may seem like nothing, add up over time and expand. There’s actually a mathematical formula associated with it when it comes to traffic as part of the data from this and other studies. Basically, you have a freeway of cars all going seventy miles an hour, until one driver, not checking their blind spot, almost merges into someone else. Neither car collides, and there is no accident, but both slow as a result. The car behind them has to slow, and then the car behind them, and then the car behind that … Until long after the cars that caused the slowdown have gotten back to speed, cars miles down the road behind them are still being forced to slow down.
Worse, this compounds. The first cars may lose only five MPH worth of speed, but the cars behind them will lose a little more, and a little more, and a little more down the line until the wave hits either a gap in traffic where there are no more cars to slow, or until all the cars are traveling already at the speed the lowest value reached.
I’m simplifying slightly (there’s a lot of math and other variables involved) but this is how it works. Now imagine how often something like this occurs on a freeway. Near misses, close calls, people slowing down for just a second because they became distracted … There are a myriad number of reasons for traffic to “fail” and the resultant wave to resonate down the highway.
In fact, you can actually see waves like this persisting long after the accidents causing them have been cleaned up and vanished, cars forced into tight, slow packs miles and hours away by a single event that has long since ceased.
Why does traffic function at all? Well, because we, as humans, have grown used to the system being this way. So we work around it. We leave earlier, temper our expectations, and just file it away as “Well, that’s how this works.”
But the truth is, people are pretty bad at making traffic efficient.
So then, what does this have to do with the supply shortage we’re seeing right now. Well, you know how earlier I said that all the various groups involved are pointing fingers at one another? And this person I was talking to said that it was all a conspiracy because it ‘worked until now?’
Well, here’s the thing. It didn’t work. Not in wellness. What we saw was an engine running while busted that, once it was forced to stop, wouldn’t start again easily because it had long since not had the proper maintenance.
Bear with me here. All those pointing fingers pointing at everyone else saying “the supply shortage is cause by _____?” They’re all right to one degree or another. Save that the one finger they’re not pointing is the one that points to themselves.
See, there’s truth in all of them if you look. Are America’s ports some of the least advanced in the world due to anti-automation dockworkers unions keeping them from technologically advancing for almost seventy years to the point that even third world countries have better and more advanced ports than ours? Yes.
But is the railway system ill-prepared to deal with the cargo coming in? From what I understand, also yes. Are the laws on trucker licensing making it hard to acquire workers? Again, yes. Are the companies in charge of said truckers being greedy and paying so low with no benefits or future in order for managers to maximize the length of their compensating yacht to the point that no one is taking the jobs?
This isn’t one area’s fault. It’s all of them. Which in turn, brings us to the next logical question, that stated by the individual who spawned all this. If this is true, then why did everything work until now?
Well, again, it didn’t. To be more precise, it couldn’t. Let me offer an example by once again going back to cars (which are really good for both analogy and metaphor).
Have you ever driven a car with a bad battery? Or a bad alternator? It’s a curious experience, isn’t it? The car will run in a fairly normal fashion … but only once you get it going. The moment the car stops and the engine is turned off, it won’t start again because it’s broken in a fashion that prevents it from once again returning to life.
Cars can have a whole host if issues like this. There are cars that have idle problems: As long as you keep them above a certain RPM, the car is fine. But if you let them idle to low, say while waiting at a stoplight, the engine will die. You can start them back up again … but you’ll have to rev them fast or the engine will die again.
Or maybe they have even worse starting problems. Maybe the only way to start them is to get them up to speed down a hill and “kick” the engine into turning over. Or maybe there’s an improper wiring problem, where the vehicle’s electronics are sapping the actual engine and slowing it down through power loss.
Point being, there are a lot problems that an engine can suffer that result in the engine running sub-optimally, but with the caveat that if the engine is powered down, it will not be able to turn on again. Or if it slows enough, it begins to “crash” and starts a downward, sputtering spiral from which it cannot escape without external assistance: a jump, a boost, a push … anything like that.
This limping, wounded state? Well, by now you might have guessed that this is what “worked” before Covid-19 came along. The supply system in the United States ran on a “Just in time” philosophy, where everything had been pushed to the absolute limit in the name of saving a buck by every group. “The car won’t start again without a jump? Well, we never planned to turn it off. You can remove that battery while the engine is running, right? It’ll save weight! Bad alternator belt? Well, if we leave a little earlier we can still limp along while using the heater. Engine might die if we lower the RPMs? Fixing that would take money and stoppage, and we can’t have that! Just never stop!”
“Surely a scenario could never come along that will force our hands! And all that money we would have wasted fixing things can instead go where it’ll serve best: Management’s pockets!”
Ridiculous? Foolhardy? Yes to both. But accurate … Well, also true. The downside to adopting a form of corporate capitalism that only cares about the bottom line and no other considerations means that things like “preparedness” or “security” fall by the wayside. After all, that money could help someone else in the future, but all that matters is more money now.
The end result? Well, we’re seeing it right now. The US supply chain was limping along, functional, but also the equivalent of a car that couldn’t be allowed to stop or it would need massive work to start back up again. But of course, the odds of that were so, so low.
Then along came Covid-19. A massive pile-up on the highway, every car forced to slow down. And stop.
Now we’re seeing what cars can’t start again without outside assistance because “Hey, that battery costs money! Why have it at all? It’s not like we’ll ever stop!”
Only we did. We had to. And now? Current generations get to pay for the short-sighted greed of generations past. The Dockworker’s Union, for example, has been fighting against modernization since the 50s. That’s multiple generations of problems piling up that now have to be paid for by someone else.
And paying we are.
So, what’s the takeaway here? Well first: Spread the blame out fairly but equally. All sides are right that the others play a part. For change to happen, we must look honestly at what needs to be fixed. But that means fingers need to point back as well as forward.
Second, we need to reconsider how much we value our supply chain moving forward. Maybe it’s time to invest in fixing some of those problems. Because if Covid-19 is all it takes to hamstring the entire US supply system, imagine something twice as deadly and how much havoc it would wreak.
Fix the engine. Actually, the whole car! Don’t dump government money at it to jump it and absolve all the corporate stooges of the problems they’ve created. We have to suffer the lumps they’ve given us, but we can choose not to let them come again.
Let’s build a supply system that won’t suffer traffic shockwave at every step, shall we? We’ve lagged long enough.