A Christmas Without Gifts ?: Why US Seaports Have Collapsed

Dozens of huge freighters, packed with thousands of containers that are in turn full of products of all kinds, are being held off the coast of the United States. They wait for days – between 11 and 12 according to the authorities – that the ports of The Angels and Long Beach, maritime terminals that receive 40% of containers that enter USA, allow them to unload their merchandise.

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The image is repeated in ports such as Savannah, Georgia, and New York.

On land, hundreds of trucks expect the same. “There is a lot of congestion: you see many times that drivers arrive at 10 in the morning and leave at 8 or 9 at night with a single charge”, Gio Marz, truck driver and operations director of the cargo transport company Atlas Marine, told the EFE agency before the port of Los Angeles.

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The situation, which has been deteriorating for months, caused the US president to Joe Biden ordered Wednesday that the port of Los Angeles operate 24 hours, 7 days a week, uninterrupted.

The one from Long Beach has been doing the same for a few weeks.

The consequences of the port collapse range from the shortage of certain products to the risk of a significant increase in the price of others, all this in full economic recovery after the initial impact of the COVID-19 pandemic and a few weeks of festivities such as Acción de Thank you, Christmas or the famous Black Friday mass shopping event.

Dozens of huge freighters, packed with thousands of containers that are in turn full of products of all kinds, are being held off the coast of the United States. (Photo: Tim Rue / Bloomberg)

CAUSES OF COLLAPSE

Although the factors that have led to the collapse of the ports are diverse, the main one according to experts is the significant increase in demand for products, mainly through digital trade. According to UN figures cited by EFE, this type of trade increased by 4% globally during the pandemic.

The excess demand could not be logistically supported by the terminals. Analysts, companies and experts in the US economy assure that the supply chain has been broken due to the lack of carriers.

The closure of several transportation companies in the country has caused 100,000 truckers to stop working during the pandemic, according to the vice president of supply chain policies of the United States Chamber of Commerce, John Drake.

Truckers, for their part, assure that although there is labor availability, the fault comes from the quality of job offers they find. “There is no lack of labor, but there is a lack of quality jobs“Adán Álvarez, spokesman for the Teamsters union, which represents 1.4 million workers in the US in the transportation and warehousing industry, tells EFE.

“(The transportation industry) has exploited workers for several decades”He adds.

Analysts, companies and experts in the US economy assure that the supply chain has been broken due to the lack of carriers. (Photo: Robyn Beck / AFP)

POLITICAL IMPACT

On Wednesday, Biden tweeted that his Administration “works 24 hours a day to move more goods, faster and strengthen the resilience of our supply chains”.

The president’s message seeks to calm a citizenry that, according to the latest Ipsos survey for Reuters, considers the economy as the issue that most worries them, says an article in the Spanish newspaper “El País”.

Therefore, the efforts do not stop from the White House. Over the past few days, Biden has been meeting with executives from mega-chains Walmart and Home Depot, as well as unions and other supply chain actors to alleviate bottlenecks at ports.

In August, they also named veteran transportation official John Porcari as “Sent“To the ports to deal with the problem, according to Reuters. The Biden Administration is also seeking to emergency restore idle rail yards so that more containers can be stored.

Over the past few days, Biden has been meeting with executives from mega-chains Walmart and Home Depot, as well as unions and other supply chain actors to alleviate bottlenecks at ports. (Photo: Leah Millis / Reuters)

Republicans, for their part, have not missed the opportunity to criticize the Government by stressing the possible shortage of products for Christmas and the increase in inflation levels. According to the latest forecast by the Federal Reserve, the inflation rate for this year will be 4.2%, exceeding its objective of 2%.

Additionally, the Labor Department notes that Americans earned 0.9% less per hour during August compared to last year, due to inflation.

A senior White House official acknowledged to Reuters that “there will be things that people will not be able to achieve”For the end of the year parties. However, he stressed that this shows that the historical economic support ordered by the Government to face the pandemic worked.

Biden allocated 1.9 billion dollars in economic support to small businesses and households in the face of the health emergency.

The same official also urged that the population not panic. “It is expected that many of these products (which will not be available) will be substitutable for others […] I don’t think there is any real reason to panic, but we all feel the frustration and there is a certain need for patience to help achieve for a relatively short period of time.”He told Reuters.

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