How goes the inflation fight?
The Joe Biden administration is drawing attention to its efforts to smooth supply chain bottlenecks and tackle prices.
It’s pushed the ports to work 24/7, fined ocean carriers for leaving cargo sitting on docks for too long and will offer $230 million in port infrastructure grants.
But, about those 24/7 port operations? “The ports are not operating 24 hours a day, seven days a week,” said Weston LaBar, head of strategy for Cargomatic, a digital trucking broker.
He said only a few port terminals have looked at the idea, and they aren’t there; 24-hour ports need 24-hour trucks, and that’s not happening either.
“When you look at hours of service and all of the federal restrictions as it relates to when drivers can drive and their reset hours, it’s really hard to dedicate resources to something that may or may not happen,” LaBar said.
Empty shipping containers have piled up, clogging ports and delaying truck traffic.
“I think a lot more needs to be done going into 2022,” said Jonathan Gold, vice president of supply chain and customs policy at the National Retail Federation.
Ultimately, ports are just one link in a long chain — from towns in the U.S. that don’t want another truck depot to factories in Vietnam that closed due to COVID-19 surges. Lurking behind all of it, the pandemic still has us spending our money on physical stuff, Gold said.
“The disruptions we see, part of it is because of the ongoing significantly increased consumer demand that I think many expect to continue well into 2022.”
What’s all this mean for inflation?
“Even if ports have opened up a bit more, we’re still going to see [the] inflation rate next year probably around 4%,” said Kent Smetters with the Penn Wharton Budget Model.
On the bright side, that’s down from the 6.8% rate in November.
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