Supply chain problems are getting worse – and climate change is the biggest culprit

As the economy continues to falter, the name of the game is product shortages. Supply chain disruptions have cleared supermarket shelves, forced gamers to suffer console and headset shortages and led to microchip shortages in the electronics industry. Higher prices for consumer goods are partly the result of such shortages. As Republicans draw attention to a baby food shortage, the question seems to have become politicized: Should supply chain problems be blamed on the party in power?

The answer is that our supply chain problems are global – and in more ways than one. The product shortages are caused by the fact that most of our goods are transported over long distances to be used for production, sale or otherwise used. Imagine a giant spider web stretching all over the planet. Like a baseball breaking through every strand, unexpected problems can destroy key pathways that enable our supply chains to operate.

RELATED: Thanks to Climate Change, Supply Chain Disruptions Are Poised to Become the New Normal

It is therefore expected that climate change in particular will lead to much more product shortages. dr. Thomas Goldsby, a professor of supply chain management at the University of Tennessee – Knoxville’s Haslam College of Business, tells Salon that volatile and unpredictable weather patterns will fundamentally change our economy.

“The frequency and severity of these unpredictable weather patterns are changing consumer shopping behavior and the actions companies take to address them,” explains Goldsby. “Companies need to build more redundancy into their manufacturing and distribution networks to offset this volatility – all of which comes at a higher cost.”

In addition to changing consumer behaviour, scientists agree that climate change will change the physical landscape in profound and transformative ways. For starters, sea levels are expected to rise; even if that happens, heat waves will cause widespread droughts. Both things will affect the economy.

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“Take the alarmingly low levels of Lake Mead that supply essential water to parts of Nevada, Arizona and California,” Goldsby noted. “The water supply is cut off and farms lack essential hydration to make them viable. The quality of life for non-farmers is also being affected. I hear the term ‘climate refugees’ more and more.”

“Basically starting around the 1970s and 1980s, there was a dramatic acceleration of something that had been going on for a long time — the relocation of jobs.”

As is so often the case when it comes to climate change, marginalized communities are expected to take a disproportionate blow. As Shahram Azhar, an assistant professor of economics at Bucknell University, wrote to Salon last year that “climate change is demonstrably negatively affecting the planet’s natural ecosystem (pests, coral bleaching, etc.) and poverty due to rising food prices on the one hand and instability in jobs and incomes on the other.”

Tragically, not surprisingly, climate change will hit marginalized groups hardest when it starts closing supply chains. These expansive supply chains exist in large part because wealthy advocacy groups wanted to exploit cheap labor, said Richard Wolff, an economist emeritus at the University of Massachusetts Amherst. That is why supply chain breakdown can be described as a “global” problem in more ways than one. Not only is it heavily impacted by global events such as climate change, but globalization also causes supply chain disruptions.

“Basically starting around the 1970s and 1980s, there was a dramatic acceleration of something that had been going on for a long time – the relocation of jobs, initially in manufacturing, although it has since spread to services as well,” Wolff told. lounge. “And the driving force was profit, as always. Profit is the bottom line. Profit is the goal of business, because that’s what capitalism does. And thanks in part to the technology of the Internet and the technology of jet travel, which became normalized in those years years, it was now possible to take advantage, and there were also political conditions of much cheaper labor elsewhere in the world.”

“Capitalists are always incentivized, when wages rise, to find a solution, a way to avoid being paid,” explains Wolff.

As wages rose in Western democracies like the United States, companies realized they could increase their profit margins by manufacturing different products in different places around the world. With lower transport and communication costs, this would prove cheaper than using domestic workers. Once the inevitable long supply chains were created, companies could argue that this was an inevitable outgrowth of the economy, as opposed to the accumulation of conscious choices that probably wouldn’t have been made if our global economic system hadn’t been focused on profit.

“Capitalists are always incentivized when wages rise to find a temporary solution, a way not to pay them,” explains Wolff, explaining that this extends from automation to outsourcing jobs. In doing so, they leave consumers vulnerable to disruptions caused by environmental problems – and this even predates the era of climate change.

“When we created dustbins in different areas in the 1920s and 1930s, it permanently changed the landscape of this country in terms of where people live and work and so on,” explains Wolff, referring to a series of dust storms that affected the flooded the world. American Midwest as a result of poor farming practices. “Once you make it global by moving abroad, you naturally become vulnerable to droughts and floods and everything else that’s happening right now, not just in the continental US, but on a global scale. You either have to take the steps to change the climate.” avoid change, or you spend the money to accommodate the adjustment process that comes with it.”

Wolff added: “The problem with capitalism is that these problems cost time and money, and they don’t want to.”

For more Salon articles on supply chain issues:

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