What if the things we need aren't there when we need them?

 

The past few weeks have shown us (as if we needed to be shown yet again) how fragile our "normality" is, in economic and supply terms.  Consider these headlines from just the past couple of weeks:

• Suez Canal blockage reportedly costing $400 million an hour
• Toilet Paper Is Next Likely Victim of World’s Container Crisis
• 'Chicken-and-egg effect' adding pressure on already stressed US importers
• Push to prevent next meat shortage hits big obstacle
• Why the World Is Short of Computer Chips, and Why It Matters

I could go on with more examples, but those suffice to show that our supply chain from raw material production, to shipper, to manufacturer, to assembler, to distributor, to retail outlet, is under very heavy stress.  There's no sign of the situation easing, either, because new shocks - like the Suez Canal closure, resolved only yesterday - keep adding to the burden.

Basically, the one word that describes our supply lines is "fragile".  There are too many points at which they can be interrupted, and many of those points are, or have been recently, under siege.  All too often they've been interrupted, with dire consequences for those affected.  (Witness the effect of February's blizzard in Texas on the world's supply of computer chips for vehicles, and on production of key chemicals and certain types of plastic.  None of those areas have yet returned to full production, and downstream consumers - particularly factories and production plants - are hurting.)

Yesterday Bill Blain noted:

On Sunday I spoke with one of my old racing yacht crew who is now doing extremely well in Global Shipping. I asked if there was anything we were not being told, or what the real story of the ship blocking the Suez was. He was cagey but told me... “If you need Garden Furniture, buy it today” ... The key-thing is what happened on the Suez demonstrates is just how easy it would be to block the bottlenecks of global trade. Everything from consumer tat to chips would be stressed.

. . .

Western Economies are dependent on long exterior global supply chains to fuel demand for more and more consumer goods. We’ve become comfortable to click and deliver being satisfied from China. Stuck in lockdown we’ve heard disembodied voices warning of economic catastrophe, but we’ve been cocooned from the economic reality, relying on governments assurances they can prop up the Covid ravaged economy with subsidy and furloughs. Destabilise our supply lines, and the threat is a run on everything – potentially making last year’s pandemic panic look tame.

. . .

Western society has never been this unstable, polarised and disunited ... The economy of the West [has] bought into the promises of technological change and addressing the environment ... But the reality is economies have become increasingly bureaucratic, stultified by regulation, and held back by political gridlock and polarisation. Infrastructure is old and tired. Key skills and capacities have been lost.

Let me present a tiny example – speciality steels. Without speciality steels for the fine work of tech, the economy will ultimately wither and die. We are now entirely beholden to external steel. The UK government put plans to restore mining the key element of steel in the UK on hold. Without metallurgical coal – you can’t make steel. Fact. The UK prefers its steel to be made in China with Australian met. coal so it can say it’s tough on cutting carbon. The facts are simple – make the steel here, less carbon miles and more high quality jobs. Or…

But, the risks are not just in terms of physical supply chains. The digital economy is even more important and potentially even less protected. We’ve largely remained unaware of just how vulnerable we are ... The degree of interconnectedness in the global economy is extraordinary ... Increasingly companies realize it's not a matter of understanding their own vulnerability, but the vulnerability of all their suppliers, and hence, the whole digital supply chain.

There's more at the link.

Add to that the economic mismanagement being exhibited by the Biden administration, with the Federal Reserve printing money like there's no tomorrow to fund its grandiloquent schemes, and we can see all the signs of real economic trouble brewing.  Short-term "bubbles" such as the increase in house prices, the stock market rally, etc. are merely Band-Aids covering the worsening wounds caused by many other factors.  We discussed some of them recently.  They haven't gone away - in fact, many are getting worse by the day.

What this means is that we need to improve our preparedness to face shortages in supply as a normal thing.  They may be local or regional rather than national, but some will affect the whole country.  What's more, they're very likely to be more regular occurrences than they have been in the past.  Some will affect imported supplies more than US-made goods, but since many of our raw materials, consumer appliances, vehicles and their parts, etc. come from overseas, that's cold comfort.  (For example, have you any idea where most refrigerators, freezers, washing machines, etc., and/or their critical components and spare parts for them, are manufactured?  Yes, that's right - China.  Have you noticed how the pressure on international shipping from that country to others has impacted the supply - and the price - of such appliances?  There's a smaller selection of them in many stores, and they're often more expensive than last year.  Go check for yourself.  While you're at it, look at the prices of car parts, auto batteries, tires, etc. - most of them imported, of course.  Talk about sticker shock!  Note, too, that on a more strategic level, four-fifths of the rare earth elements used in this country are imported from China.  Among other things, we couldn't defend ourselves without them.)

Politics aside (and there's plenty to worry about on that front), more and more Americans are waking up to the fact that our economic and social situation is far from stable.  There are too many things going wrong at once, and too many threats to the status quo, to be complacent.  A few weeks ago, I quoted Frank and Fern's thoughts on the matter.

This is where we are. If you aren’t in a situation, location, state of mind where you can provide for your NEEDS, not wants, when the system implodes or declines to the point of not supplying the basics for everyday life, then please work diligently with all of your might to get that way. Sometimes the decline of a system is rapid, sometimes it’s slow and you can see it coming more clearly and make the needed adjustments. Everyone we talk to, everyone, normal everyday people that up to now didn’t have a care in the world, shopped everyday for dinner and went about their lives, KNOWS something is very not right. It’s in the air, in our bones, invading our thoughts and feelings. The world is not right. Something is coming.

Be as ready as you can. It’s important. It’s beyond important. It’s beyond words important.

Go read the whole thing.  I agree with them.

So, what practical steps can we take to prepare for shortages, particularly those of unknown duration?  I can't speak for anyone else, but here are some of the things that Miss D. and I are doing.  Our budget is very limited, but by selling things we don't need, we can partly compensate for that.

• I recently sold a rifle, and invested the proceeds in a second freezer and a larger generator, one capable of running both our freezers and our refrigerator at the same time, as well as a few lights and other domestic needs.  I'll keep both in our garage, complete with a professionally installed pipe to carry the generator exhaust outside.  If we suffer an extended power outage, as happened to much of Texas a few weeks ago, we should be able to save our frozen foods, and run lights and a heater if need be.
• I'll be selling another rifle very soon now, to invest the proceeds in meat and some other emergency foodstuffs to bolster our supplies.  Given the increasing price of meat, it makes sense to buy food of a known quality from a local supplier and freeze it, rather than have to rely on an uncertain supply at fluctuating prices.  By shopping around, we can get premium quality meat at a discount to most supermarket prices.
• Since our new generator will use more fuel than our present small unit (which I'll retain as a backup), I'll expand our gasoline storage.  My aim is to have enough to run our generator off-and-on for up to two weeks.  (Of course, I'll store the fuel outside our home, because of the fire risk.)
• We already have enough food in reserve to last for up to three months without resupply.  It'll be a bit monotonous (rice and beans may be nutritious, yet eating them day in and day out can be more than enough of a good thing!), but it'll do in a pinch.  I'm now going to consider what I can do to provide more variety (herbs and spices for flavoring, condiments that can add flavor and make food more interesting, and so on) and also increase our supply of key foods that won't deteriorate in long-term storage.  We don't have that much storage space, but if necessary I'm willing to rent a small climate-controlled storage unit to house the overflow.  If an emergency arises, I can move its contents into our garage at short notice with just one or two trips.
• We've already secured a 90-day reserve supply of all of our regular prescription medications.  I'm going to see about stretching that to 180 days.  That won't be cheap, but if necessary, I'll sell another item or two to pay for them.  Given the proportion of medications and their raw materials that come from overseas, that may be a very important precaution indeed.
• Automotive parts and consumables aren't cheap, but they're very vulnerable to supply interruptions.  If your car's battery goes flat, or your tires wear out, you'd better be able to get replacements - or you won't be going anywhere!  I'm giving thought to buying a set of tires now, even though we won't need them for a year or two, and doing the same with a spare battery.  I already keep enough (synthetic) oil and filters on hand for two oil changes.  I'll look into other critical parts (e.g. drive belts, spark plugs, air filters, etc.).  I'm no mechanic, but at least I'll be able to take the car to a mechanic, hand him the parts, and ask him to fix whatever needs it.

I can already hear some readers objecting, "But we can't afford them!  All those things will cost a lot of money!"  Yes, they will . . . but how much will it cost if you don't have them, or can't get them, when you need them?  That's the really important question.  I'm trying to do my best to prepare for what I see as a parlous supply situation in future.  I have little confidence that we'll be able to buy everything we need at will, as we've grown accustomed to in the past.

What about you, readers?  Are any of you preparing in the same way?  Please let us know what you're doing in Comments, so we can all learn from each other.

Peter