Was Covid the only reason for the shipping crisis and when will it stop?

 

Covid 19 has exacerbated global supply chains troubles

For a long time our ultra-connected global system supply chains have worked smoothly for just-in-time delivery. But now things are looking grim. There were double the number of container ships off the ports off the California Coast in September as there were in August, and congestion is worse in China. As someone said, it seemed to work well until it didn’t. Something happened. Toys won’t be arriving for Christmas in USA, New Zealand is short of chia seeds and turmeric and Irish builders won’t get their timber. To add to our woes, small and remote New Zealand has been victim of the post-pandemic business model reviews by global shipping and building supply companies. So New Zealand was dropped off their supply routes, with supplies getting only as far as Australia.

So was it already fragile to begin with, or did the upheavals of Covid make it so? When will it improve?

Three predictions are worth examining.

“Global shipping mess to last until 2023”, says Jackson Meyer, CE of an Australian freight forwarding company.

Secondly an overdramatic “City Prepping” guy (apparently called Kris, but it takes a hunt to find it) concludes in his YouTube story of 3 October 2021 that, “Barring new Covid developments, natural disasters, strikes at major ports, fuel supplies and panic buying things could begin to a sort of normal in 2022.”

Thirdly – and probably the most realistic forecast – Forbes produced a comprehensive summary of the problem September 3, 2021 and concluded there is no end in sight.

“A chain is only as strong as its weakest link, so the saying goes. When it comes to the current state of the global supply chain, weakness is everywhere. Massive dislocations are present in the container market, shipping routes, ports, air cargo, trucking lines, railways and even warehouses. The result has created shortages of key manufacturing components, order backlogs, delivery delays and a spike in transportation costs and consumer prices. Unless the situation is resolved soon, the consequences for the global economy may be dire.”

Forbes notes that various natural disasters already affecting the supply chain. “The ports of New Orleans, Baton Rouge, Gramercy, and Morgan City in Louisiana and the Port of Pascagoula in Mississippi remain closed following the recent arrival of Hurricane Ida.”

Severe rail disruptions after Hurricane Ida in Louisiana as well as port damage

Extreme weather from climate change add to the problem of supply chain disruption

And extreme weather events hit other sectors too. Hurricane Ida forced the Kansas City Southern KSU rail network to shut its main line in Louisiana.

And the trucker shortage isn’t going away either, despite a recent increase in wages. Even Walmart was offering twice the median salary of a trucker. As one truckie related in a YouTube video, “Because of Covid, we are stuck in our trucks all night and we ain’t got no food.” Forbes says, “According to driver recruiting firms, there is one qualified driver for every 9 job postings”.

And of course, all this is leading to inflation. Or more likely stagflation which is a rise in prices accompanied but no growth of jobs.

The number of container ships off the California coast keeps on increasing due to port congestion

Now looking back at the prepper’s four provisos, it seems:

  1. There isn’t a guarantee that we will have no new Covid variants. It seems there are seven already and Delta looks the worst so far. But Mu and Lambda and C.1.2 also exist. Mu, discovered in January 2021 is in 45 countries already.
  2. Given climate change, there will be no end to the weather disruptions of supply chains so forget that. Just read your IPCC reports. They will get worse not better.
  3. Fuel supplies won’t stay the same. They will just get worse. The peak year for production of conventional oil was 2006 and for non-conventional oil over a decade later. Discoveries of big oil reserves are a thing of the past. Most oil producing countries have past their peak oil production. Although there are many factors to be added including political tensions as oil, gas and coal producing countries now tend to keep their fuel for themselves. Add to that the serious trade tensions with others, the general trend now is for prices to rise. Brent crude oil is hovering between $75 and $82 a barrel.
High prices for natural gas are shutting fertiliser plants in UK and this is having a huge effect on their meat and soft drink industry because they rely on the byproduct of fertiliser production

Already the natural gas supplies from Russia are closing down fertiliser companies in UK, and this has spread to Belgium, Germany, Austria and Norway. Since carbon dioxide is a by-product, it is affecting meat and soft drink industries. Natural gas is used in Britain and Europe for electricity generation and electricity prices are skyrocketing. This is affecting food supply from Netherlands’s greenhouses.

When it comes to coal, China’s coal sources changed after a spat with Australia. So while China searches for new suppliers, the price has risen, affecting power generation and closing down Tesla and General Motors and Apple factories and causing traffic light failures there. (Not to mention leaving households in the dark with no way to cook or heat their homes.)

It takes energy to get energy

Our over-dependence on fossil fuels is now slowing global GDP growth because, as we use up the easy to find fossil fuels, and progress to poorer quality oil, coal and gas it is taking more energy to get energy. It is more and more expensive to mine them. So there is less energy for the general economy. This happened well before Covid but few economists noted the energy issue.

4) Will panic buying stop? Maybe. In 2020 Covid caused a change in consumer buying habits but we don’t know if this will continue. During their enforced lockdowns of early 2020, many ordered online and there was a big surge in orders while manufacturers and docks had laid off workers, at the very time truckies were departing in their droves. As lockdowns appear to come in waves, who knows when or if this panic buying will cease.

Given these three scenarios, it is more likely the troubles will spread.

Deregulation and lax anti-trust laws didn’t help

But did all this happen just because of Covid? No. Guardian Journalist Matt Stoller in an article outlines the scenario before Covid. He explains the consolidation of power into the hands of monopolists over the last four decades has left us unprepared to manage a supply shock. “The lax anti-trust, deregulation of basic infrastructure industries like shipping railroads, and trucking, disinvestment in domestic production and trade policy emphasising finance over manufacturing.”

Four firms bought out the biopharmaceutical equipment industry over the last 15 years. Wall St consolidated 33 firms into just seven after 1980. Wall St-owned rail-yards cut their workforce and closed a giant Chicago sorting facility. Deregulation of ocean shipping brought consolidation into three giant alliances.

The truck driver shortage is also a story of deregulation leading to lower wages, worse working conditions. In semiconductors there is but one firm controlling the industry, Taiwan Semiconductor. And so on.

As you can see, before Covid, the ultra-efficient system of global manufacturing, transport and retail was already vulnerable in the extreme due to consolidation of power, lower net energy return on investment and extreme climate events.

And all it needed was the black swan of Covid. The interruptions have already lasted a very long time. It may be a tipping point from which the global economy cannot really recover. And it may be a strong sign that local communities and countries will have to manufacture essential items like shoes and cooking equipment themselves.

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Our Climate Shituation

Despite the alarming global environmental emergency, I am so looking forward to pohutukawas in full bloom in New Zealand

The problem with reading too much world news is that you notice so many freak weather events. As I write this, for instance, there are landslides in China, and the drought in Syria is getting desperate. The recent floods in Germany, says the Guardian, were nine times more likely to be caused by climate change than just by chance. The fires in California continue and there has been rain instead of snow at the top of a two-mile-high mountain in Greenland for the first time ever. Floods in Tennessee have caused deaths of twins lost from their mother’s arms and the death toll was rising. There is a flash flood warning in New Mexico. There are fires in Greece again. And in Siberia, Algeria, Lebanon, France, Turkey, Paraguay. The 14,000 foot Mount Shasta of Northern California was just photographed without snow for the first time ever.

Of course that’s when you only have one crisis. Afghanistan is facing three – conflict, drought and pandemic. Haiti has an earthquake, an assassination and a pandemic let alone dire poverty. The Danish Refugee Council says, “Water crisis and drought threaten more than 12 million in Syria and Iraq”. The crop failure in Zimbabwe from the drought in 2017/18 is still affecting food supply and the Red Cross there says, “There are an estimated 5.5 million rural Zimbabweans to be food insecure as a consequence, with 3.8 million people in need of food assistance.”

Stop! It is clear that we are in a pickle. Or as comedian Steve Bhaerman describes our predicament, we worry about “our climate shituation”. Anyway, that might be enough doom-scrolling for now and congratulation to those who have read this far.

Even in these times of uncertainty, the beauty of nature is there for us to marvel at

Climate and the growth imperative

I guess my new journey started this year when I worked on my submission to the Climate Commission. They were predicting virtually the same GDP in 2050 (27 years away!) while emissions had dropped. I thought about the material throughput and all the “chewing up the beauty and spitting out money” (as Charles Eisenstein would say) and I concluded you couldn’t tackle just one environmental problem at a time because the others persist. I argued their brief should be expanded to the whole future so that we had a Futures Commission again.

The  Climate Commission’s assumption of continued GDP growth in rich countries seemed nonsense to me. At the end of her book, “This Changes Everything” Naomi Klein wrote, “the economy is at war with the climate”. But GDP growth results in species extinction too.  What about food insecurity from loss of pollinators? Bronwyn Hayward of the University of Canterbury in 2018 commented, “Having heard the new Secretary-General of the United Nations say at the opening of COP that nothing in these reports, of maintaining it at 1.5C, will affect economic growth, I think we are still living in magical thinking.”)

Will green growth solve our climate shituation?

Over the last few months I have been to Extinction Rebellion websites and learnt about Degrowth. I read Jason Hickel’s Less is More and started a Degrowth column on my Tweetdeck. Would I try to start a Degrowth pressure group in New Zealand? Possible. Then during a Zoom meeting of the Living Economies Educational Trust Nicole Foss convinced me it wasn’t going to happen because it was wishful thinking that any politicians will advocate for this and expect to be elected.

Timothée Parrique, a leader in the degrowth movement has wryly tweeted, “The cool thing about working on degrowth is that everyone loves you. It’s overwhelming really. The idea sells like hot cakes, especially among economists who just cannot get enough of it.” Then he attached a list of examples of how they describe degrowthers – dogmatists, religious fanatics, anti-modern, misguided, wrongheaded, immature. Just imagine the derision that would follow from media and big business interests –and politicians of all stripes are very sensitive to the views of big business.

People asked me if I was writing a book and yes I have collected a lot of material. But I haven’t advanced it recently. I keep reading and thinking. I have understood the myth of green growth, about the declining return on energy invested (EROI) and how that makes the mining of oil and minerals more problematic, both environmentally and economically.

Looking for Components to make Electric Car Batteries. From Foreign Control Watchdog August 2021

After digesting a great article about the limits to mining of metals for renewable energy from a prominent geologist Simon Michaux I can no longer enthuse about electric cars or solar energy or wind energy. Moreover Transitional Engineering Professor Susan Krumdieck has rubbished the idea of hydrogen as a renewable energy.

Will rationing energy do the trick?

On the other hand I have enthused about David Fleming’s great invention Tradable Energy Quotas (TEQs) and advocated for them on twitter. That would prevent instability as GDP declined. And like many of us I have been on Zoom calls where experts talk about climate change and urge various actions, and they almost always finish with the reassurance that if we do a, b or c or all three we will turn it around. COP26 in Glasgow will do it.  Been there, done that.

Many alternatives to GDP have been proposed (OECD etc) but the GDP ‘mindset’ suits the ‘business as usual’ focus on economic expansion of goods and services, i.e. growth, over wellbeing. In fact New Zealand is cited as an example of a country which has wellbeing indicators, but there is no regular reporting of them in the media. In contrast business reporters regularly celebrate the growth of the economy.

Or protesting on climate?

By chance then I watched a talk by the delightful researcher Brenè Brown who had interviewed many courageous people. She asked them if the main thing they had to overcome was fear. No, they said, it was the armour you put round yourself to justify and explain your lack of action that stopped you acting. Fear was with you all the time.

So I reflected on the armour I put on. It goes like this: I say to myself, no I am not going to do this or that because I am a researcher/writer and that doesn’t fit with my self-image. So I decided to abandon the armour and get into protest mode. Having never been a big protestor except during the Springbok Tour and a joining a big climate change protest, at the time I was suddenly incensed that the All Blacks had signed a deal with INEOS, the oil company. I bought materials to make placards and made contact with others. A date was set. I practised my sign-writing.

Then lockdown came.

I was recently at a meeting where, after a conversation about the inaction of local and national government on climate, a person I respect said, “Don’t go down that rabbit hole I would never come out.” It set me thinking.

The Limits to Growth

In 1975 I was a candidate for the Values Party, three years after the landmark report The Limits to Growth which concluded that if global society kept pursuing economic growth it would experience  a decline in food production, industrial output and ultimately  population within this century. The Values Party had the nerve to question whether GDP was always progress. Twenty years later I was to learn the role of the money system in creating this growth imperative. Forty years later Wise Response, a group of environmental academics based in Dunedin, has been making submissions pointing out the limits to growth to government for years.

Then came Gaya Herrington’s article. She works at the accounting firm KPMG and holds a master’s degree in Sustainability Studies from Harvard University. Her July 2021 report appeared to show  that controversial 1972 study predicting the collapse of civilisation was – apparently – right on time. Both of the most closely aligned scenarios  with the data (“Business and Usual” and “Comprehensive Technology”) indicate that business as usual, pursuing continuous growth, “is not possible,” even when paired “with unprecedented technological development.” Such scenarios “would inevitably lead to declines in industrial capital, agricultural output, and welfare levels within this century.” In an article for the Club of Rome she says, ” The strongest conclusion that can be drawn from my research therefore, is that humanity is on a path to having limits to growth imposed on itself rather than consciously choosing its own.”

When I  watched an hour long talk by ecological economist William Rees called “Climate change isn’t the problem, so what is?” I was struck by the graph of steadily rising emissions  in the atmosphere with several landmark climate conferences placed in it. He said there were 34 international climate conferences held over 50 years and half a dozen major agreements.. “and they don’t produce a dimple on this rising curve of carbon dioxide emissions.” I couldn’t help wondering what makes us so optimistic and that the trend will suddenly stop. What on earth is this conclusion? Are we an intelligent species or not? That version of optimism is more like wishful thinking, which decides what works and tried to force that idea to work, even if it doesn’t.

The Paradox of Post Doom 

Recently I have been reading the book edited by Jem Bendell and Rupert Read Deep Adaptation: Navigating the Realities of Climate Chaos and then my YouTube threw up a talk by a fellow I had never heard of. At first I thought he was a fraud. He was talking about writers I had never heard of. Then as we went further into his extraordinary presentation, I paid more attention. He said the decline was already happening and eco-anxiety was normal and healthy. He is Rev Michael Dowd and has a website http://postdoom.com. In his podcast section he lists his interviews with people like Shaun Chamberlin, Jem Bendell, Rupert Read, Richard Heinberg, Gail Tverberg, Steve Keen, Joanna Macy, Matt Slater, Steve Bhaerman, Paul Ehrlich and many, many others, asking them the same set of questions about the future.

I have now listened to several of these interviews. Rupert Read, who often uses the sentence, “This civilisation is over” gave a very thoughtful interview. He related the story of how in 2018 he wrote a piece and sent it on email to several colleagues, asking them not to send it on. They replied saying it was worth publishing but he was too apprehensive so published it under a pseudonym. Once again a good response. He said he had a huge surge of energy to live a good life of service to others after he went through the door of gloom and grieving. Michael Dowd and he agreed on this. It’s a huge paradox. You don’t have to get stuck in a state of despair or cynicism, you don’t need to get paralysed. Once you stop fighting the denial, once you resist falling into the trap of compulsory optimism and hope, relief sets in and you emerge energised. The unnamed unease is gone. It’s a relief to face reality and the energy you spent in denial or false optimism is now available to use.

Similarly Jem Bendell was reluctant to put his thoughts out there in public for a start and got a fair bit of flak from his 2018 article Deep Adaptation.

So what is the alternative now? Face the coming decline of our civilisation and live a good life on this wonderful planet.

Politicians will chose economic growth not climate action

My observation is that the demand for economic growth will always trump meaningful action to halt the decline of the ecosystem on which we depend. It happens within Council’s departments and in Government departments and in Cabinet. It happens when global fossil fuel corporations, fixated on quarterly reports and profits, rationalise their way to ever greater extraction of oil and gas and coal. It happens because of our systems of government seem powerless to stop them.  It happens after every international climate conference.

Why? Many years ago I did some quick research on the interlocking directorships of the major companies in New Zealand – banks, utilities, energy, transport, alcohol companies and so on and I came reluctantly to the conclusion that these few men were more powerful in many ways than the government.

The societal demand for compulsory optimism

Insisting on optimism in the face of so much evidence is maladaptive.

Just because our species has messed with the planet’s climate doesn’t mean there isn’t joy in gazing at beauty.

I am not sure where this will all take me. All I know is that during lockdown I am standing in awe at the miracle of spring, of emerging life. Just because I have somewhat given up hope that all my work and the work of countless others over the last decade or two on climate change will come to anything it doesn’t mean I will stop working. There is life on the other side of contraction and collapse. There are plenty of victories that can be won. There is community to build, there is my garden to tend to, there are people to care for and who care for me. There are things in our culture to save.  All civilisations eventually die and homo colossus will not be spared. But what will rise from our mistakes? What lessons will be learned? How many groups will emerge and where? Will they be more humble, ecologically sustainable and equitable?

I am no more pessimistic today than I was last year. I smile as much. I cook just as many tasty meals. I laugh and sing still. It’s just that I believe it is time to face the fact that we are spoiling our home and it is probably irretrievable. Our civilisation is dying and the die-off will not be equal or fair. It’s time to grieve and emerge from the grief stronger and more loving.

As Ronald Wright observed in The Short History of Progress, civilisations like Easter Island and the Maya civilisation often fail because of some combination of overpopulation, environmental degradation, warfare, shifting trade routes and long drought. He argues that all successful cultures eventually fall victim to “progress traps” – technological adaptations which all allow excessive collection of resource wealth leading first to luxury, and then inevitable collapse. These cultures, before they collapsed, showed evidence of the development of social elites who contributed to the environmental abuses – another example of how our human species is so fragile. But whereas in all of these cases the collapse was local this time it involves the whole planet.

Now if you will excuse me there is new growth on my tamarillo tree to marvel at.

 

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