Category Archives: Trade

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As many as a hundred of these monsters, fully loaded, are queued up at anchor off the coast of Southern California waiting to offload. The backup is the worst in history and no end is in sight.

Remember the 1990s, when all the smart (i.e. rich) people in the room believed that Japan was eating our lunch and would soon bestride the world? (The movie Rising Sun, which came out in 1993, summed it all up.) The Japanese were buying American real estate, American companies and American debt with wild abandon, and our American oligarchs were swooning with admiration.

One of the techniques they most admired, and immediately began to emulate, was the concept of just-in-time manufacturing and inventory control. The Japanese had discovered that with the computational and communications speed of computers, you could arrange the delivery of raw materials to a factory, or manufactured goods to a retail store, to occur precisely when they were needed. This saved the costs of warehousing and sped up reimbursement. 

What industry touches, industry kills, and industry wrapped this concept in an octopus-like embrace. When industry scales something up, it increases profits and concentrates risks, but the profits almost always come first and the risks appear later. The benefits of just-in-time management to industry have been bountiful for 30 years. Now it’s later. Continue reading →

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Once marvels of modern engineering, highways are mostly over half a century old, and starting to fall down.

If we had some ham, the old saying goes, we could have some ham and eggs. If only we had some eggs. If we had the money, the new saying goes, we could fix our decaying infrastructure. If we had the materials. But we don’t.

Infrastructure is a cold, hard word. But it means the house in which the industrial world lives — the electric grid, the water and sewer lines, the roads and bridges, dams, airports, seaports, on and on. And our industrial world in America is on the verge of being homeless because the house is rotting down, the electric lines sparking dangerously, the water lines leaking, the roads and bridges rotting away. Continue reading →

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This is your captain speaking. Everything is proceeding normally, and we expect to arrive at our destination in about 30 seconds. Thank you for flying with us, and have a nice day.

The pilot of our great metaphorical economic airplane has just been on the PA system — again — to assure us that everything is going great. But it’s getting harder and harder to believe him. He says we’re making a slow and careful ascent to cruising altitude but it’s been hours since takeoff and we’re only 50 feet above ground. Is that normal? Should there be flames erupting from all the engines? With the turbulence, and the violent maneuvers to fly around tall buildings, concentrating on watching the movie and eating our peanuts is almost impossible. And we just heard the captain mutter, unaware that his mic was on, “What the hell does this button do?”

The state of the industrial economy, 2017. Continue reading →

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Wondering what happens when you don’t maintain the Interstate Highway system? Wondering if we can get along without it? Minneapolis, 2007. (Wikipedia Photo)

Watch closely any group involved in dealing with a disaster — let’s say, a fire company battling a structure fire — and you may catch the moment when they share a glance that says, “You know what, we’re not going to win this one.” Their conduct changes almost imperceptibly from “balls to the wall, we can do this,” to “watch where you step, and back away from the walls, she’s gonna burn to the ground.”

Such a moment may well have come this week for the people who still believe — or have believed since Donald Trump was elected president — that we are going to experience a Great Recovery of this country’s rotting roads and decrepit bridges, which will in turn create millions of jobs, restore the middle class, eliminate poverty, homelessness and cancer, save the economy and make it 1958 in America once more. And Mexico is going to pay for it. (Actually, candidate Trump promised $50 billion for the purpose, double Hillary Clinton’s proposed spending. But neither of them explained where they were going to get the money.) Continue reading →

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Containers crammed with electronics, clothing and other potential Christmas presents are stranded at sea by the bankruptcy of one of the world’s largest shipping lines. Theres more to come. (Phot by NASA)

It’s hard to describe globalization to a mayfly in a manner that will hold his interest. It takes a gifted storyteller to interest a creature with a 24-hour lifespan in anything that’s out of sight, or takes longer than a couple of hours to play out. In this he is much like the modern American, who has little appetite for any story that takes more than 140 characters to tell, about an event that takes more than a few hours to unfold. (As to why the American consumer of news acts and thinks more like a mayfly (Ephemeroptera) than a homo sapiens, well, that’s another question, for another time.)

But the fact is that homo sapiens ephemera simply cannot grasp the fact that a long, slow-burning fuse, however boring it is to watch, almost always leads to a terrible explosion. By that time, ephemera has forgotten the fuse and is always surprised. (“Wow, no one could have seen that coming,” he says.)

Continue reading →

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Mall gone.The malls of America rose with the big-spending middle class, and are declining as the big spenders disappear. (Photo by Brett Levin/Flickr)

After announcing the closing of 40 stores in January, Macy’s said last week it will shutter 100 more in the face of declining sales and profits at its brick-and-mortar stores. After the company announced the closings, along with a 95% reduction in profits, and chronically declining sales, and the layoffs of 4,000 people that will follow them, Macy’s stock immediately shot up 18%. (If that fact, all by itself, does not motivate you to get everything you own out of the stock market and at least 20 miles away from it immediately, then good luck, God bless, and we’ll hope to see you on the other side.) In May, Aeropostale announced the closing of 154 stores in North America, and slithered into bankruptcy. Meanwhile Sears, J.C. Penney, Radioshack and other stores closed by the hundreds under previously announced plans. Continue reading →

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A sand mafia — that’s what they call them — in Sierra Leone in the process of stealing a beach. With just a little more finesse, they do it in Miami, too.

The human industrial complex requires enormous inputs of natural resources to build and extend itself. If you rank these raw materials by volume used, number one will be water. Number two will be sand.

Hard to accept? Go anywhere in the world and look around. If you’re in a city looking at a high-rise building, it’s probably mostly concrete (sand), just like the streets, sidewalks, bridges, and the freeways with their interchanges and ramps. The windows in the skyscrapers and storefronts are glass (sand). Some buildings are made of brick (sand) or block (sand). And some of the highways are asphalt (sand). Out in the country most houses may be framed with wood, but they rest on foundations and basements of  concrete and block, and many of them are roofed with asphalt shingles. I’m finding this out, and telling you about it, using computer chips made of sand. Continue reading →

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The train to nowhere. (Image from Google Earth)

It’s a picture that’s worth a thousand choruses of “Don’t Worry, Be Happy.” Here in the Seventh Straight Successful Year of the Recovery from the Great Recession, tucked into a corner of the Arizona Desert, is a line of parked Union Pacific locomotives. It was discovered on Google Earth, so it is, as they say, visible from space. There are 292 of them, baking in the sun like so many dinosaur skeletons, in a line stretching almost five miles. They, and the people who used to run them, are now “excess capacity” for one of the country’s largest freight haulers. In this, the Seventh Straight Successful Year of the Great Recovery. Continue reading →

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This is where more and more of the world’s cargo fleet are headed — the scrapyard, like this one in Bangladesh. (Photo by Christoph Hein)

On Friday, for the first time in recorded history (according to MarineTraffic.com), there may not have been a single cargo ship in transit across the North Atlantic between Europe and North America. If true, this would have roughly the same implications for the industrial world as does a flatline on a heart monitor, for a patient in ICU. Somebody had better call a Code Blue.

Since Friday, the stock market — after the worst beginning of a year since the last Ice Age — has been creeping upward. Guess they didn’t get the memo about the Code Blue. Continue reading →