Supply-Chain Woes Explained

On today’s episode, Sarah and Steve sit down with Scott Lincicome, senior fellow at the ...

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On today’s episode, Sarah and Steve sit down with Scott Lincicome, senior fellow at the Cato Institute and author of The Dispatch newsletter Capitolism, to discuss the details of our global supply-chain issues. Plus, Lincicome answers questions about inflation, wages, and problems with our labor force participation. 

Show Notes:

–Make sure you get Capitolism in your inbox

–Lincicome’s latest Capitolism tackles our supply-chain woes

–Lincicome’s Capitolism looking at our labor shortage

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Comments (28)
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  1. Avatar photo
    Nathan

    Sarah's defense of Harris was the best part of the episode, partially for the "oh my gosh" and other exclamations from the others. Sarah, thank you so much for being the (almost literally in this case) devil's advocate! It makes things very lively and I learn more.

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  2. Will

    I just have one question. Would it be any different had Trump won (like for real)?
    It seems to me that a lot of what Biden has done, Trump would have as well.

    So a thought experiment, what would be the difference?

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    AC Kansas

    Steve may not be able to yet but a 'new' used car, but I hope he has already purchased a Packers stock today!

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    Ethan Cordray

    In my podcast app (Podcast Addict on Android), there's an ad at 16:25 (which is 16:19 on the file on this page; after Scott says, "There just not a lot they can do" and before Sarah says "I wanto to move to inflation a little bit.") It's a fifteen-second spot for for some TV show called "Thousand-Pound Sisters" on TLC. It's super annoying.

    The ad doesn't appear on the streaming file here on The Dispatch.

    What's the deal here? Is this ad inserted for only podcast app listeners? Is it deliberately tagged as an ad insert-spot of some sort? Because it seems like that's an deliberate edit break in the episode.

    I would probably mind less if it weren't an ad for some disgusting TLC reality show that I have zero interest in. But it stuck out to me like a sore thumb. Not the quality of content that I expect from The Dispatch.

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    Ben Connelly

    Boy if Starbucks went to $50 an hour I’d give up this self-employment thing and get a job at Starbucks tomorrow!

    Great podcast. Always like to hear from Scott. I hope it’s early 2023 that car prices plummet.

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  7. Jon

    Political pundits in general need to take lessons in economics before opining on them. Here’s the best and fastest way to educate oneself.

    https://podcasts.apple.com/us/podcast/the-peter-schiff-show-podcast/id404963432?i=1000541709552

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    Steve Gordon

    Excellent discussion. I'd like to add some color commentary on the trucking situation. Our family operated a truckload carrier for 70 years that grew to 2,000 trucks, so have some experience there.

    There's three big changes to safety regs that have hurt driver supply and flexibility in the last decade. The first was the work hours change Scott mentioned on the pod during the Obama admin, that put drivers on a "continuous" work clock. Once they start working, the clock starts and they can drive up to 11 hours and work 14. That sounds like a lot, but really isn't because those hours include waiting at the dock, between loads, fueling, eating, etc. This made the industry safer, but took all flexibility away from a driver and made it a worse job.

    A couple years ago an electronic hours monitoring system was mandated across the industry to ensure drivers were complying with those hours. Most large fleets already had them in place and wanted everyone else to have them as well so there wasn't an advantage given to companies without those controls and broke the rules. Again, this definitely improved safety as well, but given the independent nature of drivers, this drove more out of the profession and took away any flexibility.

    This year, a federal drug and alcohol clearinghouse was implemented. The industry has a good history of eliminating drug and alcohol use in these safety sensitive positions. However, in the most inane system ever, when doing the mandated background check to see if a driver had been previously fired for drug or alcohol use, the previous employer didn't always comply to give you an answer, as well as extremely high turnover in small trucking companies. It was entirely self regulated. Now, results have to be reported to a clearinghouse and you check the records against that. Again, very good for safety, and rightfully took some drivers off the road who shouldn't have been driving due to past drug use/testing failures.

    These three things have really squeezed driver capacity, mostly for good ends with improved safety. But given the notoriously inefficient operations at the ports, larger companies with lots of customer options avoid them like the plague. Probably only about 10% of truckers will subject themselves to the quasi-abusive treatment there, so we're talking about a small industry subset of an already constrained driver pool.

    Anyway, hope this is informative for any supply chain geeks like myself.

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    1. Dave Morrison

      Thanks for the insights, Steve. I've been monitoring the incredible build-up of ships waiting to get into the twin ports of L.A. and Long Beach. My late brother was a career truck driver, and I hear from a lot of drivers on my YouTube channel, 'Blue Collar Logic'. Maybe we should chat. I think that the trucking industry is poorly understood by a country that gets all of its sustenance by truck. -Dave Morrison dmorrisonmusic@gmail.com

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      Ben Connelly

      Thanks for sharing! It was informative!

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    Adicesa14

    Enjoyable and informative conversation, thank you. Unfortunately, if your prognostication is accurate, I won’t be buying a new or used car anytime soon.

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    Victor Clairmont

    Thank you Mr Lincicome!

    Always great to hear you and read your writing when I can even if I disagree (which is rare).

    And thanks for helping to show what is the Biden’s current economic problems, and which things are more holdover problems that have been brewing for awhile throughout the years (which was reiterated in your writing about port problems and unionization).

    I must say though, not having people in the workforce service industry has led to what most of us figured:

    The machines running the day and taking jobs since not many are going back to them.

    Prepare for Skynet!

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