America ’s Truck Shortage Reveals the Folly of Pandemic Protectionism

Scott LincicomeShortages during the onset of the 2020 coronavirus pandemic caused many politicians and pundits toembrace protectionism as a  means of boosting the United States’ “resilience” to economic shocks and, by extension, Americans’ access to essential goods during the next crisis. Current shortages of pickup trucks, however, show why such plans are not only ineffective but could actually make thing worse.According to a  recent CNBCreport, the pandemic is causing Americans to travel across the country and pay record prices for new and used trucks (emphasis mine):Two factors tied to the coronavirus pandemic are driving the trend. First, when the virus surged across North America in March and April,automakers shut down plants from Canada to Mexico, severely restricting the supply of new models, including full ‐​size pickups.Then, as America emerged from the initial surge of the pandemic, many people who did not own a  vehicle in the past decided it was time to buy a car, truck or SUV so they could drive themselves and not have to rely on mass transportation or ride‐​sharing. The result:a  run on certain types of used vehicles, like full‐​size pickups.Tom Kontos, chief economist for KAR Global Analytics Research, who has tracked wholesale used vehicle prices for more than 20  years, calls this is the hottest market he’s ever seen.“In the space of two months, prices went from double‐​digit declines to double‐​digit gains, and have stay...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs