New U.S. Tariffs Are Contributing to the Shipping Crisis, and There ’s Little We Can Do About It

Scott Lincicome and Alfredo Carrillo ObregonAccording tonumerousreports, skyrocketing global shipping prices and related transportation bottlenecks arehindering the U.S. economic recovery. Indeed, this “shipping crisis” is one of the summer’s most‐​covered financial phenomena. Yet barely mentioned outside of a few industry publications is howbrand new U.S. tariffs of more than 200 percent(!) are contributing to the problem. And U.S. trade law all but ensures that there ’s little we – even the White House itself – can do about it.American ports and rail terminals are struggling to cope with unprecedented surges of imports from Asia, a situation likely to continue into next year and contributing to both American companies ’ supply chain woes and broader inflationary pressures. Shipping containers arepilingup by the thousands, leading to port delays, higher shipping costs (both ocean and inland freight), and U.S. exporters – mainly ofagricultural products– lacking the empty containers they need to send their goods abroad. Importers, meanwhile, are especially reeling. Firms like theColumbia Sportswear Company,Whirlpool, andPeloton have gone on the record about rising shipping costs and struggles to meet consumer demand. Small businesses arebeing hit particularly hard, facing the decision to pay three times the typical shipping rate for products that are unlikely to arrive in months. And peak shipping seasonhas just begun. The disruption is such tha...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs