Perhaps it is time to re-think the problem of inflation and the role world shipping plays in it
 Now that inflation has been recognised as a feature of economic life, rather than the transitory footnote it was thought to be at the US Federal Reserve, one can deal with it as the reigning reality of our time with a view towards mitigating its effects.
Its cause can be rooted in the Covid scare. Not to the disease itself, which killed the very old and the very sick - those expected to die anyway. It was not the disease, but our reaction to it that did the damage. There still appears to be no discernible difference in outcome between those jurisdictions that took extreme measures to fight Covid and those that did not.
Of course, there must be someone to blame lest the political class that drove these measures would be blamed. So international shipping, run by foreigners who cannot vote, with their inconvenient flags of convenience, while enjoying sky-high freight rates, are easily scapegoated as a gang of evil capitalists that bureaucrats love to hate.
Our response to Covid and its aftermath was - and continues to be - to make vast expenditures on things that do not matter, prescribing more of the same bureaucratic activism that got us into the fix we now find ourselves.
This takes the form of spending of money fresh off off the press, something called "quantitative easing", which, to be fair, can used as a pump-primer if done judiciously.
Anyone who has heard of the runaway inflation created by Germany's Weimar Republic in the 1920s knows what happens when one simply prints money and spends without restraint. It works for a while, but only for a time. Before you know it, too much money is chasing too few goods - and shoppers carry wheelbarrows of money to buy the evening meal. Everyone knows this, certainly the Fed does, as does the Bank of England, the European Central Bank and the People's Bank of China.
In US President Joe Biden's defence, proponents of quantitative easing - printing money - will say that all president have shamelessly raised the debt ceiling. Of course, the difference is that President Donald Trump accompanied his spending with a tax cut.
While it appears to be counterintuitive, a tax cut brought in more tax revenue. A tax cut signals the government is not against the taxpayer, no longer treating him as a milch cow to be exploited to enrich the tax spending classes from the bureaucrat, NGO to the welfare mum.
As in every other economic sector, inflation hit supply chains too. It was caused by the panicky reaction to the disease that produce more hysteria than casualties. In keeping with the Democratic Party dictum - "never let a crisis go to waste" - the policy was not to calm the people, but to panic them. Fearing bureaucrats would shut ports down, shippers shipped as much when they could before the dreaded shutdown, clogging supply chains, at seaports, railyards and truck depots worldwide. Add to that the entirely unexpected phenomenon - an ecommerce explosion. If people could not go out and play, they stayed home and bought things. This otherwise welcome trend, made supply chain clogging worse.
Compared to where the global economy stood two years ago, the biggest outcome was inflation. It now costs more to acquire raw materials, manufacture goods, and ship these goods to where they are wanted. Disruptions have also created a misallocation of shipping containers, pushing up freight rates.
Corporate insolvency has also been on the rise. Firms, in general, are having a much more difficult time paying debts in full and on time. If inflation continues to increase, the widespread existence of firm-specific insolvency can be expected. Any firm that relies on global supply chains - that's most of them - will need to consider various possibilities likely to emerge.
Some supply chain relief might be found in ending the Russian-Ukrainian war as it would re-open the world's important trade routes and expand access to some of the world's most-needed resources, such as petroleum, gas, wheat, rare-earth minerals, and more.
But insisting that Russia be punished as Democratic Party partisans do, means defeating Russia in a war they appear to be winning. Ending the conflict without escalating the war instead suggests compromise - and perhaps giving Russia, the Russian-speaking eastern regions, long subjected to linguistic cleansing by Ukrainians similar to those measures deployed in Canada's western Quebec province, where the French-speaking province-wide majority seeks to reduce if not eliminate the influence of the English speaking provincial minority that forms a local majority in the western region.
Unless one wishes to expand the Ukrainian war, such a compromise, at the expense of the Ukraine and the West, ought to be considered. That may well come as the situation on the battlefield dictates. While Russia and Ukraine, collectively, only account for about two per cent of the global economy, their resource-rich terrain endows it with geographical significance it would not otherwise have.
There are other geopolitical flash points, China and Taiwan, which also have potential to escalate into global conflagration. All of which the global shipping industry should be keenly aware.
The election of Donald Trump, the triumph of Brexit, the growth of the right in the rest of Europe, is a signal that the rule of the anointed bureaucracy otherwise known as the best and the brightest has been challenged and will be challenged again and again until it is toppled. This has come about because their policies have been proven failures for most working people and they make no creditable policy proposals going forward.
This has resulted in the election of every Democrat's 17th choice as president and a vice president of the United States. Neither was elected on the basis of anyone caring a jot about them. Similar leaders, who no one really cared for, Macron in France and Trudeau in Canada, were mere atavars for their political constituencies, also known as the Deep State.
Democrats propose but they do not dispose except in terms of their postmodern Marxist ideology and with their overblown fears of global warming, in which few if any can say in specific terms what they are so frightened of. But they plow on regardless, only allowing oil drilling in lands that have no oil, so they can say industry is not drilling at sites where they are allowed to drill while forbidding them to drill in places where oil can be found. This thinly masks a plan to arrest the development of fossil fuels to make them more expensive than renewables through the application of regulatory restrictions and outright bans.
First let us forget about Covid. The death rate in most of the prosperous world will continue to rise for the next 10 years with or without Covid. If 50 cents of every dollar in 1965 was spent by someone under 25, then it stands to reason that a disproportionate number of deaths will occur in this cohort of war babies and baby boomers from now till 2032. They have had their three score and ten in the sun. It is simply time for them to go.
Once Covid is dropped as major public concern - which it never should have been - supply chains disruption should disappear as the shipping world returns to its traditional back-to-school and Christmas peak seasons and slack seasons in between.
Just as the shipping world has changed from 1965 when (400 TEU equivalent) Liberty ships with 40-man crews ruled the waves, since replaced by 10,000-TEU cellular containerships with 20-man crews, we can beat back inflation by exploiting these advances.
Even the Covid scare has produced serendiptous discoveries, namely working from home. Since office workers prepare, transmit and receive verbal and written information, there is no need for them to muster in one place - not every day and not all the time. There are psychological and sociological problems in making it work, but with a will these problems are soluble. The main objections will be the violation of bureaucratic rules and the main opposition will come from bureaucrats.
The pluses for the supply chain are enormous. Much of the needless office space could be converted to housing resulting in urban compression, freeing the roads of needless traffic making it easier for deliveries to be made.
Much can be done to beat inflation, but bureaucracy gets in the way. That is doubly true if we demand that the bureaucracy solve the problem. That is the issue.
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