Columns
Blaine’s Bulletin – Show-Me the Supply Chain, Securing Missouri's Supply Chain Future
Washington,
June 28, 2024
I bet you don’t consider where your favorite companies or brands source their products from. Many of our favorite companies—Tech, Fashion, Auto, you name it — get their supplies from and manufacture in Communist China. The finger is constantly pointed to lower labor costs or lax business regulations. And while it’s easy to think this may not impact us immediately, a Chinese invasion of Taiwan, would immediately highlight the fragility of our global supply chains and the devastating economic consequences of over-reliance on foreign sources. Consider this, Communist China is the United States’ third-largest trading partner and we're their largest trading partner; on the surface that may seem like an eye for an eye per se, but I promise you it’s not. This relationship has led to a high level of economic integration, but it has also made us incredibly vulnerable. In 2022, the total value of U.S.-China trade reached an all-time high, illustrating just how dependent we have become on our biggest enemy on the world stage. As you can imagine, technology has become one of the highest friction areas, U.S. businesses have an urgent need to diversify their supply chains to mitigate risks from over-reliance on any single - country not just China. As part of the broader trend of nearshoring manufacturing to improve stability and reduce exposure to geopolitical risks, many brands have started the move out of China. But started is a loose term, companies claim it will take them anywhere from 5 – 15 years to move out of China. And a move is not even a complete solution. Chinese companies are investing in operations in smaller countries, meaning products made in places like Thailand will STILL be under Chinese control. This strategy allows China to tighten their grip over global supply chains even as companies move production elsewhere. I wish I could say it was as simple as relocating factories, and production to reduce supply chain dependency on China, but even then, the CCP would still be looming over American made companies. Take Nike for example, they have significantly reduced their production in China, increasing it in Vietnam, same with Apple. Despite efforts to move production to India and Vietnam, they both still rely heavily on China’s manufacturing capacity. So, what’s next? I’m not going to suggest you get rid of your iPhone, laptop or tablet but something far more impactful. To secure our economic future, we must build resilient supply chains – American made supply chains. To do so, we need to bring our supply chains back to the U.S. Not only would that put jobs on main street Missouri, feed the mouths of millions of U.S. families and safeguard our economy; but we can take away the reliance on our enemy. This involves diversifying our sources of imports and reducing our reliance on any single country, especially China. Failing to do so promises a stark reality being that were risking $400 billion of revenue in China. If that doesn’t underscore the urgent need for change, I’m not sure what will. Here in Missouri’s 3rd District, businesses and entrepreneurs have the opportunity to lead by example, by investing in local manufacturing and supply chain diversification. By supporting initiatives that prioritize American-made products and supply chain resilience, we can contribute to a stronger, more secure economy. I cannot urge you enough to support local businesses and products, and advocate for policies that reduce our dependency on a country that doesn’t want to see us succeed. |