Wednesday, March 25, 2020

Who Made This Crap? China, of course!

There's this great scene in the film "Armageddon" with Bruce Willis where the space shuttle they are using to get away from the death astroid is broken.

Something's wrong with one of its complex, sensitive parts and the engine won't start.

So the Russian cosmonaut, who always sounds drunk, starts wailing away at it with a wrench screaming "American components, Russian components, it's all the same and it's all made in Taiwan!" at which point sparks fly, the engine kicks over up and everyone goes home happy.

Except Bruce. But earth is saved, so fair deal (click here for clip).

Where's that Russian guy when we need him?

I was asking my son the other day "Who do I kill to make all this stop?" OK, I have some anger issues but I suspect even that drastic a measure, let along wailing at something with a wrench, is not going to
fix this mess.

Interesting article in the New York Times today (click here) about the really incredibly silly situation the US finds itself in: It can't buy enough 75 cent face masks.

The irony hit me while walking the dog. An F35 -- $130 million -- flew over.  We've bought a few hundred of those, and more are on the way, because someone decided we needed to stock up on F35s.

But the strategic reserve of face masks, which we are now realizing is a critical wartime medical supply, reasonably should hold a billion or so of them. It had 35 million before this started and now sewing groups in cities and towns are learning how to make them again because industry can't.

Last time we had sewing groups making bandage and face masks, "Over There" was a hit on the radio and Kaiser Bill was on his last legs in World War I.

I kinda thought we'd gotten beyond that, what with this being the richest nation on the planet, but here we are (click).

Oh sure, order more from China, which makes 100 million a day. But China sells to China first. Can you blame them?

As the article makes clear, part of the larger problem is not just that critical medical supplies of all sorts, not just face masks, are now made in China.

Bean counters in industry, wanting to maximize shareholder value, looked for cheap labor to cut costs. Plus, a lot of the medical stuff we use these days is one-time and disposable. You get better sterility that way, but that's also how a typical hospital can use thousands of the things in one day.

The really big picture is how so vastly much of America's lower-tech production is gone overseas.  Economists like to point out that we supply the intellectual capital and produce a lot of higher-tech stuff -- like F35s -- and leave the cheap low-tech stuff to the Chinese.

That's great until you need something low-tech and the Chinese don't want to sell it to you.  Like a face mask.

And DO NOT blame the Chinese for any of this.  American businessmen made these decisions, nobody else. Remember how Whirlpool closed a factory in Evansville, Indiana, in 2010?  The place was making money, just not enough money. So off to Mexico went the jobs. But hey, look at these cheap washers and dryers!

There is also the problem of "just in time" production.  Nobody likes to keep inventory any more because piles of unsold stuff aren't making you money.

I suppose you can wonder why hospitals don't keep their own stocks to handle emergencies but, remember, hospitals in this country, anyway, are run to make money.  Bean counters control them too, and you know how bean counters feel about large inventories.

Been shopping for toilet paper lately?  National TP production was set to match demand. This worked fine until a national emergency caused everyone to feel a need to stock up.  If everyone only took two packs instead of their normal one, there's a 100 percent increase in demand with no production capacity to match it. Manufacturers are reluctant to increase capacity because this spike will end and then they'll have excess capacity sitting there not making them money.

We're seeing the same thing with bread, flour, sugar, other basics.  Even aspirin is backordered. How the heck does aspirin become short supply?

If Mexico ever decides to quit selling us vegetables we're going to be in big trouble. Utah is growing homes where it used to grow veggies. The state's best prime farmland in Davis County now grows, mostly, lawn.

Will the powers that be learn the lesson here? I'm not holding my breath.  Obama's administration used 100 million of the face masks in the strategic reserve for the H1N1 crisis and didn't replace them.

Trump's administration ran a simulation of a pandemic last year that pointed up this, and a lot of other problems, but apparently Trump's much vaunted business administration skills don't extend to restoring the inventory of face masks.

One hopes the coronavirus thing will get manageable in the near future, folks will calm down and start digging into the TP stocks clogging their garage and life will sort itself out.

It could be worse. Was talking my friend Larry this morning.   He's 81 and remembers some of the shortages during WWII when, he said, "everything was short," although he doesn't recall TP being an issue.

Wartime rationing prevented a lot of shortages by preventing excess buying; if you had flour coupons, you bought flour. No coupon, no flour.

Then it was shoe leather, he said. "I had to put cardboard in my shoes when the soles wore out. I remember my mom would get mad at me if I went out when it was wet because the cardboard would melt."

I have heard no hint that the Chinese are going to stop selling us shoes any time soon.  Because, of course, who do you think makes them? 






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