Summary: America’s supply chains are fragile and could face major disruptions due to geopolitical tensions. The COVID-19 pandemic exposed the weaknesses in these networks, leading to significant shortages and economic concerns. Policymakers are now focusing on how to strengthen supply chains to prevent future crises.
Rising geopolitical tensions across the Pacific threaten to test the fabric of world commerce more severely than anything we have seen yet. (View Highlight)
Lower-margin businesses were eventually priced out of shipping entirely—which was necessary to relieve the strain, but exacerbated shortages. (View Highlight)
The price mechanism coordinating the activities of a system without central management is one of the greatest achievements of human civilization. But systems often do not run successfully if left to be managed only by the invisible hand of the market. (View Highlight)
no authority is in charge of the overall workings of the global supply network, (View Highlight)
Interventions—by governments and industry groups—can make supply networks much more robust than they would be otherwise, in a market left alone to coordinate itself. (View Highlight)