Suez Canal Jam Highlights Achille’s Heel of Globalization

From mask and glove shortages to using trash bags as gowns puts new focus on problems with the Just-in-Time Delivery system.

The Ever Given cargo vessel blocks the main shipping canal linking the Atlantic to the Pacific Ocean (New York Post)

In March 2020, while the number of cases were surging in the United States and globally there was a problem. Supplies of hand sanitizer, plastic gloves, personal protective equipment, gowns, and ventilators for hospitals were depleted. There were little to no stockpiles, and there were very few testing kits available which was putting a huge strain on doctors and nurses. As the country began entering a shutdown, reports of nurses having to use garbage bags as gowns and reusing protective equipment shows the consequences of a Just-in-Time delivery system.

The Just-in-Time system was a manufacturing model developed during the 1970s which sought to reduce inventory to maximize profit for business owners and shareholders. While this could theoretically help small businesses cut down on costs and allow more productivity, large companies largely took advantage of this system and went a step further. They relied almost entirely on the just in time system. Amazon for instance was a well oiled machine that took pride in cutting down inventory and maximizing profits for the richest man in the world, while timing bathroom breaks for it’s workers. In the first three months of the pandemic, it was a miscalculation that led to shortages in masks and gloves for hundreds of thousands of their employees.

Nowhere is there a better metaphor to highlight the downsides of this system than the cargo ship that recently blocked 25% of world trade for six days. Because companies and hospitals allowed their resources and stockpiles to be depleted, it lead to shortages around the world as cargo ships raced to provide much needed supplies. The consequences were so dire that health experts recommended to the public to reuse masks and not wear plastic gloves to the grocery store. Had hospitals and medical centers had more stockpiles of protective equipment, gloves, medical equipment on site rather than relying on a global supply chain (prone to disruption thousand miles away) it would have lessened economic turbulence that occurred last year.

According to the Sacramento Bee, the University of California Berkley drew attention to the issue of relying too much on the just in time business model. “The human cost of inadequate PPE during the current pandemic has been enormous in terms of illness and death due to COVID-19…the value of lost life could easily each reach the hundreds of millions of dollars in the next pandemic, making a PPE stockpile an urgent investment.” The researches recommended that states like California should have a 90 day stockpile to be prepared for another emergency, and given that climate change may have fueled the pandemic it makes all the sense of the world to plan ahead.

The New York Times in a recent article pointed out the problem with excessive globalization. The author points out that the just in time delivery system may have bode well for cutting inventory and increasing profits for corporations, but it was a huge risk during a once in a century pandemic. “An excessive reliance on just-in-time manufacturing helps explain how medical staff from Indiana to Italy found themselves attending to Covid-19 patients…without adequate protective gear like masks and gowns.” The unintended consequences left American hospitals without any stockpiles to use in case of an emergency. In essence an inferno was spreading in these hospitals and there were no fire extinguishers to contain it.

Photo by Andy Watkins on Unsplash

Although news has come out that the jam in the Suez canal has been freed, and some states now have some stockpiles in place, does not mean that the problem of relying on just-in-time goes away. With future pandemics that could be worse, hospitals and governments must get rid of relying on just-in-time manufacturing models and create emergency stockpiles of masks, gloves, and gowns so nurses and doctors don’t become overwhelmed. While this is rare pandemic that hasn’t occurred in the United States since 1918, it’s better to be prepared ahead of time than to relying on deliveries from another country thousands of miles away.

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