How America Spoiled Christmas – CNN


Although the pandemic has ignited the game, the United States has been building this bonfire of supply chain failures for years. The government drastically cut investment in the manufacturing sector, crippled the postal service and engaged in minor trade wars that made the pandemic era particularly painful for consumers.

Empty mail: The U.S. Postal Service is sort of a hot mess right now – strapped for funding and workers, and burdened by the influx of packages in the era of the pandemic.

It’s about to get worse. Since last Friday, mail to the United States has been more expensive and, in many cases, much slower, thanks to a controversial new service standard that cuts post office hours and charges consumers shipping rates of point. just in time for the holidays!
The dire financial situation of the USPS is largely the fault of Congress. Ironically, the USPS is cash flow positive. But the agency, which receives no funding from taxpayers, was crippled by Congress’ decision in 2006 that it must pre-fund 75 years of retirement benefits – an obscure system that no other government agency follows.

Manufacturing issues: Washington must also share the responsibility for the United States’ dependence on global supply chains.

For decades, the United States has innovated at home and built overseas, allowing high-end manufacturing (and the high-paying jobs that come with it) to disappear.

Take semiconductors, for example, those tiny chunks of etched silicon that power virtually every aspect of modern life, from your car to your refrigerator to the device you’re reading this on.

“The reason we’re really in this mess is because for a long time we haven’t invested,” Commerce Secretary Gina Raimondo recently told CNN. “We used to be the world’s leading semiconductor manufacturer and now we don’t do it anymore. We just divested.”

Over the past three decades, the United States’ share of global semiconductor manufacturing has fallen to just 12 percent, from 37 percent in 1990, according to the Semiconductor Industry Association.

Meanwhile, Asian competitors have increased their capacity, putting the United States at a “competitive disadvantage,” the trade group said. Although the Biden administration is pushing Congress to pass a $ 52 billion bill that would boost semiconductor production and research in the country, the impact of any legislation (which has yet to be passed in the House) would be years away.

Trade wars: To complicate matters further, the United States is locked in a trade war with China. Long before the pandemic, the Trump administration imposed tariffs on more than $ 300 billion in goods. Rather than pressuring China to reform its trade practices, the tariffs have hurt American consumers and manufacturers who depend on materials made in China (read: everyone). Treasury Secretary Janet Yellen has acknowledged this, but the Biden administration has yet to act.

Bottom line: Even if you don’t buy holiday gifts, the end of the year still looks like a chore as inflation remains stubbornly high.

Winter utility bills are another huge drain on household finances as inflation creeps into almost every consumer product on the market. Prices for natural gas – a non-renewable fossil fuel that remains America’s most common way to heat homes – are skyrocketing as the northern hemisphere slips into fall and winter.

This open fire on which you roast your chestnuts may need to serve as a home heating system.

US Employment Report

Consumer spending in the United States increased in August, according to data released last week, suggesting that summer fainting caused by the Delta variant of the coronavirus may be coming to an end.

But another big test comes on Friday, when the US government releases its jobs report for September.

Remember: The American recovery has reached a major roadblock in August, while the economy added only 235,000 jobs. It was the fewest new jobs since January, and the slowdown shocked economists who expected three-quarters of a million jobs.

This time around, analysts are hoping for a better performance. They will also be keeping a close eye on wage growth, which may affect inflation.

Low-wage workers are making “remarkable” gains in their paychecks, Goldman Sachs said last week.

The the bank said low-wage workers pay increased 5.3% in the second quarter compared to the previous year. Preliminary third-quarter data suggests wage increases are on track to peak at 6% in three decades.


On Monday: OPEC + meeting; PepsiCo revenues; Factory orders in the United States

Tuesday: United States Trade Balance Data

Wednesday: EIA report on crude oil inventories; Constellation Brands and Levi Strauss Results

Thusday: jobless claims in the United States; Conagra earnings

Friday: US Employment Report for September


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