Econ Prof: Dock Strike Could Cause Damage

A Tennessee Tech professor said the new strike against the shipping industry could cause serious damage to the US economy.

Professor Steven Isbell said the failure to negotiate a new contract between the union and the shipping industry has led to ports being shut down. Isbell said the closures will create temporary supply shortages and lead to higher prices.

“I read I think yesterday they were saying that for every day of the strike it takes five days to put things back together,” Isbell said. “So the longer this thing goes the ripple effects could be very, very large.”

Isbell said there will be no movement of products through key ports excluding select items like military goods. Isbell said this strike is the latest in a long series of incidents hurting the supply chain in recent years.

“The war in Ukraine has already upset some supply issues,” Isbell said. “The Red Sea, Suez Canal situation is, you know, something like two-thirds of the products are not going through that were before the Houthis started shooting ships. We got war in the Middle East. President Trump imposed tariffs when he was president and the Biden Administration has continued those things so that increases prices. And now we have a hurricane that shut down I-40, so that’s a huge supply disruption as well.”

Isbell said this strike could last for a long time because President Joe Biden said he will not invoke the Taft-Hartley Act. Isbell said the strike has the potential to become a point of contention in the upcoming election.

“Maybe this is the October surprise that the politicians were looking forward to for this coming election,” Isbell said. “Yeah, I don’t know. It’s pretty crazy out there right now.”

Isbell said organizations are already looking for unique ways to offset the damage caused by the strike.

“Everybody in the industry was already anticipating this could be a problem so they’ve already started increasing inventories,” Isbell said. “I understand that there’s some contracts moving into ports on the West Coast instead. That’s kind of limited though, if you think about it.”