Following the Biden administration’s release of the White House Council on Supply Chain Resilience last week, which is comprised of nearly 30 actions focused on strengthening U.S. supply chains, there has been a fair amount of follow-up and some analysis from industry stakeholders on the effort’s potential merits and benefits, at a time when the supply chain continues to receive far more attention post-pandemic than pre-pandemic, to be sure.
As previously reported, the White House said that this effort is focused on boosting supply chains considered critical to the country’s economic and national security while also boosting the economy on various fronts—including: enabling reliable deliveries for businesses; strengthen U.S. agriculture and food systems; and also support good-paying union jobs—and also “support the enduring reliance of America’s critical supply chains.”
The White House Council on Supply Chain Resilience’s action items are wide-ranging, addressing various issues domestically and internationally, including:
Dick Armstrong, Chairman of Brookfield, Wisc. -based supply chain consultancy Armstrong & Associates, called a council a massive program that touches all of the bases.
“Of particular interest to me are the Multimodal Freight Office and the Supply Chain Data & Analytics Summit in 2024,” he said. “At the same time, we need to remember that the transportation industries in the U.S. have significant organizations collecting data and providing useful information. Hopefully, the governmental efforts assist rather than impede. Our current trucking, railroad, airfreight and warehousing are efficient and cost- competitive.”
According to Simon Geale, executive vice president of procurement for Proxima, a Chicago-based strategic team of procurement specialists, the establishment of this council serves as an indication that the U.S. is doubling down on efforts to future-proof key domestic supply chains and ensure that the nation plays a leading role in the battlegrounds of tomorrow, adding it should neither come as a surprise nor be seen as isolated positioning in what is becoming a rapid regionalization of global trade patterns and skills.
“Near term resilience is one thing, but what we are seeing is areas such as the US, China, EU and India place their bets as to where to invest as nationals and what trade partnerships will protect national interests and create economic value,” observed Geale. “U.S. policy over the last year gives insight into where the U.S. sees high risk and high value: health & pharma, technology, and defense. The reality of global supply chains is that onshoring to the point of self-sufficiency is not possible, hence a complex web of stimulating investments and strategic supply chain partnerships. This recalibration has started and will play out across the globe over the next few years.”
While the White House Council on Supply Chain Resilience is replete with good intentions, Thomas Cullen, chief analyst for London-based Transport Intelligence, observed in a research note that a number of the announced measures “appear to be essentially bureaucratic” with others ostensibly viewed as an attempt to influence parts of the U.S. economy, including logistics.
“For example, Joe Biden has said he will create the ‘Department of Transport Multimodal Freight Office,’” he noted. “It might be assumed…that the U.S. Government could use such an initiative as a platform for investment in intermodal transport, such as the port and rail infrastructure between the West Coast and Chicago. There is money being spent as part of this wider supply chain initiative, with US$196m being spent on what is called the ‘domestic food supply chains,’ however it is unclear if any of it will be spent on logistics infrastructure. A great deal of this statement seems to be about making political gestures rather than operational realities in supply chain management. Certainly, the politicians say that they are concerned to avoid the sort of problems that were seen around the port of Los Angeles in 2021 and 2022. However, judging by this statement there are higher priorities than dealing with port infrastructure.”
The next steps taken by this newly-established initiative will require a close, and likely patient, eye and perspective. As we all know well by now, the supply chain is in the forefront on myriad things related to the country’s well-being, including: the economy, climate change and sustainability, sourcing, and trade, among others. The White House Council on Supply Chain Resilience addresses these factors on balance, but the real work truly starts now.