This Week in Logistics (July 27 – August 2)

It is great when a plan comes together. In Boston, we are looking at another blistering hot weekend. My wife suggested we get away for to the cooler mountains of northern New England. In a few hours we had rearranged our Monday calendars. My wife then convinced my son to house sit and walk the dog – who is getting too old for long mountain hikes – and booked a motel in the White Mountains of New Hampshire. One nice thing about New England, in a few hours you can drive to great cities, beaches, or the mountains.

Now for this week in logistics, which was dominated by trade.

week in logistics

Trade talks with China will resume in September. The White House announced the fresh round of talks on Wednesday after negotiating teams for both sides had concluded a renewed set of discussions aimed at ending a tariff war over trade and technology on Wednesday. Meanwhile, the Wall Street Journal reported that China is thinking that it can receive a better offer from the US by not hurrying into concessions. Not long after the Journal article, it was announced that the United States would impose a 10 percent tariff on an additional $300 billion worth of Chinese imports starting September 1st. The new tariff would come on top of the 25 percent levy that Mr. Trump has already imposed on $250 billion worth of Chinese imports. Mr. Trump had agreed in June not to impose more tariffs after meeting with the Chinese president, Xi Jinping, and agreeing to restart trade talks. But Mr. Trump said he was moving ahead with the levies to punish China for its failure to live up to its commitments, including buying more American agricultural products and stemming the flow of fentanyl into the United States.

Billionaire indicted for evading duties. The Justice Department said 55-year-old Chinese billionaire Liu Zhongtian, former president of aluminum producer China Zhongwang Holdings Ltd., was indicted by federal court in Los Angeles for evading $1.8 billion in US import duties on shipments destined to the U.S. The aluminum shipments were labeled as “pallets” to avoid customs duties of up to 400%.

week in logistics

Candidates talked trade at the first round of democrat presidential debates on Tuesday, candidates weighed in on issues including the U.S.-Mexico-Canada Agreement, the Trans-Pacific Partnership (TPP), and ongoing metal tariffs. Asked by the moderator whether he would continue Trump’s steel tariffs, Rep. Tim Ryan of Ohio said he would “have to reevaluate.” Ryan said some tariffs are effective, but Trump has “bungled the whole thing.” He questioned whether the administration has a developed strategy for the trade measures. Former Rep. John Delaney of Maryland agreed the US should not go it alone. He voiced support for TPP, noting that the U.S. would be in an “entirely different position with China” if it entered the pact. “We can’t isolate ourselves from the world; we can’t isolate ourselves from Asia.”

Massachusetts Senator Warren took a shot against the renegotiated NAFTA, arguing that its “central feature” is to “help pharmaceutical companies get longer periods of exclusivity so they can charge Canadians, Americans and Mexicans more money and make more profits.”

Beto O’Rourke, the former Texas representative, said tariffs were a “huge mistake,” and constituted the largest tax increase on U.S. consumers, hitting the middle class and “working poor” especially hard. He added, “When have we ever gone to war, including a trade war, without allies, friends and partners?” and argued Trump had antagonized our European allies.

The topic was picked up again the next night, when ten more candidates debated. Sen. Kamala Harris of California contended that President Trump’s trade policy forced the Federal Reserve to cut interest rates. The logic is that trade uncertainty had slowed global economies and forced the Fed to stimulate the economy. Further, “the so-called trade policy” … has resulted in American families spending as much as $1.4 billion more a month on everything from shampoo to washing machines.”

On the Trans-Pacific Partnership, former Vice-president Biden said “I would not rejoin the TPP as it was initially put forward… because it does not sufficiently hold China accountable for their trade practices. Representative Tulsi Gabbard of Hawaii disagreed with Biden. She said she would not continue Trump’s tariffs on China. “I would not because the approach that President Trump has taken has been extremely volatile without any clear strategic plan and it has a ravaging and devastating effect on our domestic manufacturers, on our farmers who are already struggling and are failing to see the light of day because of the plan that Trump has taken,” she said.

Let’s move from politics to something more uplifting. Like getting away!


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