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Wednesday, June 25, 2008

Newsflash: Shipping Cheap Crap Around the World Is Insane.

posted by on June 25 at 16:53 PM

The exurbs aren’t the only inanity in trouble thanks to the jump in energy prices…

As the cost of shipping continues to soar along with fuel prices, homegrown manufacturing jobs are making a comeback after decades of decline. While it once cost $3,000 to ship a container from a city like Shanghai to New York, it now costs $8,000, prompting some businesses to look closer to home for manufacturing needs…

The rise in transportation costs are fueling what some economists are calling “reverse globalization.” For instance, DESA, a company that makes heaters to keep football players warm, is moving all its production back to Kentucky after years of having them made in China.

“Cheap labor in China doesn’t help you when you gotta pay so much to bring the goods over,” says economist Jeff Rubin.

Some local manufacturers have suddenly found themselves in the thick of boom times.

(ABC news)

I also think Seattle Bubble might be wrong about the economics of moving from Marysville.

RSS icon Comments


Thanks for reminding me to gloat about this. Nothing beats gloating over SUVs, of course, but I also enjoy how right I was about commuting from the exurbs and shipping crap from far away.

I'm seeing a future with no giant Wal-Marts, and no junk to stock them with, and no vast parking lots in front, and no fat honking trucks to park there.

Posted by elenchos | June 25, 2008 5:08 PM

Shipping cheap crap around the world is insane but it does have that teensy weensy itty bitty benefit of having insane nations engage each other in activities other than war.

Posted by umvue | June 25, 2008 5:14 PM

I may be needing an air mask soon, but that sounds good to me. Give us more business stories like that, please.

Posted by smugsmog | June 25, 2008 5:21 PM


I've become a total neo-Malthusian. Famine, disease and war!


Right on! The only thing that gets more more upset than sustainable, local manufacturing is sustainable local manufacturing that pays decent wages to labor! Grrrrrr. I think we should subsidize shipping costs, no matter how much is drives up taxes! Nothing wiser or more efficient than shipping cotton from the Southeastern US to China, have it spun and sewn into socks and then shipped back to the US. Just making the socks in Ohio, right next to the cotton? NUTS.

Posted by Jonathan Golob | June 25, 2008 5:30 PM

Yeah so globalization takes different forms. But don't expect these to be good jobs without serious worker organizing.

Auret van Heerden, Director of the Fair Labor Association, told me that he expects most apparel manufacturing to move back to North America as the cost of shipping and the pressures for quick order turnovers increase. But when pressed, he admitted that he expected such growth in "free trade zones" and maquiladora areas like the US/ Mexico borders. Hardly the re-industrialization of the United States!

Posted by Trevor Griffey | June 25, 2008 5:33 PM

I've long said that when it's cheaper to buy an apple from China than one from Eastern Washington something is deeply messed up.

Posted by flamingbanjo | June 25, 2008 5:42 PM

I read somewhere that Holland and the US ship each other about the same quantity of butter cookies every year. The writer pointed out that it would be much cheaper just to trade recipes.

Posted by pox | June 25, 2008 5:55 PM

What inflation hides is the loss of comparative advantage. We can no longer afford to import cheap goods because we have to pay more for fuel. We have to pay more for fuel because the value of our goods and services has declined on the world market. For every job that we pick up at the low end in manufacture, we lose some at the higher end in terms of goods and services marketed abroad. The average standard of living starts to decline. We also experience a shift of wealth concentration towards those who have been able to position themselves politically behind protected sectors like big agriculture, defense, petroleum production and pharmaceuticals. This exacerbates the lot of the poorest two quintiles who find that a marginal increase in employability doesn't compensate for a very large increase in prices.

Posted by kinaidos | June 25, 2008 7:01 PM

I see your point about Seattle Bubble's point, and your point really counts when you are talking about Capital Hill. Even in Ballard though, which IS a pretty walkable neighborhood - technically - if I need to go to the grocery store and the bank, it will take me 3 minutes to drive there and 3 minutes to drive back. It will take me at least 20 minutes to walk each way. Plus, I can't walk home with a week's worth of groceries. So then I have to go each day, and that's 40 minutes to the store and back each day, when I could do one round trip weekly by car with a total travel time of 6 minutes. That's 280 minutes (or almost 5 hours) of travel time. Time IS money these days when the 60 hour work week is the norm, and if I have to take even 3.5 of those hours out of my work time, I've lost about $140. It's still cheaper for me to drive.

Posted by Bella | June 25, 2008 7:36 PM

The exurbs aren't the only inanity in trouble thanks to the jump in energy prices

the exurbs are not insane - shipping things is not insane - all the bad government policies that are not letting the oil supply keep up with demand are the insane things.

Posted by jmr | June 25, 2008 7:52 PM


We can't keep up with demand, and no amount of offshore or ANWR drilling is going to change that.

Oil is a finite resource. The higher the prices get, the more people cut back and the more incentive we have to find alternatives. Even if it were possible for supply to keep up with demand, all that would mean is that oil would run out faster with no alternatives in the works. And, trust me, you don't want to see the results of our running out of oil with nothing available to replace it.

Posted by keshmeshi | June 25, 2008 9:54 PM

@11, well we could. We are pretty much keeping up with demand now. There is plenty of oil in the ground. Hell we are only getting about 1/5 to a 1/3 of oil out of existing wells. A small increase in efficiency their could add years to our supply.

As for the whole moving to Shoreline, thing, that's not exactly close in. You can get a nice house for 400k in my neighborhood and I can walk to downtown in 30 minutes. Say you do that and cut out the car, you could make up the extra 100k pretty quickly. Hell not buying a new car would be a bout a third of that.

Even if you just stopped driving to work and kept a car for other shit, at about 58 cents a mile(IRS figure), 70 miles a day, 250 days a year yields 10150 a year. Interest and taxes on 100k is only a bout 7000. That's a savings of 3000 a year.

Posted by Giffy | June 25, 2008 11:07 PM


It's funny to me that the Republicans -- the people who are supposedly willing to kill as many American soldiers as they need to in order to make America safe and secure -- are the party that want to deplete our strategic oil reserves in order to reverse a temporary spike in the cost of oil due to free market speculation.

We need to abandon all the mollifying codewords, like "conservative" and "free market advocate," and just start calling you people what you are: fucking idiots.

Posted by Judah | June 25, 2008 11:10 PM

I keep thinking about this and I just have to put it out there. Am I crazy about this or is this on target?:

Despite environmental catastrophe, the world is going to burn every last drop of oil available. As oil gets more expensive, it will only lead to the burning of other less efficient fuels that pollute more.

In 100 years (maybe 50) the richest nation on earth will be the one with the last functioning oil field.

The only real possibility of an answer is new technologies, and the laws of physics are showing us that it's extremely difficult to find a fuel source even close to being as good as oil. Maybe we can gain efficiency and stretch the timeline, but it still ends in the same place: a hot Earth full of angry people and no more oil.

Posted by borb | June 26, 2008 7:25 AM

@14: It's not just the oil you should be worried about. How about clean water supplies? Those are vanishing even faster.

Posted by Greg | June 26, 2008 7:38 AM

@9: What you need to do is get a granny cart (tiny folding shopping cart). Carry it to the store, and push it back.

In NYC, where no one has cars, people find ways to make the often 15-20 minute walk to a reasonable grocery store and back home again. It's not impossible, it's just inconvenient.

Posted by Dawgson | June 26, 2008 8:48 AM


OR! Now this is just a CRAZY suggestion, but hear me out:

Get a bloody wagon/cart, you lazy twit. You CAN cart a weeks, hell a MONTH'S, worth of groceries from the grocery. Just invest the fifty-odd dollars it takes to buy the cart. The fourty minutes of walking once or twice a month will be healthy for you too.

Seriously? Time is money, yes. But when it comes down to it- what you were describing was not the a situation where you have to drive because it is cheaper than walking- what you were describing was being forced to drive because you are being willfully stupid when it comes to problem solving. Not to mention lazy.

I live in a city. My roommates and I live about 10-15 minutes from a grocery. He combine our orders, we take turns going, and WE USE A BLOODY CART. And guess what? Driving doesn't even enter the equation.

Posted by Johnny Liverwerst | June 26, 2008 8:58 AM

The problem with Seattle Bubble's argument is that it assumes the person moving from Marysville to Shoreline is going to buy a house of roughly the same size and quality, which -- using the post's example -- would cost roughly 33 percent more. Now, I'm not saying people aren't illogical from time to time, but I don't believe people are so unsavvy as to assume that the transportation savings of moving closer to the city will offset a 33 percent housing increase. When you move away from the city, you get a bigger place, hence the housing stock of McMansion developments and homes with acreage on the far-flung fringes of Seattle. When you move toward the city, you get a smaller place, hence the close-in stock of smaller houses on smaller lots and multi-unit buildings. That's the way urban geography has always worked.

Posted by Kalakalot | June 26, 2008 9:00 AM

apologies for all the typos. And 16 beat me to it, most likely because he was being more succinct and less ornery.

I just get very tired of just how lazy and purposefully ignorant many people in the US can be in terms of alternatives for driving everywhere.

Posted by Johnny Liverwerst | June 26, 2008 9:01 AM


But how many people in these McMansions truly need that much space to live comfortably? I come from a very wealthy, rural area. Yet even the more moderate families in our town managed to have houses that were, for the most part, far larger than necessary.

Yes, it is very true that moving closer to an urban hub requires you to pay more, but that is only if you want to live in something as large as you would in the suburbs. And honestly? I would equate it to all those countless soccer-mom's I've seen in my life: for a woman who will be driving around alone 85% of the time, a 7-seater car is simply overkill.

Unless you are a person who gets claustrophobic at the mention of an enclosed space that is less that 40 meters in diameter, I doubt downsizing to a smaller place is really such a bad thing.

Posted by Johnny Liverwerst | June 26, 2008 9:06 AM

@19: Wow... no one has ever called me less ornery before. Thanks!

I agree with you on number #20 -- what's the point of space that's unoccupied 90% of the time? Do you close off "wings" to reduce the heating costs?

Posted by Dawgson | June 26, 2008 12:07 PM

@20: You're preaching to the choir, dollface. I don't think anyone needs a 5,000-square-foot house in the exurbs. Then again, I've never understood the appeal of bland, isolated, car-dependant developments, which is why my sweetheart and I live in a tiny city apartment that's within walking distance of everything we need.

My point was that Seattle Bubble's central argument -- that the financial benefits of moving closer to the city don't really pencil out -- was faulty because it seemed to assume that a person moving from Marysville to Shoreline wouldn't downsize, but rather expect to make up increased housing costs with transportation savings. The example given was that a person selling their $300,000 home in Marysville and buying a $400,000 home in Shoreline would have significantly higher expenses each month even though their commute would be cheaper. Well, yeah, but ... who expects a shorter commute to counteract such a huge increase in housing costs? When people move to the city from the suburbs, they buy smaller homes because that's what they can afford.

I'm usually a big fan of Seattle Bubble's numbers-based arguments, but I thought this one was pretty disingenuous. People aren't stupid. Well, most aren't, at least.

On a related note, one of the things that drives me crazy about these "gas prices are really hurting people" stories is this underlying assumption that the 3-bed 2-bath house in the suburbs is the norm and that downsizing to a smaller (but closer) place is some strange and horrible fate. Square footage ain't everything. Seriously, how much space does a person really need? What's more important: Being able to walk to grocery store (and for some of us, stagger home from the bar) or having an extra bedroom that gets used a few times a year? Do you want to spend your time sitting in traffic or cooking dinner for your family?

Posted by Kalakalot | June 26, 2008 12:29 PM

I know it's totally possible to cart my groceries home. Guess what I did for the first 15 years after I moved out of my parents house?
#1 I was really trying to portray to you what the argument most people are going to give would be - that even living in a more walkable neighborhood is not convenient enough for most people.
#2 After all those years of carting my fucking groceries home on foot or on the bus all the time, I don't mind saying that I've earned the right to cart them home in my car once a month.
P.S. I'm not just shopping for myself, I'm shopping for my whole family. Perhaps I should not have procreated that one time, but I did, and my child is not quite to hauling age yet.
#3 If it really gets so bad that I can't even afford to drive to the store once a month, then yeah I'll buy a fucking cart and haul my fucking groceries home. In the meantime, since I stand all day for work each rather than sitting around on my ass judging others on the interwebs, I'll pass, thanks.

If all of the above makes me a lazy twit, oh well. The meek shall inherit the earth, right?

Posted by Bella | June 26, 2008 1:55 PM

@23: It's your choice to drive. I just thought it was disingenuous to suggest any other possibilities were impossible.

I spent 7 years carting groceries long distances so I feel like I've "earned" the right to be a little sanctimonious about this. I'm also moderately terrified of cars, which makes it a little easier of a decision to avoid them.

I wasn't judging. Just pointing out that you PREFER to drive, but it's not a necessity.

Posted by Dawgson | June 26, 2008 7:41 PM

I don't think I ever suggested other options were impossible. I just don't think that most people currently living in the suburbs are going to move into the city and totally give up their cars. And while driving shorter distances to places like the store and bank is better, I don't see that most people would think the trade off is worth it.
I should not have said that I CAN'T carry more than a day's worth of groceries home. Of course I could. But as I mentioned, I've done that enough and I don't want to anymore. For what it is worth, I probably drive less than any other person who owns a car, even though I actually like to drive. I do not, however, like how other people drive, so I do like to live in the city because I never need to drive far.
I could stop entirely, but I honestly do not feel that the time sacrifice would be worth it for me, and so I certainly don't think it would be worth it for suburbanites. Although, I suppose if they are currently driving 20 minutes to get to the store, what's the difference.
Either way, I certainly don't think that I deserve to be called a lazy twit for what I said.
As a final point, I really do think there are "city" people and "suburb" people. Some people can adapt to another way of living, but other people are just not going to be happy making that kind of big change.
Of course, we should all drive less.
Perhaps the suburbs should be re-developed to encourage density there? There is already development, so why not work with it?

Posted by Bella | June 27, 2008 2:21 AM

@25: I actually think the idea of developing the suburbs is a good one or at least a good one to explore.

I don't understand how excited people get on here for DENSITY. I can see the benefits for the environment but having lived in NYC for 7 years, I can also see how it reeks havoc on the infrastructure and sanity of everyone involved.

My parents live in an incredibly rural area and I don't think my dad would transition well to "high-density urban living" at all.

@17 called you a lazy twit -- I was just trying to point out there were good options for walking if you wanted to.

Posted by Dawgson | June 27, 2008 7:49 AM

Yes, I realized later that you were probably two different people. Thx for being a bit more reasonable!

Posted by Bella | June 27, 2008 1:28 PM

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