Government Control Has Aggravated the Supply Chain

By Josiah Dalke
November 10, 2021

Last September, Toyota, one of the nation’s largest manufacturers of cars with respect to magnitude, announced that the company was going to take a three-week production break. This was due to the company’s slowdown in auto manufacturing across the globe. Workers were allowed to take unpaid leave, work at the plant at various jobs, or take paid time off. This was part of a larger issue that the company is facing as it is cutting global production by 40 percent due to a worldwide shortage of computer chips and vehicle supply parts.

Situations like this often arise when supply chains are not properly handled. California, for example, has become a very weak center for business in this respect. Meanwhile, states such as Texas and Florida have open ports and have invited shipping companies to bring their cargo.

What is the difference? One of the possible reasons is that California policies creates unnecessary barriers to efficiency. For example, California has adopted a law called AB5. This law recategorized truck drivers so that they could not operate as independent contractors working for several companies. In addition, environmental regulations have inhibited the expansion of storage facilities, leading to even more logistical challenges.

It is these kinds of environmental and labor policies that lead to deficiencies in the supply chain. While supplies in Toyota have rebounded and the company plans to make up for lost time, it goes to show how much of an impact a shortage of supplies can have on a given company.

Covid has certainly been a factor in these issues; however, the government cannot use Covid as an excuse for bad policy. On the federal level especially, government has taken prescriptive action for things that do not ultimately help the problem. Anti-contractor legislation, EPA truck emission regulations, and even Biden’s vaccine mandate have all contributed to the nation’s supply chain issues.

Mississippi should seek to counteract these policies as it builds an economy of free-market principles. While they seem justified, government regulations all too often stifle the growth necessary to have a self-sustaining economy. The state legislature should commit to examining the apparent deficiencies in the supply chain system and explore ways to alleviate the burden on private companies that aid the state economy. Giving up government control is the most effective way to manage supply chains.


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