Sunday, August 03, 2008,7:30 AM
A Wonderful Opportunity
As you all know, I think the efforts of Southwest Virginia politicians - efforts that, in some cases, have been ongoing for decades - to bring northern tourists to the area to take in our scenic landscape (like they don't have rocks and trees in the Catskills) through the (costly) construction of a bewildering network of hiking trails and bike paths that now crisscross the region, the intention of which is to bring (a handful of low-wage, no benefit, seasonal, part-time) jobs to this tortured land, is a complete waste of time and taxpayer money.

If only they'd start thinking through the implications that one can infer from the following, and start acting on it:

Shipping Costs Start to Crimp Globalization
By Larry Rohter, The New York Times

When Tesla Motors, a pioneer in electric-powered cars, set out to make a luxury roadster for the American market, it had the global supply chain in mind. Tesla planned to manufacture 1,000-pound battery packs in Thailand, ship them to Britain for installation, then bring the mostly assembled cars back to the United States.

But when it began production this spring, the company decided to make the batteries and assemble the cars near its home base in California, cutting more than 5,000 miles from the shipping bill for each vehicle.

“It was kind of a no-brain decision for us,” said Darryl Siry, the company’s senior vice president of global sales, marketing and service. “A major reason was to avoid the transportation costs, which are terrible.”

Cheap oil, the lubricant of quick, inexpensive transportation links across the world, may not return anytime soon, upsetting the logic of diffuse global supply chains that treat geography as a footnote in the pursuit of lower wages. (link)
So how does this affect us here in Southwest Virginia?
Globe-spanning supply chains — Brazilian iron ore turned into Chinese steel used to make washing machines shipped to Long Beach, Calif., and then trucked to appliance stores in Chicago — make less sense today than they did a few years ago.

“If we think about the Wal-Mart model, it is incredibly fuel-intensive at every stage, and at every one of those stages we are now seeing an inflation of the costs for boats, trucks, cars,” said Naomi Klein, the author of “The Shock Doctrine: The Rise of Disaster Capitalism.”
So where does Wal-Mart get its furniture? China.

And where does China get a good bit of its raw materials that are used to make the furniture that Wal-Mart sells here in Southwest Virginia?

Southwest Virginia.

How expensive has it gotten for a company to haul timber out of Wise County, rail it to the port in Richmond, put it on a boat to China (or Italy or Spain or the U.K. or ...), build from it desks, beds, cabinets, etc., and then send the finished product back to the USA? According to the New York Times article, transportation costs (relating specifically to shipping containers) has gone up an astronomical 166% in recent years. ($8,000 on a 40-foot container compared to $3,000 "early in the decade"; times two for the container bringing the finished goods back).

I have an idea. How 'bout we build furniture plants here in Southwest Virginia to defray the cost? Say, in Galax? Where all that timber stands not far away in abundance?

Is that a great idea or what?

And how 'bout we ask our elected representatives in Washington and in Richmond to shift their focus from those many trails to nowhere they've carved out of our valuable forestland and start creating conditions that will reduce the tax and regulation burden on new and existing manufacturing enterprises here in Southwest Virginia and do what they can to help fledgling businesses thrive?

I don't expect Boucher is going to change his ossified mindset. He'll be flushing taxpayer money down the Virginia Creeper toilet until he's finally hauled out in his wheelchair many years from now.

But younger minds, those intent on actually doing something that will have a positive impact on our communities, can - and should - start looking to the future. That future is indeed bright.

And destiny awaits.
 
posted by Jerry Fuhrman
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