Another Threat to the Supply Chain

Insights and Market Perspectives

MASK MANDATES are likely to end by March, as a tidal wave of opposition forces state officials to capitulate. Vaccine mandates are a tougher issue to resolve, as angry truckers threaten to disrupt the already-fragile supply chain.

GROUND ZERO FOR THIS MOVEMENT is in Ottawa, where truckers, anti-vaxxers and right wing activists have inspired an uprising that could spread to the U.S.

JUST AS THE “YELLOW JACKETS” disrupted cities in France four years ago, this protest has grown exponentially in recent days. As in France, the initial issue (fuel prices) has morphed in North America into a general protest against the establishment and economic grievances.

THE IMMEDIATE CONCERN is the disruption of auto and agricultural trade between the U.S. and Canada, as protesters block the Ambassador Bridge between Michigan and Ontario, which carries about 25% of goods traded between the two countries. Another border crossing, between Montana and Alberta, has also been blocked.

AT LEAST SIX CAR-MAKING PLANTS in Ontario have halted or slowed production. and agricultural trade is now threatened. Between 5,000 and 7,000 trucks use the Ambassador Bridge daily, many delivering automotive parts.

WHAT TO DO? Canadian Prime Minister Justin Trudeau has been reluctant to negotiate with what he calls a “fringe minority,” but some analysts feel there has to be a resolution soon — perhaps by calling out more troops and towing the trucks away, or denying the drivers food and fuel. Negotiations are possible but both the U.S. and Canada seem reluctant to end vaccine mandates.

EVEN IF THE TRUCKERS win a settlement that opens the Ambassador Bridge, there could be another convoy of trucks seeking to hinder trade in the U.S. Protesters may attempt to disrupt this Sunday’s Super Bowl in Los Angeles, then move on toward Washington in time for the March 1 State of the Union address.

THIS COULDN’T COME AT A WORSE TIME for beleaguered President Biden, who is devoting most of his attention to Ukraine. We had thought Biden and virtually all governors would call for lifting mask mandates by March, but angry voters could succeed in moving up that timetable.

AN AGREEMENT ON VACCINATION MANDATES seems far more of a challenge. About 65% of Americans are “fully vaccinated,” but that doesn’t include booster shots. Of that 65%, only 40% have the third shot, even though it clearly reduces deaths and hospitalizations. Omicron is killing over 2,000 Americans a day, almost all unvaccinated.

NEVERTHELESS, THE URGE TO MOVE ON is irresistible — it has unleashed a ferocious pushback against mandates from people who are sick and tired of the pandemic. And now a new issue has emerged: the threat of civil unrest.

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