What your grocery store is telling us about supply chains

Make Me Smart April 27, 2022 transcript

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Kimberly Adams: Well, we’re back into the swing of things.

Kai Ryssdal: And there, I believe is, Charlton. I don’t even know who that is, it’s probably Jayk or somebody. Anyway, hey everybody. Welcome back to Make Me Sm – he’s minute early, by George. Welcome back to Make Me Smart where we make today make sense. Whew.

Kimberly Adams:  Or at least make a generalized attempt. And I’m Kimberly Adams back from vacation just in time for Whaddya Want to Wednesday when we answer your questions. And you can email us those questions to makemesmart@marketplace.org, or leave us a voicemail, our number is 508-U-B-SMART. And with that Kai sigh, here’s our first one.

Melissa: Hey, Make Me Smart team. It’s Melissa from San Francisco. I’m not cool enough to have a Twitter account. But somehow Elon Musk is all over my news feed. So can you make me smart?

Kimberly Adams: I guess I should take this one was like the news that would just like, you know, hit me in the face as soon as I logged back into everything coming back from vacation. And I should say it’s very funny, because when I was listening back to the show, I believe that you bet one of your entire paychecks.

Kai Ryssdal: I might have done that. Yes.

Kimberly Adams: He wasn’t going to buy Twitter. Anyways so yes, lots to say here within the space of like 11 days, Elon Musk, who is the CEO of SpaceX and Tesla said he was going to buy Twitter, Twitter then tried to create this like poison pill, shareholder rights plan to stop that sale, then Twitter backed off from it and abandon that poison pill and accepted Elon offer to the tune of about $44 billion, if I’m not mistaken. So now it looks like the world’s richest man is going to control one of the world’s largest social media platforms. And in terms of what he says he wants to do, he says he wants to promote and I’m putting us in air quotes, “free speech,” which to him based on what we know so far means less content moderation, and he doesn’t like the idea of banning people. So some folks are thinking that he’s going to bring back some of the people who’ve been banned from Twitter, most infamously Donald Trump, but we don’t know for sure. He also wants to make the algorithm that, you know, helps Twitter feed you different things and make certain tweets more popular, he wants to open that up and allow it to be more open source so people can see how it works. And he says he’s going to, you know, go after the spam and bot accounts, possibly by forcing everyone to verify who has an account that they are a real human, which can have some problems for activists in other parts of the world who need to be on or even here in United States who may need to be anonymous. And then, you know, much to the hope of many Twitter users, he says he might consider an edit button. So this is going to potentially mean a lot of changes for what it’s like to use Twitter, it could mean changes for who uses Twitter. So there’s this example that Marissa put in here. On Monday, several big accounts like Katy Perry, Barack Obama, and others lost hundreds of thousands of followers, while some other accounts including representative major retailer Green and I saw Donald Trump Jr. posting about this gained large numbers of followers Twitter says this was organic, reflecting people deactivating or making new accounts, but lots of folks are suspicious. So that was a long answer. But.

Kai Ryssdal: Yeah, I mean, look, I have a medium-sized account. I lost like 2000 followers, not that I track it all the time. But you know, I went back and I had a look. And so…

Kimberly Adams: You, you do not have medium-sized account Kai. Like, on what scale?

Kai Ryssdal: I mean, well, compared to you know, Katy Perry and Elon Musk and Barack Obama, but but looks so here’s yes to everything Kimberly said, I also think this and it’s not my fault. It’s Walt Mossberg, who was for many, many years, the tech guy at the Wall Street Journal, he basically came out today this news broke of the actual sale and said, “You know what a zillion things are gonna happen between now and the time the deal closes, we just don’t know.” And I think that’s right. We just don’t know, you know.

Kimberly Adams: And one of the things that, you know, you and I have had this conversation, because sometimes we do like Twitter call outs, looking for sources and things like that. But only like 23% of Americans even use Twitter that’s less than the number of people who use YouTube. And so Marissa was citing Pew, as – did this report a of 2021, only 23% of Americans use Twitter, compared to 81% of those who use YouTube and 69% who use Facebook. And who uses Twitter? It’s pretty skewed, you know, tend to be, actually let me not even give stats, I don’t know, but it’s not representative.

Kai Ryssdal: No, no, no, but yeah, we all know is not representative below one more thought on this, and then we should probably move on. For me the issue is not –and I when I talked to Lauren Hirsch about this the day the news broke from the New York Times has been covering the story for for since the beginning. It’s not about the 23% of American users. And it’s not about “ooh Elon Musk is being a jerk,” although it’s a little bit about that. It’s about an American oligarch, right? Buying a global communications platform. That’s what it’s about. And, and that I think is the part that gives a lot of people pause, rightly so.

Kimberly Adams: But how different is that from Jeff Bezos owning the Washington Post? Or I forget – okay.

Kai Ryssdal: I’ll tell you exactly, exactly how it’s different. I’ll tell you exactly how it’s different, right. Jeff Bezos bought an established journalism institution and said at the jump, I’m gonna keep my hands off. And as far as we know, he has other than that “Democracy dies in darkness” tagline, right? That apparently was him. But other than that he’s kept his hands off. And there are professional journalists, right, who abide by a code of conduct that is established over literally centuries, right. Twitter is a bleepin’ free for all. Right, run by and now about to be owned by, well about to be owned by I don’t know who’s going to run it. A guy who has demonstrated very, very loose connections to standards of conduct, or I mean, any of those things. And I think that’s the fundamental difference. Yeah, that’s fair All right. We should move on. Yeah, let’s. Okay, well, why don’t we just hit the tape. Go.

Maggie: Hey, this is Maggie from Okeechobee, Florida. I am a parts manager at a power sports dealership. So the past two years of the pandemic, I’ve got see how long it takes, you know, suppliers and manufacturers to get parts. And I’ve had a running joke that depending on how long my backorder queue, is, you know how long the pandemic is going to last. And I’ve seen it shrink and lengthen buncha, bunch of time. Now my question for you guys is, is there any truth to that? Is there any barometer? Could we use shipping containers? Can we use parts on backorder? Could we use microchips that shows us how long we really are going to be in this supply-induced pandemic? Or is it all just, you know, buckle down for the next couple of years? Because things will just never be the same?

Kai Ryssdal: Oh, yeah, really good question. And the answer to all of those questions in there is yes. Because number one, it is buckle down, because this is going to be with us for a while. The Biden administration says so, the Federal Reserve says so. This is a supply challenge that that all of us are having. And let’s just let’s just let’s back up for a second and talk about where Maggie is, right? She’s a parts manager at a power sports dealership, right? So she is one step removed from the end user. So between the time that something gets off a containerized ship, and gets through Maggie, it’s gone through storage and warehouse. It’s gone through train transport and truck transport. So there’s a lot of things that happen on the way that would account for Maggie’s individual order list, expanding and contracting. But the thing I look at is container ships waiting at the Port of Los Angeles and Long Beach. Number one is because I’m here and number two, I’ve done reporting down there. But number three, something like 40% of all the containerized goods in this entire economy come through that port that’s 15 miles down the road from me, right. And here’s some context. On the ninth of January, that backlog of containerized ships reached its pandemic high of 109. Today, it’s about 45 or 50. Okay, so it’s getting better, but slowly, but oh, look, the port of Shanghai and Ningbo over in China are now currently locked down. And their backlog of ships waiting, coming in to load is way up. So you just got to deal. You just got to deal.

Kimberly Adams: So I, as you, as you know, recently had reason to be in multiple large ports in Europe.

Kai Ryssdal: Ooh you were in Europe? I didn’t know you were in Europe.

Kimberly Adams: Yes, I was in Europe, yes.  No it wasn’t, parts of it were. But anyway, that’s another story. But I was paying attention to this because of all the reporting that we’ve been doing on this. And so I was looking and seeing like, how many ships were docked. How many ships were at anchor container ships were at anchor, like out from the port, how many ships were there, how high the stacks of containers were at the various ports. And it was very different at each of them. Some of them, you could see like six or seven ships, which I know is relatively small compared to the ports that you’re talking about, at anchor way out from the port and not many containers hanging out. But in another one, the containers were stacked like super high and passed a lot of LNG ships, believe it or not.

Kai Ryssdal: Nice. Oh, yeah. Yeah, yeah, yeah totally believe that. Very interesting.

Kimberly Adams: Around, around Europe. So that was very fascinating. I’d never seen one of those before. But I saw several, and then several ferries with trucks on them carrying LNG and other types of gas. So it was fascinating to watch stuff moving around.

Kai Ryssdal: Oh, yeah, that’s, that’s so interesting about the LNG ships, holy cow. Man.

Kimberly Adams: Oh, I suppose I should give some context to that. So because you know, the Russian oil is being cut off and the sort of global energy shock, that means that more people are looking to get liquefied natural gas to Europe, because Europe has now various types of fuel shortages, because they’re not buying oil from Russia and coal from Russia. And so there has to be a lot more energy moving into Europe from other places. So I’m guessing that some of what I was seeing. All right. Let’s try to get this last one in. Right right right.

Kai Ryssdal: Come on! We haven’t talked in a long time.

Kimberly Adams: I know!

Kai Ryssdal: Don’t shut me down. No, I’m kidding.

Kimberly Adams: Okay, so here’s another question about supply chains, this time at the grocery store.

Leslie: Hey, this is Leslie from Spartanburg, South Carolina. And I have a question about the food supply chain. I have just left my local big box retailer. And I noticed that things like chicken breast and ground beef are in short supply. But things like giant packages of chicken drumsticks and huge boxes of marinated and ready to go pork roast are all over the shelves. Same thing with mixed vegetables versus single-ingredient vegetables. And I’m wondering why are so many of the prepared foods and more processed foods more available right now than some of the single ingredient foods. Thanks for making us smart.

Kai Ryssdal: It’s a really good question.

Kimberly Adams: It is a good question. And I also have seen this in the store where you can get like all of the frozen stuff, but not as much of the fresh stuff as often. But to get a more technical explanation than what I see in the grocery store. Yesterday, we called up Veronica Nigh, who’s a senior economist with the American Farm Bureau Federation. And she says it all comes down to something that many of us kind of do in the kitchen, which is ingredient substitution.

Veronica Nigh: In a processed product, they have the opportunity to find substitutes for a product in short supply. Whereas when if it’s a single ingredient item, it that’s a lot harder to do. So, you know, if your item requires tomato paste, well then maybe you can use tomato sauce. If you’re thinking about an item that is a premade meal kit, oftentimes, those type of food manufacturers will use a different cut of meat perhaps than they normally would. And so that gives them a lot more flexibility.

Kimberly Adams: So remember, like the great chicken wings shortage of like, what was that, like last year or something and all of a sudden, all of these places were just, instead of there being chicken wings, they were selling the chicken drumsticks or chicken thighs or, you know, whatever, they had to swap it out for something else. If it had been chicken noodle soup that they were selling, they wouldn’t have had to do a rebrand because nobody would have really known because chunks of chicken, whatever. So, you know Veronica pointed out also – well, maybe certain people have a more refined palate and notice exactlyn what part of the chicked it comes from.

Kai Ryssdal: No, I totally get it. Totally get it. Chunks of chicken.

Kimberly Adams: Oh, okay, so but Veronica also pointed out that when you’re talking about processed foods, a lot of these foods are often frozen or shelf stable. Like they don;t need refrigeration or anything. So you can kind of stockpile those and keep them in cold storage. And so you may have had more supply sort of in reserve. And so they’re less that that stock is less sensitive to temporary shortages than maybe fresh foods are. So I mean, if you have, you know, a box of frozen peas, you can stick that in the freezer and sell it six months later. But if you’re selling fresh peas, you know, those are going to be good to sell for like, what a week or two max. So that’s one of the things. And then Oh, one other thing. There is a big issue affecting the supply of eggs and poultry products in particular right now, which is an outbreak of the avian flu, which has affected over 33 million birds in 29 states since January. And it’s so contagious, and folks may remember this from the last time we had a bird flu outbreak. When it shows up in a flock of chickens, they often have to kill the entire flock because they’re so worried about it.

Kai Ryssdal: I had totally missed that. I was not aware that that was going on.

Kimberly Adams: Oh, yeah, that was that was going on before I left. I remember. Okay, yeah.

Kai Ryssdal: Totally missed it, totally missed it. All right.

Kimberly Adams: Well now you know, you got made smart.

Kai Ryssdal: Now you know, got made smart. We’ll call it there. We’ll save that last one, Bridget and you can roll it in next Wednesday. We’re coming back tomorrow we’re gonna do the news. Do some Make Me Smiles, regular Thursday show for you.

Kimberly Adams: Yes. And keep sending us your questions for what do you want to know Wednesday? We promise to stay on task not have so many tangents. You can email us at makemesmart@marketplace.org or leave us a voicemail at 508-U-B-SMART.

Kai Ryssdal: You can rip on your own podcast for crying out loud. Producers, schmoducers, hosts are in charge sometimes once the microphones go on the hosts are in charge.

Kimberly Adams: Never.

Kai Ryssdal: All right, make me smart is produced by Marissa Cabrera today with help from Rose Conlon. Our intern’s Tiffany Bui.

Kimberly Adams: And today’s show was engineered by Jayk Cherry, Ben Tolliday and Daniel Ramirez composed our theme music and our senior producer is Bridget Bodnar.

Kai Ryssdal: Bridget.

Kimberly Adams: Bridget!

Kai Ryssdal: Bridget Bodnar, Bodnar, Bodnar.