If we lost Viet Nam, we were told that the domino theory would hold—the United States would lose Southeast Asia. And, for at least two decades, that was true. It took the collapse of communism and the growth of capitalism that created new relationships with Viet Nam, Cambodia and Laos. Today, we are seeing a new domino theory—based on trade and transportation.
“This discredited way of thinking has had a revival of late. The Suez Canal has been paralyzed because of missiles fired by Houthis rebels in Yemen. This has resulted in international trade being greatly impeded.
Such a threat is real. The economic vitality of the entire Western world has been jeopardized.
The Suez Canal has been virtually shut down to commercial container traffic. Because of this, the three largest container carriers in the world, Maersk, Mediterranean Shipping Company (MSC), and Hapag Lloyd, have rerouted their vessels around the tip of Africa for safety reasons.
Such a detour has caused delays of about three weeks for cargo primarily destined for Western Europe. While this is going on, it is anticipated freight rates will climb by 30 to 40%.”
It took years to discredit the Viet Nam domino theory. The same can be said of the Suez Canal. As long as Biden refuses to kill off the terrorist—and wants Israel to stop fighting the terrorists—it will look like the domino theory is alive and well.
Domino Theory Lives! By Richard Eber
Richard Eber, Exclusive to the California Political News and Views, 1/23/24 www.capoliticalnewsandviews.com
At the height of the Cold War, we all remember the Domino Theory espoused by Secretary of State John Foster Dulles. It postulated that if one country fell to Communism, surrounding States would also fall to the Red menace.
Later, the domino theory was used for justification of the Vietnam War.
This discredited way of thinking has had a revival of late. The Suez Canal has been paralyzed because of missiles fired by Houthis rebels in Yemen. This has resulted in international trade being greatly impeded.
Such a threat is real. The economic vitality of the entire Western world has been jeopardized.
The Suez Canal has been virtually shut down to commercial container traffic. Because of this, the three largest container carriers in the world, Maersk, Mediterranean Shipping Company (MSC), and Hapag Lloyd, have rerouted their vessels around the tip of Africa for safety reasons.
Such a detour has caused delays of about three weeks for cargo primarily destined for Western Europe. While this is going on, it is anticipated freight rates will climb by 30 to 40%.
There is concern a Domino chain reaction may occur. The impact could result with recessions in China, Japan, Korea and several counties in Western Europe. Indirectly, the United States may be adversely affected as well.
Finally, the Biden administration has reacted by placing Yemen back on the terrorist list of countries. This designation was lifted when he took office.
Problems of passage thru the Suez Canal will not be resolved quickly. As a remedy, the United States and United Kingdom have been lightly bombing Houthis positions. They are trying to discourage the Iranian proxy from continuing to shoot at merchant marine traffic.
Despite recent military actions, the Houthis have still not received the message. Stronger measures will soon be needed.
This will not be the first time Suez has been under attack. In 1956 England, France, and Israel briefly seized the waterway from Egyptian control. President Dwight Eisenhower ended up intervening with his allies to withdraw their troops.
Panama Canal Difficulties
Along with problems pertaining to the Red Sea, the Panama Canal is suffering as well. It is congested because of a drought that has resulted in delays for container vessels. Movements to the United States Gulf and East Coast ports are being held up from between 10 and 14 days.
The shortage of fresh water used to fill the locks allowing vessels to transit is real. In desperation Maersk Line has initiated a rail Landbridge from the West Coast of Panama to the Atlantic. This will speed critical supply chain cargoes. No doubt this premium service will add considerable expense for consumers when products are sold in the USA.
Meanwhile the economies of the United States, Western Europe, Japan, China, and other countries will continue to be adversely affected. Increased freight costs will limit commerce. No doubt more inflation and recessions will follow as the dominoes of trade tumble.
What to do?
The blockade of the Red Sea must be dealt with quickly. The United States and their NATO allies need to wipe out the abilities of the Houthis to threaten merchant shipping. The best way to do this is thru Iran who supplies munitions to the rebels.
Instead of allowing the Houthis, Hamas, Hezbollah, and other Iranian backed proxies to continue military operations in the Middle East, the Islamic State must be directly confronted. They need to understand, the next military operation against merchant vessels will result in their homeland being bombed.
It will be necessary to replace American appeasement and restraint. These policies have prevailed under Joe Biden. This weakness has greatly reduced American influence in the region.
Problems associated with the congestion at the Panama Canal are another matter. Much of the traffic to and from the Far East can be directed to West Coast ports. Long Beach-Los Angeles, Oakland, Seattle-Tacoma can take pressure off the Canal. To do so:
· Railroads in particular can assist transiting containers to the Midwest and East Coast in particular. To assist, California needs to lift pollution restrictions in California ports for operating diesel-powered trucks. They must also get off the case of owner-operators who they have been trying to force unionization.
· The International Longshoreman’s and Warehousemen Union (ILWU) has to do their part as well. Needless delays, slowdowns, and work stoppages are to be avoided. No more nonsense of the union honoring the picket lines of Pro-Palestine demonstrators as occurred recently in the Port of Oakland.
· Seattle-Tacoma, and even Portland may prove to be more important than California ports in easing congestion. These Northwest transit centers are all connected with the Burlington Northern Railroad. Warren Buffet’s major investment has a 4-day express clear track service to Chicago that is most useful.
.
Hopefully the Biden Administration will take on the transportation crisis seriously for a change. Department of Transportation Secretary Pete Buttigieg should concern himself more with moving cargo than mandating diversity training and filling racial quotas.
The same holds true for California where Progressive ideology and climate change initiatives need to be put on hold until shipping lanes are fully restored.
Businesses from Walmart, IKEA to automobile manufacturers cannot afford delays in transit; not to mention additional transportation expenses.
There is no reason the dominoes of economic commerce need to tumble. It should not be necessary to return to the days when Nero fiddled while Rome burned.
The stakes are simply too high.
