Biden’s Supply Chain Resilience Council ‘Long Overdue’

Glenn Taylor
·5 min read
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President Joe Biden is convening the first meeting of his supply chain resilience council on Monday, using the event to announce 30 steps to strengthen national supply chain operations. These include enabling faster, reliable deliveries, shoring up the America’s agricultural and food systems, and improving access to medicine and critical economic data.

Alongside creating the council itself, the Biden administration developed several cross-government partnerships to bolster supply chain monitoring and strategy, and expanded the Department of Transportation’s (DOT) digital information sharing system, the Freight Logistics Optimization Works (FLOW) program.

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According to the DOT, participants are beginning to use FLOW data to inform their logistics decision making, helping to avoid bottlenecks, shorten lead times for customers, and enable a more resilient and globally competitive freight network through earlier warnings of supply chain disruption.

Dr. Chris Caplice, executive director at the MIT Center for Transportation & Logistics, said there is a role that the government can play to assist companies in improving the efficiency and effectiveness of their supply chains, as long as it’s in the right doses.

“The government is generally not great at running supply chains—I am NOT arguing for centralized control of supply chains from Washington. That would be a disaster,” said Caplice. “However, government agencies can assist the private sector by collecting, harmonizing and disseminating data from multiple stakeholders. As a trusted source, the government can provide an end-to-end snapshot of global supply chains. The FLOW initiative is an excellent example of where the government can develop tools and methods to support the private sector.”

The public-private partnership, developed in March 2022 when the Ports of Los Angeles and Long Beach experienced expensive weeks-long backlogs, aims to create a shared, common picture of supply chain networks and facilitate a more reliable flow of goods across the major points of trade: ports, terminal operators, truckers, railroads, warehouses and beneficial cargo owners (BCOs, or shippers).

Retailers participating in FLOW include Walmart, Target, Albertsons, Best Buy, Costco, Dollar General, Gap Inc., The Home Depot, Lowe’s, Nike, Ralph Lauren, Tractor Supply Co. and Ulta Beauty. UPS, FedEx, DHL, C.H. Robinson, seven major ocean carriers, and rail giants BNSF and Union Pacific also joined the network.

The DOT is also launching an Office of Multimodal Freight Infrastructure and Policy, responsible for maintaining and improving the condition and performance of the nation’s multimodal freight network.

“I view these efforts as a long overdue recognition by the federal government that the dramatic increase in reliance on foreign inputs and contract manufacturing, especially from countries that are not necessarily aligned with the U.S. geopolitically, poses serious national security implications that require careful assessment,” said Jason Miller, interim chairperson, department of supply chain management at Michigan State University’s Eli Broad College of Business. “The government is in the best position to bring together the relevant stakeholders to address these issues.”

The Department of Commerce took the step of creating a new Supply Chain Center to develop supply chain risk assessment tools, collaborating with Department of Energy to examine clean energy supply and the Department of Health and Human Services to assess industry and import data that can help address foreign dependency vulnerabilities and points of failure for critical drugs.

The White House Council on Supply Chain Resilience will be co-chaired by National Security Advisor Jake Sullivan and National Economic Advisor Lael Brainard. Additional members will include heads of other White House cabinet departments, as well as U.S. Trade Representative Katherine Tai and Attorney General Merrick Garland.

By establishing the council, Biden broadens the Department of Health and Human Services’ authority under the Defense Production Act, to enable domestic manufacturing of essential medicines and their inputs.

The new council will also launch a quadrennial supply chain review. During the inaugural review on Dec. 31, 2024, the council will update criteria on industries, sectors, and products defined as critical to national and economic security.

The White House highlighted prior investments by the Biden administration to strengthen supply chains and prevent future disruptions, attributing the normalization of flow of goods, and lower inflation rates to bills such as the CHIPS and Science Act, the Inflation Reduction Act and the Bipartisan Infrastructure Law.

In the two years from October 2021 to October 2023, supply chain pressures as measured by the Federal Reserve Bank of New York declined from near-record highs in December 2021 to a record low, which the administration said helped lower inflation, which has fallen by 65 percent from its peak of 9.1 percent in June 2022.

Miller told Sourcing Journal that he was “far less convinced” of what the government describes as a link between supply chain improvements and falling inflation.

“Much of the inflation was due to excessive stimulus, which caused incredible demand, which put strains on various supply chain nodes,” said Miller. “The February 2021 polar vortex didn’t help as well.”

That month, newly elected Biden signed his first executive order aimed at strengthening the resilience of U.S. supply chains, requiring several government agencies to deliver reports identifying supply chain risks. Four months later, the Biden administration established a Supply Chain Disruptions Task Force that worked with states, tribes, local governments, businesses, family farms, labor and allies and partners to address the acute supply chain crises caused by the pandemic.