This is bad news. According to the Virginian Pilot, container volume at Virginia International Terminals has dropped from a high of “about 85,000 to 87,000 a month at the peak of 2008, they have been in the low 60,000 range for the past four or five months.” While the Port of Miami and shipping terminals like Charleston, New York, Boston have likely seen the same relative drop in their traffic as well, the Virginia Port Authority container traffic gives us a good idea of how much consumers have cut back on their spending.
I am no economist, but I remember remarking to my wife that we’d be lucky if unemployment didn’t hit 10% nationally. Taking into account the number of houses still on the market, the number of pages in the Roanoke Times dedicated to job listings is barely 2 or 3 pages on any Sunday, the number of 2008 model cars still sitting on the lots, and the increase in spending at thrift and discount stores, this is not surprising that the container traffic has dropped this much. But, this is still very disconcerting.
There is probably about another two to three months that the American public will give President Obama the benefit of the doubt about the economy that was passed off to him. But even I could see, with my liberal arts degree, that it was likely the unemployment rate would surpass 8%. Despite some companies in the auto supply chain seeing an increase in orders for products to build the new, fuel efficient cars, who will be able to buy them as unemployment approaches and probably surpass 10%? The 8% or 8.5% projected unemployment rate by the Obama Administration missed the mark by a long shot.
The federal government had to take drastic measures to make sure that the American and global economy didn’t fall off the cliff. These moves started with the Bush Administration in September and October of 2008 and continued through the first 100 days of the Obama Administration. Things were so bad that President Bush had a literal road to Damascus conversion, from a no regulation free market advocate to government is the solution believer.
The reality of how bad the American and global economy is doing, is reflective in the dip in the container traffic, continued revisions of state budgets and shrinking revenues, and the political unrest in Iran and other parts of the world. Iran’s unrest isn’t only about a disputed election. It has a great deal to do with their struggling economy as well. The clock is ticking on President Obama to get the stimulus money out faster and to show he has taken the appropriate steps to get us out of the recession. Fair or not, the American public’s patience is wearing out and the President’s standard line of “this is going to take time” for things to turn around is starting to sound like an empty promise.