Supply chain crisis linked to ‘whole host’ of Biden policy decisions: Former transportation secretary

China’s COVID lockdowns could further threaten supply chain, global economy

Former U.S. Labor Secretary under George W. Bush and Transportation Secretary under Donald Trump Elaine Chao explained how she would fix the ongoing supply chain crisis, arguing that it starts by getting inflation under control on "Varney & Co." Wednesday.

"The supply chain issue is linked to a whole host of policy decisions that have been made by this administration," Chao told FOX Business’ Stuart Varney. "It's an issue about inflation."

Inflation hitting a new 40-year high in March coupled with the possibility of more shipping delays due to China’s latest COVID-19 lockdowns puts pressure on President Biden to find a solution sooner rather than later.

"This is putting increasing demand at precisely the time when the supply chain is actually quite still fragile and vulnerable," Chao said.

VARNEY ON CHINA LOCKDOWNS: THE WORLD'S SUPPLY CHAIN IS ‘THREATENED’

Uncertainty surrounding further supply chain delays forces consumers and companies to order more products now before they run out, according to the former Transportation Secretary.

"They're not quite sure if they're going to get what they need within the time-space that they need," Chao explained, "so they order more, and that increases, again, the pressure on the supply chain."

As an expert in the labor sector, Chao praised the "unsung heroes" who have worked in the supply chain during this time.

"Those include truckers who have kept our shelves fully stocked," she noted, "and railroad workers, port workers and also air traffic control workers."

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In July, West Coast ports will hold renegotiation talks with union dockworkers for new contracts. And if workers aren’t pleased, Chao warned of a possible strike.

"If there is a strike with the West Coast ports this coming July, that would place obviously a lot of bad pressures on the economy, increase inflation and further disrupt the supply chain," Chao said.

Chao again criticized the Biden administration’s post-pandemic response to the jobs market, claiming there would be 10 million more workers in the economy today if the labor participation rate was the same as when she was secretary.

"That would certainly help us to address the workforce issue and get us out of the doldrums in terms of a more vibrant economy," Chao pointed out.

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