Global supply chains and sustainability

(Acknowledgment: All images used in this post sourced from Google image search) 

As kids, whenever we were difficult, our grandpa used to scold us: "Don't be the dog in the manger!" We didn't know what it meant, at that time. This metaphor, coming from Greek mythology, talks of a dog sitting on a bale of hay and shooing away the cattle that come to graze on the hay. "Dog in the manger" basically refers to someone who blocks others from using some resource, and neither uses it themselves. 

This metaphor was made famous (notorious) by Winston Churchill, who used it to justify colonial domination based on a sense of racial superiority: 

What Churchill didn't (or didn't want to) realise was that the native communities weren't protecting a "resource"-- but a complex ecosystem of being of which they were a part of, and would have probably gladly accepted others who can enrich this ecosystem harmoniously. Sadly, Churchill was too deluded about his "higher grade" race, to bother about these nuances. 

Today, Churchill's philosophy still rules the world. Visit tea estates in places like Ooty or Assam, we see entire hill ranges denuded of their rich ecosystem, to be replaced by homogeneous tea plantations, most of which are slated for export. 

A complex ecosystem of flora and fauna had to be destroyed, just so that some folks can have a cup of tea on their breakfast table! 

If it is tea in India, in Africa it is cocoa and diamonds, the demand for which, have destroyed several ecosystems and even today are known to employ child labour and repressive work practices-- just so that someone somewhere can enjoy chocolates or jewellery! 

China's recent growth in construction was supported by raw materials sourced from several countries. India's granite exports to China for instance, far outnumbers its exports to any other countries. This growth in demand for "natural resources" has lead to several forms of illegal quarrying and mining, leading to several hills and forest regions getting literally torn down. 

And let's not even talk about oil and petroleum. 

This entire supply chain is kept running by a variety of structural interventions into the political, economic and cultural fabric of these societies that supply "natural resources." Their currency exchange rates are kept artificially high, by a coterie of currency traders, that create a huge disparity between their market exchange rates and relative purchasing power. For instance, what we can buy for $1 in the US, on an average, we can buy for Rs. 15 in India. This is the "real" exchange rate according to relative purchasing power. But in the market, one dollar fetches close to 80 rupees! This exchange rate is decided by the sentiments of a few thousands of traders in currency markets, whose knee-jerk reactions shape the destiny of the entire country! 

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Having said all this, I am not for one moment suggesting that global supply chains aren't important. Surely, it makes sense to procure raw materials from all over the world for say hi-tech requirements like building computers, airplanes, mobile phones, vaccines, life-saving drugs, and so on. 

So how do we distinguish between "good" and "bad" supply chains? Why is it so "bad" that people across the world can have a cup of tea from our tea estates or some countries can build great cities from the rubble of our hills and forests? 

The difference is that technology that addresses a global need, itself has a universal footprint. When raw materials are sourced from across the world, for building mobile phones, the output can be potentially enjoyed by the entire world. This does not of course, replenish the damage done to the ecosystem in procuring the raw materials, but improved technology carries a hope that we can move on to building better and more efficient systems and reduce our destructive impact on the environment, going forward. For instance, the carbon footprint of several office-goers has drastically reduced thanks to present-day video conferencing, cloud computing, and mobile payments-- catalysed of course, by the pandemic. 

For technology, the problem space is global, and naturally its solution needs to source elements from across the globe. 

In contrast, the problem space of tea and chocolate or construction, is local. On solving this problem, the beneficiaries are only the local population. But to solve this problem, elements of the solution are sourced from all over the world. This leads to a "linear" or "open loop" configuration, that just keeps tilting the balance in one direction, leading to an eventual collapse. 

Yet another example of such a linear, "open loop" solution is the way Bangalore meets its water supply requirements. A large percentage of water used by Bangalore comes from the Cauvery river, which is almost 70 kms away and 600 feet below in altitude. Every day enormous amounts of water are pumped up a gradient, to keep the city running. The "open loop" nature of the problem is literally visible in the water map below:

When water supply for a city is sourced from such far away sources, this only results in disruption of livelihoods and ecosystem of the river downstream, and the benefits that the city dwellers get, are not enjoyed by the ones near the water source. 

Most major cities come up next to major rivers, and that's the reason for it. Bangalore is an exception-- it is the third largest metropolis in India, and which has no natural source of water. Sustainable solutions to our water supply need to be very different from what we have today, which is not at all sustainable. 

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Global supply chains are needed for solving problems of a global nature-- not for local problems, regardless of how superior or "higher grade" the population consider themselves to be.