Fireworks For The Fourth–Boom, Boom Or Bust?

The pandemic brought with it shortages of various items such as toilet paper and cleaning supplies. While TP and Clorox wipes are back on the shelves, something else is now in short supply–fireworks. As a result, the ability to celebrate our nation’s birth in fitting fashion, i.e., lighting up the sky with dangerous pyrotechnics that produce smoke, noise, and color, was an iffy proposition this year. Would it be boom, boom or bust for John Q. Citizen on the Fourth?

When threatened with a scary coronavirus, it makes sense folks would need to disinfect their homes; thus, cleaning supplies sold like hot cakes. But why on earth would fireworks be a hot ticket item? The short answer? Boredom and lack of entertainment. After a quarantinee (is that even a word?) has watched every Netflix movie and series (perhaps more than once), what else is there to do? Why go out in the backyard and shoot off some fireworks for fun.

Statistics reveal the skyrocketing (pun intended) popularity of things that go boom boom The fireworks industry experienced record sales in 2020 with revenue nearly doubling from $900 million in 2019 to $1.8 billion in 2020. With public fireworks shows cancelled thanks to COVID-19, in 2020 Americans were forced to produce their own light shows.

During the pandemic, the demand for fireworks was not, however, limited to the Fourth of July. Customers bought them for various occasions including Halloween, New Year’s, and the Super Bowl too. Nothing releases pent up pandemic frustration than making something explode.

Typically fireworks inventories carry over between seasons. Vendors, however, faced empty shelves and the inability to replenish them after 2020. The shortage of fireworks was not just a problem in the United States; the dearth of available fireworks became a global issue. So, everyone in the world found themselves in the same boat–facing a deadly virus without the ability to set fireworks off as they awaited their fate.

Why was there such trouble keeping shelves stocked with fireworks? Several factors contributed to their scarcity. First, due to the pandemic, fireworks factories in China were shut down. So what if the Chinese cannot produce fireworks? Let’s just say Americans rely on products stamped “Made in China.” More than 95% of the fireworks imported to the U.S. have come from that country for years. In fact, the U.S. obtained 255 MILLION pounds of fireworks from the Asian country last year. That’s lot of bang being bought with American bucks.

While American manufacturers do produce some fireworks, imports have outstripped domestic made for a long time. Uncle Sam isn’t the only one ordering things that go bang from China. That country, which originally invented fireworks, is the largest manufacturer and exporter of fireworks in the world.

In addition to Chinese factories being shuttered, shipping issues add to the inability to get what fireworks are available to the U.S. Global container shortages hamper the ability to ship the fireworks, and only about 70% of ships are currently in operation. Fireworks are classified as dangerous goods (ya think?) and given less allotted space on the freighters which are operating.

Once fireworks arrive in the U.S., hurdles still exist to getting them on the shelves for sale to the public. An insufficient number of dockworkers has led to port delays. Labor shortages in this country in the supply chain, specifically of truckers, further adds to the end result of limited fireworks inventory.

Even if fireworks reach a vendor’s shelf, the product may still not be available in the sense that it is too expensive for purchase. Prices in the U.S. this year were projected to be up 15% to 20% over the cost of fireworks last year. Why the increase? Raw materials in China have risen 5% to 8%. Shipping costs have increased 250% to over 300%. Costs going up may mean Americans can’t afford to send fireworks up to celebrate the event of their choice.

And perhaps a bust with a low supply of fireworks is a good thing. If buying fireworks strains the budget, people will opt to attend public fireworks displays presented by professionals trained in shooting fireworks off safely. But who wouldn’t take care when setting fire to something meant to explode with a big bang? Answer? THOUSANDS OF PEOPLE.

The U.S. Consumer Product Safety Commission reported 18 fireworks related deaths not connected with a pyrotechnical company in 2020. Injuries from fireworks sent approximately 15,600 to emergency rooms that same year, an increase in the number of injuries from 2019. So, Americans may be getting older, but they aren’t getting safer when handling things that go boom boom.

Sadly, 2021 brought a high profile death to the news as the result of a fireworks mishap. Twenty-four year old professional hockey player Matiss Kivlenicks, a goalie for the Columbus Blue Jackets, died from chest trauma from a fireworks mortar blast. One minute Matiss was relaxing and enjoying the holiday in a hot tub. The next he was headed to that big ice rink in the sky.

While Kivlenicks’ death received great media attention as it occurred while the Stanley Cup Finals were underway, thousands of others undoubtedly injured hands and fingers, heads and faces, eyes, ears, legs, and arms while shooting off fireworks. While we’ve all heard to watch out for things that go bump in the night, Americans aren’t doing a good job of be careful with things that go boom in the night sky.

Fireworks are universally loved. People are thrilled to watch explosions overhead in the night sky which display light and color. But the current fireworks shortage may be a blessing in disguise. Does every man, woman, and child need to shoot off these dangerous items themselves? Maybe fireworks are best and most safely viewed when set off by professionals. Let’s keep away from the boom boom makers and save ourselves from the bust of physical injury so we can live to celebrate the next occasion calling for pyrotechnics. And if less Americans buy fireworks, less money ends up in the pocket of a large communist country which is at odds with our country. That result may be an occasion to celebrate. Fireworks, anyone?

Just WONDER-ing:

Did you set off any fireworks this year or did you simply attend a public display? Have you or anyone you know been injured by fireworks? If you knew not buying fireworks would reduce the profit to dangerous country, would that affect your purchasing decision?

War Of The Wares

 

The U.S. is at war!  Fortunately, it is not a war of the worlds involving aliens invading from another planet. No, the current war is a bit less dramatic. It is a trade war between the U.S. and China, the world’s two largest economies.  While no Americans will be sent to the front lines to fight this war, the war is bound to negatively affect the bottom line of the American consumer’s  budget. So it pays to be in the know about what’s going on.

A trade war is not a conventional war. No bombs or bullets are utilized. The weapon of choice?  A tariff. Tariffs have nothing to do with the military; they are an economic weapon. To be precise, a tariff is a tax or duty to be paid on a particular class of imports or exports.

Tariffs are not a modern innovation. No, sir.  In fact, the very first act passed by Congress under our Constitution was a tariff law; this 1789 law imposed tariffs up to 50% on imported steel. In fact, tariffs were the greatest source of federal revenue until the federal income tax was established in 1913.

Be aware that we are living in historic economic times.  The U.S.’s current trade war with China is likely to eclipse the Chicken War of the 1960’s. What? You’ve never heard of the Chicken War? What kind of American history books are they writing?

In the Chicken War, France and West Germany were the U.S.’s enemy instead of China. The bad guys imposed a tariff on imports of U.S. chicken which were voluminous since Europeans considered chicken a delicacy. American chicken exporters squawked at the tax; in retaliation, the U.S. imposed a punitive tariff on light trucks (think VW vans), brandy, and other European products. .(Trade) war is hell, and the tariff on brandy was soon lifted as sober U.S. heads prevailed and took heed of the complaints of diSPIRITed U.S. imbibers unhappy about paying more for their imported spirits.

Fast forward to July 6, 2018 when the current trade war began.  The U.S. imposed 25% tariffs on $34 billion of Chinese goods in response to complaints that China steals or pressure U.S. companies to hand over technology. This move made good on a campaign promise made by Donald Trump to crack down on Chinese trade practices which have cost American jobs. Take that, Beijing!  China fired back by imposing higher tariffs on a similar amount of U.S. goods. Back at you, Washington, D.C.!

China asserts that the U.S. is being a bully and is igniting the largest trade war in economic history. But, of course, China does not want to change the economic status quo. Why not?  Because the U.S. has a $375 billion U.S. goods trade deficit with China. That’s BILLION with a “B.”  In 2016 China was the leading supplier of goods imported to the U.S.  China imports far less from the U.S. than the U.S. imports from China.  It’s top import from the U.S. by value is soybeans. (Soybeans?)

So each country has imposed higher tariffs on certain goods of the other country.  Now what?  Round 2, naturally. A possible second round of tariffs targeting a $200 billion list of thousands of Chinese products is being considered by the U.S. The first round of tariffs focused on Chinese industrial products in an effort to reduce the direct impact on the American consumer.  The new list under consideration is more extensive, containing consumer products such as vacuum cleaners and furniture. I’m no economic expert, but I’m pretty sure that China’s response will be to raise tariffs on additional U.S. goods  exported to that country.

Where will this economic madness end?  My bet’s on the U.S. coming out on top. The bad news is that our country has a gargantuan trade imbalance with China; China only imported $130 billion of U.S. goods last year, and the U.S. already has a trade deficit exceeding that amount for 2018 as of May 31st of this year. The good news is that China’s imports of U.S. goods are small enough that at some point it cannot match new U.S. tariffs. Nanny, nanny, boo, boo, Beijing!!!

In the meantime, what will happen?  Well, hang on to your hat!  Don’t have one? You better order your “Make American Great Again” cap NOW.  IncredibleGifts, which imports red hats from China and embroiders them here with that phrase, will have to raise prices if the hats end up having to be made here in the U.S. as opposed to being made in China, shipped here, tariff imposed and then embroidered in the U.S.  The cost of these hats could skyrocket from $9-$12 to $20.  That’s not great!

The mounting tension between Beijing and Washington, D.C. provides an economic summer blockbuster. Despite the possible ramifications of the trade war, the average American is hardly on the edge of his seat following the plot. Why?  Apparently red ink is less captivating that bloodshed. Perhaps all that is needed to catch John Q. Public’s attention is a catchy name for this war. But it’ll be hard to top the Chicken War. Maybe we could just refer to the situation as “America’s Got Tariffs.”

JUST WONDER-ing:  Had you ever heard of the Chicken War? Were you aware that China and the U.S. were in a trade war? To what extent do you follow economic news?

 

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