- The Washington Times - Wednesday, January 25, 2012

The Obama administration Wednesday pledged new measures to better secure the global trade and transportation systems against terrorism, crime and natural disasters.

“The global supply chain system … is essential to the United States’ economy and is a critical global asset,” President Obama wrote in his introduction to the high-level strategy report.

The six-page document lays out the goal of a secure and efficient worldwide network of just-in-time airfreight deliveries, container shipping and railroads and highway systems that power the international economy.

It proposes close cooperation with the private sector and with foreign governments, but it makes no specific policy proposals. Those will come later, officials say, as the strategy is implemented throughout the federal government by the Department of Homeland Security.

“It is very broad brush,” said John Rose, chairman of the national security committee of the American Institute of Aeronautics and Astronautics.

Mr. Rose noted there was often a “tradeoff” between the strategy’s two goals of security and efficiency.

“Those aren’t necessarily always things that are achievable in tandem,” he said.

The system’s seamless efficiency has boosted global productivity and lowered prices.

However, it has also made national economies like the United States vulnerable to events in far away countries. Interruptions in the system anywhere rapidly ripple across the globe, as they did when the tsunami in Japan last year stopped work at many factories there and destroyed much shipping.

The global supply chain must be protected against disruptions “caused by natural disasters - earthquakes, tsunamis and volcanic eruptions - and from criminal and terrorist networks seeking to exploit the system or use it as a means of attack,” Mr. Obama says in the report.

Having a single trusted supplier that delivers on schedule can generate profits for a business but also can cause problems if his factory is damaged in a natural disaster or his region is sucked into political turmoil and conflict.

“Supply chains have become about as lean as they can get,” said Elaine Dezenski, senior director of the World Economic Forums’ Risk Response Network

“That means they feel disruptions more severely,” she said, adding that they also might lack the ability to recover from disruptive events afterward.

“How do you balance efficiency and resilience?” she asked.

That is a question that the strategy poses rather than answers, according to homeland security consultant Jessica Herrara-Flanigan.

“This says, ‘Here are our goals,’ ” she said. “The real meat is what comes next … as they implement them.”

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