The only reason that the West has been able to enjoy low inflation and low interest rate for the past two decades，is because the supply chain was orientated towards efficiency and cost. Now they want to change the supply chain towards resilience and security，as a consequence of this approach，the efficiency will drop and the cost will go up. That means the good old time of low Inflation is gone，they now have to embrace chronic high inflation and high interest rate.
Those products made from "high resilience" supply chain is simply not competitive on global stage because of the high cost. The government either have to subsidise it in order to make it competitive，or implement protective policy to shield it from foreign competitor. Either way is the people have to pay the price. Question is how long they keep it this way.
Biden's recent “inflation reduction act” is good example. The act is suppose to ease inflation but in reality it has the opposite effect. Firstly，if you want to reduce inflation you have to cut government spending and print less money，but “inflation reduction act” increase spending and print more money. Secondly，this act requires all raw materials of battery used in EV to be mined and processed in the US in order to be eligible for subsidise. Since it cost a lot more to do these works in the US compare to other places，it will drive up the price of battery and EV，thus aggravate inflation not alleviate it as the act intent to achieve.
Those products made from "high resilience" supply chain is simply not competitive on global stage because of the high cost. The government either have to subsidise it in order to make it competitive，or implement protective policy to shield it from foreign competitor. Either way is the people have to pay the price. Question is how long they keep it this way.
Biden's recent “inflation reduction act” is good example. The act is suppose to ease inflation but in reality it has the opposite effect. Firstly，if you want to reduce inflation you have to cut government spending and print less money，but “inflation reduction act” increase spending and print more money. Secondly，this act requires all raw materials of battery used in EV to be mined and processed in the US in order to be eligible for subsidise. Since it cost a lot more to do these works in the US compare to other places，it will drive up the price of battery and EV，thus aggravate inflation not alleviate it as the act intent to achieve.