At the other end of the supply chain, builders have had to deal with surging costs and unreliable supplies that they say now add as much as $36,000 to the price of a new home.
Home prices were already on the rise because of a longstanding housing shortage — there are fewer homes for sale now than there have been in decades — and on top of lumber, things like garage doors, insulation and windows have also risen in price or are on weekslong back order as manufacturers catch up with booming demand.
“The fact is if this continues, you will see the homebuilding sector slow down and grind to a halt,” said Jerry Howard, CEO of the National Association of Homebuilders, who said housing is often a leading indicator of economic health. “This problem with lumber and other building material costs is sort of setting another potential perfect storm for housing to lead us into a recession.”
Lumber’s unprecedented price surge can be chalked up to a number of issues specific to the industry.
Construction never really recovered after the Great Recession over a decade ago, so the supply chain shrunk its capacity. Add a beetle infestation in British Columbia, European producers’ selling to China and tariffs that former President Donald Trump implemented on some Canadian wood.
Then, early in the pandemic, lumber producers cut production on what turned out to be an erroneous assumption that building would halt with the rest of the economy. Instead, consumers stuck at home went on home improvement binges, while others decided to move to new homes, because they were free to work remotely.
Image: Lumber is transported in Colorado
Jared Feltman bundles lumber on a forklift at Adams Lumber Co. in Centennial, Colo., on May 4.Hyoung Chang / Denver Post via Getty Images file
“Covid added additional fuel to an already existing inferno,” said Thom Rafferty, a commodity trader at Millbrook Lumber Inc. outside Boston. “It has nothing to do with inflation.”
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At a congressional hearing this month, Commerce Secretary Gina Raimondo said she would make lumber prices a top priority.
Builders and others want Biden to eliminate Trump’s tariff on Canadian wood, which was reduced from 20 percent to 9 percent in the final months of his presidency.
“The reality is that record high lumber prices are putting the American dream of homeownership out of reach for hundreds of thousands of potential homebuyers,” Sen. Jerry Moran, R-Kan., said on the Senate floor last week. “American homebuyers, not Canadian lumber producers, are the ones who end up paying the cost.”
For now, most economists, including those at the Federal Reserve, think the price hikes are just temporary quirks of the economy’s getting its idled engines back into gear.
Like the Great Toilet Paper Shortage of 2020, they hope it will come and go without really signifying anything greater. But no one knows for sure, and so many of the economic impacts of Covid-19 have been unpredictable.
“We’ve had a very unusual hit to our economy,” Treasury Secretary Janet Yellen told reporters at the White House this month. “Starting up an economy again, trying to get it back on track after a pandemic in which there are a lot of supply bottlenecks, is going to be, I think, a bumpy process.”
Biden is counting on a robust economic recovery to keep his popularity and his agenda alive as he tries to push through his massive infrastructure package, which would partly be paid for with tax increases. And Democrats in both houses of Congress hope a strong economy will help them hang onto their narrow majorities in next year’s elections by overcoming the historical trend in which a president’s party typically loses seats in the first midterms.
But Republicans have already sought to make hay of the rising costs to argue against Biden’s infrastructure plan.
“You’re watching food costs go up. You’re watching housing costs, lumber costs. There is inflation everywhere,” House Minority Leader Kevin McCarthy, R-Calif., said after a meeting with Biden at the White House on Wednesday. “So raising taxes would be the biggest mistake you could make.”
Meanwhile, some, like Melissa Miller, 38, of Saginaw, Michigan, already feel a pinch at the grocery store.
“The food prices are going to kill us,” she said. “It’s do or die.”
The issue has divided federal courts, with some saying that the use of the slur is so serious that even an isolated incident can establish a claim of discrimination.
By Pete Williams
The Supreme Court on Monday turned down an appeal from a former operating room aide at a Texas hospital who said his exposure to the N-word, one of the most offensive terms in the English language, created a hostile work environment.
The issue has divided the nation’s federal courts. Some have said that the use of the slur is so serious that even an isolated incident can establish a claim of discrimination. Others have said a single use of the word is a “mere utterance,” and doesn’t meet the test.
The appeal was filed by Robert Collier, who was fired after working at Parkland Memorial Hospital in Dallas from 2009 to 2016. He filed a discrimination lawsuit, saying that he and other Black employees were treated worse than others. Most notably, he said, the N-word was scratched into the wall of an elevator that he and other employees used to reach the cafeteria.
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He said the hospital management took no action after he complained about it, and eventually the word was roughly scratched out. Parkland said it investigated several complaints from Collier, but none involved racially offensive comments or graffiti.
A federal district judge tossed out his case, concluding that no reasonable jury would find the hospital’s conduct sufficiently hostile because it was not directed at him and because the effect on his work, by his own admission, was marginal. The 5th U.S. Circuit Court of Appeals affirmed the ruling.
An employer violates federal civil rights law when a work environment is so pervaded by discrimination that conditions of employment are altered. That law “is emphatically not a general civility code,” the hospital’s lawyers told the Supreme Court.
It depends on context, they said, arguing that Collier failed to prove that the graffiti interfered with his job or created an abusive work environment.
Brian Wolfman, a professor at the Georgetown University Law Center who represented Collier in his appeal to the Supreme Court, said that as long as the split among the lower court persists about the racial epithet, “Black employees in a significant swath of the country will, at a minimum, be forced to endure its prolonged and repeated use.”
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When Supreme Court Justice Brett Kavanaugh was on the District of Columbia Circuit Court of Appeals, he joined a ruling allowing a lawsuit to proceed against the federal mortgage lender Fannie Mae. The court said a single use of the N-word “might well have been sufficient to establish a hostile work environment.”
Kavanaugh, in a concurring opinion at the time, wrote, “No other word in the English language so powerfully or instantly calls to mind our country’s long and brutal struggle to overcome racism and discrimination against African-Americans.”
The NAACP Legal Defense and Education Fund urged the Supreme Court to take the case. A conclusion that words alone, even the most egregious racial epithets, can’t support a hostile work environment claim “disregards the real-world impact of racial harassment on Black employees and, as a result, diminishes workplace protections against harassment and discrimination,” the group said.
As is its normal practice, the court did not state why it rejected Collier’s appeal.
My family doesn’t understand it,” Teia Leonard said. “I’m the only woman welder they’ve ever seen.”
Four years ago, Bailey Steele was working a minimum-wage job at Taco Bell. Now, she’s a full-time welder, making more money doing something she loves.
“It’s like meditation,” Steele, 21, said. “When you put your hood down, you can just be quiet and breathe and do your thing.”