By Marc Levinson, Princeton University Press, pp. 544, £19.95, 2016.
In an age when many of
the world’s most entrepreneurial companies don’t own all their assets — think Airbnb, WeWork, Uber — the shipping container may seem quite a boring,
quotidian object. But this symbol of globalization teaches us useful lessons
about the changing nature of capitalism; it shows how new technology alone
cannot move markets. Challengers taking on incumbents need a heady mixture of
determination, political capital and good fortune to succeed.
The story of the
container begins with tycoon Malcolm MacLean, who in the 1960s bought cut-price
ex-Second World War vessels from the US government with the intention of
disrupting shipping. His revolutionary idea was to adapt vessels so they could
carry standardized metal boxes; a path-breaking conception in an industry that relied
on piecemeal breakbulk shipping.
Like most industrial innovation, development in the shipping industry was underwritten by government subsidies and pushed forward by international conflict. Throughout the 1960s and 1970s consecutive US administrations provided subsidies for certain cargo routes and international organizations such as the International Standards Organisation sought to set universal standards for container sizes — a feat requiring a degree of unity from shipping monoliths fighting tooth-and-nail to remain profitable. The Vietnam War was crucial for MacLean and his associates, as for the first time the US government turned to the private sector to get military resources in the right place at the right time. The security brought about by an early incarnation of the container showed governments what could be achieved through the standardization of transportation and enabled the business to set up new shipping routes to Southeast Asia.
Soon it became as cost effective to manufacturer a dress for sale in a Manhattan department store in Manila as it was to have it stitched in New York. Later, in the 1970s and 1980s countries including Singapore would build some the largest port in the world at Pasir Pajang. This was capable of serving ships that carried bigger and bigger quantities of container freight. These decades would also for the first time see major private sector investment in maritime infrastructure that until then had been the sole province of the state. This story is more than a history of a steel metal oblong because it illustrates the intimate forces at play throughout any type of global innovation. Intermodal transport changed the shape of the world and brought economies together. The process of change was spurred by MacLean but relied on permissive government policy, international coordination and spike in demand for a cheaper way to move consumer goods.