The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger

by Marc Levinson

  Within six months of its start, Pan-Atlantic’s container service was carrying 120 containers a week between Newark and Houston. The Pan-Atlantic terminal in Newark had become a busy transshipment hub where longshoremen consolidated smaller shipments into full containers. In early 1957, after barely nine months of operation, Pan-Atlantic leased six additional acres in Newark, twelve times its original space, to store containers and chassis. After a government-sponsored study found that container shipping cost 39 percent to 74 percent less per ton than conventional shipping, the Propeller Club, the association of top shipping company executives, devoted a full day of its 1958 convention to containers. No one could doubt that conventional shipping would soon be in trouble.29

  As container traffic surged, so did Port Newark’s fortunes. New ark’s cargo tonnage doubled between 1956 and 1960 while tonnage on the New York side declined slightly, taking New Jersey’s share of total port traffic from 9 percent to 18 percent in just four years. Pan-Atlantic, renamed Sea-Land Service in 1960, accounted for more than one-third of Newark’s general cargo and 6 percent of all general cargo in the Port of New York. All of this was achieved in the once moribund domestic trade, which had now shifted almost entirely out of Manhattan.30

  A stone’s throw to the south of Sea-Land’s Newark terminal, dredges and bulldozers were beginning to shape Port Elizabeth. After two years of planning and after overcoming protests from wary local officials, the Port Authority had embarked in 1958 on a massive construction project: a 9,000-foot channel, 800 feet wide and 35 feet deep, directly opposite Port Newark; thousands of feet of wharf frontage; rail lines; and roadways up to 100 feet wide. Port Authority planners projected that Elizabeth would handle 2.5 million tons of container traffic each year, four times the level then being handled in Port Newark. The differences from New York’s dock reconstruction were plain. In a 1961 speech discussing New York City’s port redevelopment, marine and aviation commissioner O’Connor did not utter the word “container,” and the piers he was building were meant to serve vessels carrying mixed freight, passengers, and baggage. Port Elizabeth, by contrast, was designed from the start as a port for containers. Fortuitously, building on marshland required the Port Authority to start by dredging a channel, filling the wharf area with dredged spoil, and then allowing the fill to settle. Wharves and roadways did not get under construction until 1961, by which time Malcom McLean’s container concepts were even further developed. As eventually built, Port Elizabeth’s first berths each had about eighteen acres of paved area alongside, to cut down on the cost of moving containers from storage to ship. The design, the Port Authority’s magazine explained, “permits a continuous flow of trailers to shipside in ‘assembly line’ fashion.”31

  The new Sea-Land terminal at Port Elizabeth, opened in 1962, operated on a scale that was inconceivable in New York City. McLean won government permission to sail from Newark to the West Coast through the Panama Canal, and Sea-Land’s traffic soared: the Port of New York handled more domestic general cargo in 1962 than in any year since 1941. Almost all of this cargo moved across the Sea-Land pier in New Jersey. Almost none of it moved through New York City. The leisurely port calls of the early 1950s were becoming a memory. A mixed load of containers and breakbulk freight—the kind of load New York City’s new piers were built to handle—was an economic drain, because the cost of extra port time to handle noncontainerized cargo ate up the savings from containerization. With no room to store thousands of containers and chassis and no way to handle the hundreds of trucks and railcars coming to meet every ship, New York City’s docks were in no position to compete.

  For the port as a whole, containerization still remained a sideshow in 1962. Containers accounted for only 8 percent of the Port of New York’s general cargo, entirely in domestic trades. None of the port’s international traffic, which remained in Manhattan and Brooklyn, was in containers. Yet the trend was ominous. As Sea-Land expanded in the Caribbean, the island traffic that had once flowed through Bull Line’s pier in Brooklyn moved to Sea-Land’s complex in Elizabeth. New Jersey’s share of the port’s general cargo reached 12 percent in 1964.

  Despite yet more huge investments by the city, including a $25 million pier to handle high-speed ships on order by United States Lines, prospects for the city’s piers grew dimmer by the day. The Department of Marine and Aviation requested another $40 million for pier construction in 1964–65. The ILA, desperate to fend off competing claims to use of the urban shoreline, proposed that new waterfront developments in Manhattan should combine piers with apartments. But the combative O’Connor was gone, and the City Planning Commission was not afraid to take on his successor, Leo Brown, in the Wagner administration’s waning days. “We believe it is neither necessary, desirable, nor indeed feasible to ‘turn back the clock’ and attempt to rebuild two more miles of Manhattan water front for cargo piers,” the commission warned in 1964. In any case, fundamental problems had not been solved. Shipping executives continued to complain about petty corruption on the docks and about the “chaotic conditions that exist in the transfer of cargo between land and water carriers along the waterfront.” New concrete was not enough to make ship lines want to dock in New York.32

  The Port of New York Authority was expanding without cease as container shipping became an international business. By 1965, half a dozen ship lines announced plans to launch container services to Europe in 1966, and dozens of new ships were on order. There was no longer any question of handling this business in Manhattan, or even in Brooklyn. Only Port Elizabeth had the space to accommodate the surging demand for container facilities.

  The Port Authority rushed expansion at Port Elizabeth late in 1965, with five new piers and sixty-five acres of paved storage areas. At the time, no fewer than seven steamship lines expressed interest in moving across the harbor from the outmoded docks in New York City. Just ten months later, the agency moved ahead with yet another expansion, which would enable Port Elizabeth to handle twenty containerships at a time. The container tide was running so strong that the Port Authority no longer needed to pretend that Manhattan and Brooklyn would recover their places in the maritime universe. “[A]s we go through the next ten years in the Port of New York there’s no question in our minds but that a lot of the cargo will have to go from the center part of the harbor where the big city buildings are over to the Newark-Elizabeth location,” Port Authority maritime director Lyle King told a television audience. “As a matter of fact, they are talking that way now, with the plans for new container ships.” When New York officials demanded that the Port Authority build container terminals in Brooklyn and Staten Island in return for permission to erect the World Trade Center, they won only promises that the Port Authority would take a closer look. So far as New York City’s opinion-makers were concerned, it had become perfectly acceptable for the Port of New York to be located in New Jersey. “The Port Authority, a bistate body, must view New York harbor as an entity and locate its facilities on the basis of geography and economics, not politics,” intoned the New York Times.33

  The numbers tell the tale of New York’s port. In 1960, with only Sea-Land allowed to ship containers under the ILA contract, containerized freight accounted for less than 8 percent of the port’s general cargo tonnage. More than three-quarters of all general cargo still came into Brooklyn and Manhattan. In 1966, with Port Elizabeth’s first phase up and running, nearly one-third of the port’s general cargo was crossing the docks in New Jersey, and 13 percent was being shipped in containers. “The Port of New York—America’s container capital” became the Port Authority’s advertising slogan around the world. Financial interests began to speak openly of other “worthwhile activities” that could be located on Manhattan’s waterfront, such as apartment complexes and marinas. Manhattan’s docks had fallen so silent that one ILA official accused city marine and aviation commissioner Leo Brown of doing “a fine job as a parking-lot operator.”34

  New York City dockers and politicians fought
back by seeking to block the World Trade Center and picketing city hall. “If [the Port Authority] can put money into Elizabeth and Newark, why can’t they spend some in New York, to help create some permanent jobs to replace those lost by the moving of the Brooklyn Navy Yard?” asked Robert Price, deputy mayor under John V. Lindsay, in 1966. The problem, he said, was simple unfairness. “New York City handles two thirds of the deep-sea cargo and has gotten only one third of the Port Authority’s investment.” All the Port Authority could offer in response was the promise that the relatively modern Brooklyn docks would continue to handle breakbulk cargo, although, “[w]ith breakbulk operations diminishing, it is unlikely that new conventional piers will be built in the near or distant future.”35

  The Lindsay administration’s public bluster notwithstanding, officials now recognized that the Manhattan docks had no future. In 1966, parks commissioner Thomas Hoving requested permission to convert Pier 42 in Greenwich Village to recreational use; over its protestations, the Department of Marine and Aviation was forced to cede the pier’s upper story. By the following year, a dozen carriers had placed their first orders for new vessels meant to carry nothing but containers, both in their holds and on deck. No fewer than sixty-four of these gigantic ships were under construction, and the Port Authority touted a study showing that 75 percent of the Port of New York’s general cargo could move in containers. When the ILA’s Manhattan locals sought a meeting with Lindsay to demand that the city build new piers to save their jobs, even the new marine and aviation commissioner, Herbert Halberg, advised that “to build marine terminals in Manhattan, in the quantity requested, is not at present good economic planning based on the needs of the marine industry, nor good city planning.”36

  The union made a last-ditch effort to preserve the old port by hiring Vincent O’Connor, Wagner’s marine and aviation commissioner, to lobby for pier construction. O’Connor delivered a plan for a combined ship/rail/truck terminal in lower Manhattan with an airplane landing strip on the roof. Another scheme called for a “vertical pier” over the East River, using technology developed for auto mated parking garages to lift containers from shipboard to storage places high in the sky. Such fantasies were of no use. “With few exceptions, all of the major ocean carriers operating containerships at the Port of New York are berthing at Elizabeth,” the Port Authority reported in 1969. When proposals for a new passenger ship terminal reached the front burner in 1970, Lindsay decided to get the city out of the port business at long last. “Dear Austin,” he wrote Port Authority chief Tobin in language unthinkable a few years earlier, “After considering the alternatives available to us, I am convinced that the entity best able to construct and operate the terminal is the Port Authority.” The passenger terminal would eventually be built in Manhattan—but the agency, soon to be renamed the Port Authority of New York and New Jersey, had no further opposition from city government as it developed a vast new port well away from its geographic roots.37

  As containers supplanted conventional ships, New Jersey’s share of the port’s general cargo reached 63 percent in 1970. Two years later, 549,731 containers crossed the New Jersey docks. In New York City, though, only destruction was visible. Tonnage at the Port Authority’s Brooklyn docks fell 18 percent between 1965 and 1970. “The container is digging our graves and we cannot live off containers,” ILA president Thomas Gleason complained, and he was not far wrong. In 1963–64, Manhattan employers used 1.4 million days of longshore labor. Hirings slid below a million in 1967–68, breached 350,000 in 1970–71, and dropped to 127,041 in 1975- 76—a 91 percent decline in longshore employment in twelve years. Total employment at marine cargo-handling businesses in Manhattan, including office work, fell from 19,007 in 1964 to just 7,934 in 1976. The situation in Brooklyn was better thanks to the Port Authority’s investments, but not for long. Two years after Manhattan’s longshore employment began its protracted decline, Brooklyn’s followed, dropping from 2.3 million hirings in 1965–66 to 1.6 million in 1970–71 and to just 930,000 in 1975–76. By the time the Waterfront Commission closed its hiring hall at the Bush Docks in 1971, employment there and at the adjoining Brooklyn Army Terminal had fallen 78 percent in a decade. Brooklyn’s once mighty cargo-handling industry was just a shadow of its former self.38

  On the New Jersey side, meanwhile, growth exceeded all forecasts. Stevedores and ship lines were complaining of a labor short-age. Forty ship lines were operating from Port Newark and Port Elizabeth in 1973. The new port’s relentless expansion led to a 30 percent increase in hirings between 1963 and 1970, despite the efficiencies of containerization.

  By the middle of the 1970s, the New York docks were mostly a memory. Lighters carried a grand total of 129,000 tons of freight to waiting ships in 1974—less than one-tenth of the load moved in 1970, one-fiftieth as much as in 1960. Some shipping remained in Brooklyn, but Piers 6, 7, and 8, fully rebuilt in the late 1950s and known as “Little Japan” for their tenants, emptied out as five Japanese carriers moved to New Jersey. Bull Line, whose Puerto Rico business was a mainstay of the Brooklyn docks, shrank drastically before closing altogether in 1977. The four-pier complex on the Hudson River north of Fourteenth Street, reconstructed as a state-of-the-art terminal for United States Lines in 1963, stood vacant and unrentable, a monument to the city’s costly unwillingness to accept that its time as a port was over. When new tenants finally appeared, years later, the Chelsea Piers reopened for an entirely different use: recreation.39

  The decline of the docks reverberated through New York City’s economy, most strongly in the poorest neighborhoods of Brooklyn. In 1960, there were only 23 census tracts, of the 836 in the borough, in which at least 10 percent of the labor force worked in the trucking and maritime industries. On a map, these tracts form a belt parallel to the waterfront, from Atlantic Avenue in the north to Sunset Park in the south. They had much in common: large numbers of immigrants, mainly Italian; low incomes; and very low education levels. In Tract 67 in South Brooklyn, 57 percent of adults had fewer than eight years of schooling. In Tract 49 in what is now Cobble Hill, 64 percent of adults had not gone beyond the eighth grade. Tract 63 in South Brooklyn was home to 1,071 employed workers—including only four with college degrees. By 1970, transportation-industry employment had fallen sharply throughout this entire district, and the population had plummeted. The depths of the decline could be seen in a housing study conducted a few years later: in Sunset Park and Windsor Terrace, an area adjoining the docks with more than 100,000 residents, not a single privately owned housing unit was completed in 1975.40

  The revolutionary changes in cargo handling had far more dire implications for off-dock workers in transportation and distribution. Between 1964 and 1976, the number of trucking and warehousing workers rose nationally, but the number in New York fell sharply after 1970. With fewer vessels calling at New York City, fewer trucks were needed to deliver and collect cargo at the piers. Transit ware houses were abandoned or put to far less labor-intensive uses, such as parking. An entirely different pattern of goods distribution took hold. Sealed containers filled with export freight were delivered to Newark and Elizabeth, where they were stacked in the open until the vessel arrived; only small loads to be consolidated in single containers now required sorting in a warehouse. Imported containers were hauled straight from the pier to new single-story warehouses built on large plots in central New Jersey and eastern Pennsylvania. There, businesses could enjoy lower labor costs, while benefiting from the growing network of superhighways giving easy access to the port. Trucking and warehousing employment in these areas tracked national trends much more closely than in New York.

  Employment in wholesaling, traditionally one of New York’s leading industries, was hurt as well, even as it was growing strongly across the country. If employment change in Manhattan and Brooklyn had mirrored national trends in these sectors from 1964 to 1976, the two boroughs would have added 200,000 jobs, most of them suitable for manual or clerical workers. Instead, New York lost
more than 70,000 jobs in these port-related industries, while similar employment nationally rose 32 percent.

  The changes in transport costs induced by containerization hit manufacturing, too, eliminating not only factory-floor jobs but also related trucking and distribution work as plants moved out of New York. Factory employment in New York City had begun to fall in the mid-1950s, a decade before the container came into widespread use, yet the city retained a surprisingly robust factory sector into the 1960s. In 1964, New York’s five boroughs were home to just over 30,000 manufacturing establishments employing nearly 900,000 workers. Almost two-thirds of the city’s manufacturers were located in Manhattan, where the apparel and printing industries dominated. The factory sector held steady through 1967, then abruptly collapsed. Between 1967 and 1976, New York lost a fourth of its factories and one-third of its manufacturing jobs. The scope of this deindustrialization was shockingly widespread, with forty-five of forty-seven important manufacturing industries experiencing double-digit declines in employment.41

  How much of the loss of industry can be blamed on the container? There can be no definitive answer, as containerization was only one of many forces affecting manufacturers during the late 1960s and the first half of the 1970s. This period saw the completion of expressways that opened up suburban acreage to industrial development. New York’s high electricity costs pushed out some factories. The general shift of population to the South and West accelerated, leaving New York factories poorly situated to serve expanding markets. The economic downturn of the early 1970s contributed to a fall in manufacturing employment nationwide, and New York’s outmoded factories, often housed in antiquated buildings with little land on which to expand or rebuild, bore the brunt of this shrinkage.