In 1934, Malcolm McLean, a North Carolina high-school graduate struggling in the Depression, spent $120 earned pumping gas to buy a used truck. In 1955, running what would become the nation's fifth largest trucking company, McLean had an idea: The process of loading ships - swarms of stevedores stowing (and often pilfering) cargo packed into ships' holds in different sizes of wooden crates - was so slow that ships often spent more time in ports than at sea. Cargo brought to docks on trucks or rail cars and sealed in standardized containers could be loaded 20 times faster per ton, and for one-20th the cost.
McLean was no Steve Jobs. He was, however, one reason your smartphone is so affordable, and one reason billions of people around the world, having been swept into the global trade system that McLean's boxes facilitate, can afford such phones.
Protruding from one of the approximately 10,000 containers here are 13-foot-tall tires ($80,000 apiece) heading for off-road mining vehicles in Australia, Brazil, and elsewhere. The tires are made in Lexington, S.C. About 200 miles inland, in the Greenville-Spartanburg area, there is a building boom ignited by the Charleston port, and now by the widening of the Panama Canal.
Since June, the canal's new lane has the ability to handle enormous ships that carry 14,000 TEUs (20-foot-equivalent units) rather than the 5,000 TEUs on ships using the canal before it was widened. The big ships bring Asian goods to America's East Coast, and take American goods abroad. More than 6 million square feet of warehouse space is being built to enlarge the Greenville-Spartanburg area's role as a distribution center for imports, and for exports from throughout America's Southeast.
Upstate South Carolina suffered when, beginning in the 1970s, Asian imports devastated the textile industry. But in that decade, Charleston's port was one reason Michelin (France) began manufacturing tires there. Since then, four other tire companies have come - Giti (Singapore), Continental (Germany), Bridgestone (Japan), and Trelleborg Wheel Systems (Sweden). South Carolina manufactures 89,000 tires a day, and exports more tires than any other state. In the 1990s, BMW built an automobile assembly plant and this March exported its 2 millionth X-model vehicle through the Port of Charleston. Without the port, Mercedes and Volvo would not be building plants in South Carolina.
Operators of the cranes that load the containers onto the ships often earn, with overtime, six-figure salaries. Every day, 3,500 trucks - 70 percent owner-operated - deliver and depart with containers. Do today's anti-trade politicians wish that South Carolina was still making towels and T-shirts for Americans rather than cars and tires (and Boeing aircraft, manufactured by more than 7,500 South Carolinians) for Americans and the world?
The University of South Carolina's Moore School of Business estimates that more than 187,000 jobs - one of every eleven South Carolina jobs - and $53 billion in economic output are directly or indirectly related to Charleston's port. It, however, needs further dredging in order to handle more of the biggest ships, which is where Congress enters the picture: Unless it authorizes the project and appropriates the federal portion of the $509 million cost to augment South Carolina's already committed $300 million, the project will be delayed a year. The deepening project is only 14 percent of the $2.2 billion South Carolina is investing in its port facilities and related access.
The biggest ships pay more than $1 million to transit the canal; if they miss their transit time, their fee is doubled. Until the port is deepened, too few can be handled here simultaneously, and they can only enter and leave the port at high tide.
There is no controversy in Congress about this project. But unless Congress acts on it before the end of the year, the deepening will not be in the president's 2018 budget and will be delayed for a year, with radiating costs - inefficiencies and lost opportunities. This a mundane matter of Congress managing its legislative traffic, moving consensus measures through deliberation to action. It will illustrate whether or not Congress can still efficiently provide public works to enhance private-sector efficiency.