Countdown to Christmas
17 - Shipping Container
- Globalization Unleashed: The invention of the shipping container marked a seismic shift in the history of global trade. While its impact wasn’t immediate—converting ports into the hyper-efficient on-/offloading hubs of today required significant time and capital—its long-term effects have been revolutionary. Today, over 80% of global goods are transported by sea, making maritime shipping the absolute (and unrivaled) backbone of international trade.
- Standardization Unleashed: Few products have streamlined an entire industry the way the shipping container did for logistics. Why? Because it turns out that containerization is incredibly efficient. Before its advent, loading a ship cost about $5.86 per ton; the shipping container drove that down to just 16 cents per ton. That’s a staggering cost reduction of almost 98%!
- Trade & Prosperity Unleashed: All this made trading with even the most remote corners of the world so cheap that a truly global network of supply chains emerged.
Christmas Miracle
The man who boxed the world together isn’t a household name. Although he should be. Because Malcom McLean’s invention of the shipping container is one of the most consequential innovations that shaped our modern global economy. And once again, it’s a story of an unlikely practitioner. As a truck driver himself, McLean saw firsthand the inefficiencies of manual cargo loading and began wondering: what if I could simply lift and load an entire truck at once? And he didn’t stop there. He took the risk, made it happen…and revolutionized the world
In one of my favorite presentations, I like to ask: who are the fathers of global trade? As you might imagine, liberals are ready to jump on this question. They immediately throw in the names of Adam Smith or David Ricardo. But I always have to stop them right at the gate. Because (as is often the case with liberals) they forget about the real world: Smith and Ricardo’s theories are all fair and square—but they only work if trading with others doesn’t involve significant transaction costs. They need Malcolm McLean and the shipping container!
So, I usually tell liberals to think outside the box. But this Christmas, I’m asking you to think about the box itself. Because those beautiful little steel containers that deliver your favorite new gadget made our world smaller, our economies bigger, and Adam Smith’s theories finally work
