Sonic Boom: Globalization at Mach Speed

Unusual book

Chapter One
Shenzhen  

The city did not exist thirty years ago, yet today has nearly 9 million residents, about the same population as the five boroughs of New York. Many of its residents were born into rural poverty-and today live a lifestyle approximately equivalent to that lived in Brooklyn. In mere decades the people of the city have transformed a rock-bound fishing village of tarpaper shacks into a leading urban center, if one whose existence is unknown to most of the world. Engineers flattened hills to make room for two dozen skyscrapers of forty-five stories or more-the tally will be larger by the time you encounter this paragraph-plus the world's ninth-tallest structure, a 1,260-foot-high office tower. The city contains numerous hospitals and power stations, plus hundreds of schools, almost all built during the lifetimes of those who use them. Crisscrossing the city are thousands of miles of roads and transit lines connecting tens of thousands of shops and cafés with more than a million dwellings, all structures that did not exist thirty years ago. Paris and London took many centuries to build; Manhattan's core was constructed in roughly one century; the glittering new cities of the American postwar imagination, Atlanta, Dallas, Denver, Los Angeles, Miami, Phoenix and Seattle, each required roughly half a century to reach their current status of impressive-when-viewed-from-orbit. This new city has outflanked them all, becoming the fastest-built great metropolis in human history.1 You're forgiven if you have never heard of Shenzhen.  

What is really impressive about Shenzhen is not its boulevards and apartment towers but its harbor. A dense tangle of docks, warehouses, quays, slips and monstrous cranes, the Port of Shenzhen has gone in a single generation from nonexistent to the world's fourth-busiest harbor. Cargoes borne by oceangoing container ships are measured in the prosaically named Twenty-foot Equivalent Units, corresponding to metal boxes the size of the trailer on a semi truck; a TEU typically holds about ten tons of finished products. In 2007, some 21 million TEUs departed from Shenzhen to the markets of the world-more cargo than moved through Los Angeles and Long Beach harbors combined, and Los Angeles and Long Beach are America's two busiest ports. Twenty-one million TEUs in a year equates to a trailerload of goods departing Shenzhen harbor every other second. Rotterdam and Hamburg required centuries to reach central positions in global commerce; Shenzhen did this in less time than one person's life span. Export totals for 2008 and 2009 are expected to be down, but the basic accomplishment won't change-Shenzhen fashioned itself into a city of global importance in a remarkably brief period. Lines of enormous cargo vessels leave Shenzhen low in the water owing to the weight of the electronics, clothing, industrial equipment, toys, furniture and other manufactured goods they are bearing to the United States, the European Union, Latin America, the Middle East and other destinations. Batteries are a common cargo because BYD, the world's second-leading manufacturer of batteries, is based in Shenzhen. By the time you read this, BYD may be the world's number-one battery maker-and a decade from now may become the world's leader in manufacturing electric cars. BYD did not even exist until 1996.  

Though the people of Shenzhen, China, do not hear it, the sound their city makes is a sonic boom. There have been booms before in various parts of the world: some brief, some long-lasting, some that were followed by busts, some that simply petered out. What is occurring now is a Sonic Boom-noisy, superfast, covering huge amounts of territory. Nothing like Shenzhen has ever happened before: there has never been a great city built so fast, nor a productive economy established from so little, nor a society transformed in such short time from isolationist and repressed to outward-focused and eager to be free. The international recession that began in 2008 has made the Sonic Boom quieter, to keep the metaphor, and is causing problems that may afflict many nations for many years. But Shenzhen represents the larger trend: growth, change and transformation at unprecedented velocity. Once the recession fades, the larger trend is likely to reassert itself.  

Suppose you live in the United States. Where in America would you go to observe for yourself the restructuring of the world-to a Wal-Mart? To an office that runs a social-networking Web site? You should go to a harbor. The Port of Long Beach, south of Los Angeles, was as recently as the 1980s a relatively sleepy place where tramp freighters debarked to carry crushed steel from abandoned cars and rusting iron from torn-down bridges to developing-world blast furnaces that would recycle what America no longer wanted. Today the Port of Long Beach has its own sprawling highway system, one that looks from the air like a complex interstate freeway, to handle the ever-rising volume of trade. In 2007, more than 2,700 large vessels arrived at Long Beach Harbor, and unloaded about 7 million truckloads' worth of goods. Oceangoing container ships spend days or weeks at anchor waiting for a space to dock; trailer trucks queue up by the hundreds. Even as the international recession slows this activity, the Port of Long Beach is much more crowded and busy than a generation ago, though it has expanded significantly and continues to expand as fast as construction crews can pour fresh concrete.  

In Brazil, in Flanders, in South Africa and Sydney and many other places, the restructuring of the world is best observed in the pace of operations at commercial seaports. The states of Pennsylvania and New Jersey are dredging the Delaware River to allow a new class of oceangoing container ships to reach Philadelphia; Shanghai is building a new port that will handle six times the volume of the already-bustling Long Beach Harbor. The harbor business is growing more rapidly than the fast-food business or the Internet advertising business, and may have more significance to the world's future. Quickly, what is Hutchinson Whampoa? The company is the world's largest operator of ports, employing more people than Honda Motors and the Intel computer-chip consortium combined. 

  As ports expand, so do ships. In 2006, the Odense Steelyard in Denmark launched the Emma Maersk, the world's longest container vessel. The Emma Maersk is longer than the nuclear supercarrier Enterprise, and was specifically built to take advantage of the long quays of Shenzhen. Numerous Emma-class trade vessels are under construction or scheduled to be laid down-many of them engineered to do nothing but transit between specific harbor pairs, such as Singapore and Rotterdam. Ship designers have for nearly a century spoken of the "Panamax," the largest vessel that can squeeze through the Panama Canal. Today they speak of the "post-Panamax," the even-larger vessels that will fit through the Panama Canal once its expansion, inspired by the sharp rise in global trade, is completed; and of the prospect of a "Kramax" ship if the Kra Canal, proposed for Thailand, is built. In 2008, the Mediterranean Shipping Company, based in landlocked Switzerland, launched the world's heaviest container ship, MSC Daniela, which weighs about a third more than the newest supercarrier, the George H. W. Bush. The vessels that really engage the attention of today's ship engineers are called "Malaccamax," meaning the maximum length and maximum draft of a ship able to traverse the Strait of Malacca. The Malaccamax vessels being designed at STX Shipbuilding in South Korea would be twice the length of the largest aircraft carrier.  

The world's surge in port activity and commercial trading vessels, assuming this continues during the Sonic Boom this book foresees, is the epitome of the mixed blessing. Rising global commerce has created jobs in China and other developing nations, lifting hundreds of millions out of poverty; shipments of affordable and increasingly impressive-quality goods produced in the developing world keep standards of living high in the United States, Japan and the European Union. But at the Port of Long Beach, three ships arrive loaded for every one that departs loaded. The United States, and European Union and Japan are buying like mad in the new globalized marketplace, but selling at a lesser pace. This has profound impact on jobs, community stability and the sense of anxious unease that characterizes much of Western life.  

Before we move to those topics, ponder what the fantastic increase in ports and ships-and telephones and airplanes and broadband lines and other aspects of the Sonic Boom-represents to the world.  

From the Industrial Revolution until the current generation, most nations threw much of their wealth and energy into building machineries for warfare. Nations eyed one another suspiciously, attempting to raise barriers to trade and intercourse, dealing with each other economically only when they believed it suited them at the expense of their partners. Now most nations put the majority of their efforts toward improving their standing in international commerce-that is, toward cooperative competition in which some members of the group may do better than others, but all members of the group become better off than if they had not participated.  

Exactly as global trade has expanded, military spending has declined. Global military expenditure peaked in 1985 at $1.5 trillion in today's dollars and has fallen since, to $1.4 trillion in 2008.2 Because the world's population rose during that period, total military spending might have been expected to rise. Instead it decreased, falling by almost 40 percent relative to population growth. In turn, the frequency and severity of worldwide combat has declined. According to the annual survey conducted by the Center for International Development and Conflict Management at the University of Maryland, the number of country-to-country...