This fireside chat recap is from Day 6 of FreightWaves Global Supply Chain Week. Day 6 focuses on global maritime logistics.
FIRESIDE CHAT TOPIC: The author of “The Box” looks at world trade today
DETAILS: Marc Levinson wrote the definitive book on the history of containerization: “The Box.” It’s about disruption, global trade and how a seemingly simple invention can revolutionize the world. Fifteen years after the book was first published, he talks about what he sees for the future of global trade.
SPEAKER: Author Marc Levinson
BIO: Levinson is an independent historian, economist and journalist whose career has centered on making complex economic issues understandable to the general public. He spent many years as an economic journalist, including stints at The Journal of Commerce, Newsweek and The Economist. He then spent a decade as an economist for J.P. Morgan Chase, developing a unique industry economics function and initiating the bank’s environmental research for stock and bond investors. He later served as senior fellow for international business at the Council on Foreign Relations and has consulted with a number of companies and government agencies.
KEY QUOTES FROM LEVINSON:
“I think a lot of firms found that they had really underestimated the risks of these long value chains. They had looked at production costs and said, ‘Hey, it’s cheaper to make things in China’ without really paying attention to whether they’d get their goods on time and whether there’d be losses from that.”
“A lot of the shift in manufacturing that has driven globalization since the late 1980s was very heavily subsidized. Shipbuilding and ship ownership were subsidized by governments around the world, which meant that freight transportation had been artificially cheap. And, of course, companies have gotten megabucks to open factories here or there. That all affects the flow of trade, so the notion that globalization simply reflects comparative advantage just really isn’t the story.”
“I think what we’re seeing now is a move toward a notion that, yes, international trade is a good thing that benefits economies and makes the world more efficient, but there can be too much of a good thing. If trade is actually driven by mispricing because of subsidies and by misjudgment of risks, then maybe there’s a little too much trade and there has to be a bit more balance. I think that’s where the consensus is heading.”