Who rules the seas? Does the power lie with the great national navies and their mighty warships? This is certainly where the United States is the undisputed big dog. America has the impressive firepower of the U.S. Navy, which also bears an even more impressive cost: $168 billion a year to keep the biggest guns in the water on standby, just in case of threat or attack.1
Or should we look to a different type of sea power, the arena of cargo ships? Their purpose is not intimidating enemy targets but actually stocking Target stores, along with every other retailer, business, and home in America. Along with all their thousands of other customers, those cargo ships just happen to deliver 80 percent of the components the U.S. Navy and the rest of the American military relies upon. The Pentagon outsources as much as everyone else. When it comes to the superpowers of global shipping, the U.S. barely ranks as a bit player.
In a concentration of power unlike any other sector of the transportation system, six steamship companies, none of them American, control more than half the goods in the world.2 Twenty global companies—most of which have joined forces in four immense ship-sharing alliances—control almost every product traded on earth.
This has been the quietest conquest and surrender in world history, one in which the entire United States happily and somewhat obliviously participated because consumers love above all else low prices at the cash register, and there is no question that globalization has delivered that part brilliantly. The miracle of modern logistics and ultra-efficient global transportation technology has made achieving those low prices possible, although beneath the gleaming tech lies the crudest of foundations. All it took was two things: divesting America of its once-mighty cargo fleets and shipyards; and outsourcing a major chunk of consumer goods manufacturing to countries with pay, benefits, environmental practices, standards of living, and working conditions that would never in a million years be tolerated on American soil. The thrill of the checkout-line bargain masks the reality that Americans pay elsewhere for those low prices in the form of shuttered U.S. factories, lower wages, a shrinking middle class, a growing inability to pay for roads and bridges, massive public subsidies of the health and environmental costs of transportation pollution, and a nation—including its armed forces—that can no longer function without massive amounts of Chinese imports shipped aboard Korean-built vessels owned and operated by foreign conglomerates.
Of the six cargo powers that control a majority of global goods movement, Denmark-based Maersk Lines is the leader, at the top in numbers of ships, in cargo capacity, in revenues, in profits, and in constructing the biggest and most advanced cargo ships in the world. Maersk (with subsidiaries in oil platforms, oil drilling, trucking, and port terminal operations) handles nearly 16 percent of the world’s cargo all on its own. That’s the equivalent of one out of every six items for sale at Walmart, making the globe-spanning Danish shipping company the undisputed world superpower of ocean commerce, based in a country with a population slightly less than the state of Maryland’s. And if that’s not enough, Maersk has partnered in a mega ship-sharing alliance with the Geneva-based Mediterranean Shipping Company—the world’s second biggest container ship line. Together the two companies’ “2M Alliance” control a combined fleet of 1,119 vessels capable of hauling 29 percent of the world’s goods.3
Not a single missile, cannon, or gun bristles from this container ship fleet. Yet, when this shipper—or any one of the other handful of powerful alliances—wants something, entire transportation systems fall over themselves to accommodate. Billion-dollar projects are launched. Port terminals are torn down and rebuilt. Freeways are expanded, railroads rerouted, trucking companies meekly accept backbreaking new costs and delays—all because the shipping lines are so good at playing country against country and state against state, always ready to move their business to a more obliging port or partner if they don’t get what they want. Is Los Angeles not giving shippers such a good deal? Well, there’s always Houston or Savannah, Mexico or Canada. It’s been that way for decades now, the hidden price tag on those inexpensive goods America once made onshore but now outsources abroad: 97 percent of our clothing, 98 percent of our shoes,4 two-thirds of our home furniture,5 most consumer electronics, toys and bikes; they’re all everyday products, and they all come from abroad. There’s a reason why the global container fleet’s cargo capacity has jumped from 11 million tons in 1980 to 169 million tons in 20106—because the growing consumer-driven economy demanded it and then became dependent upon it.
Seventy percent of America’s gross domestic product takes the form of consumer spending,7 much to the delight of those big shipping lines that connect Chinese factories to American stores and closets. The big steamship lines, both metaphorically and quite literally, have been driving the train for decades, one of the greatest forces, if not the greatest, propelling the transportation system of systems.
Still, the shipping domain is not entirely a one-way street. The shipping superpower rule book was rewritten—at least a bit—when a most unlikely port director took over the gritty docks of Los Angeles. Unlike the shipping industry insiders who usually take charge of big ports, this director was a marine biologist with a vintage pink Thunderbird, a penchant for baking, and little regard for the glass ceiling that made her one of only two female directors of the nation’s eighty-five major ports. Before she left her post in 2014, she would take on the shippers, the truckers, and every other entrenched constituency at the nation’s biggest port complex. On her watch, the dirtiest harbor with the dirtiest ships—a major source of air pollution in America’s smog capital, Southern California—would transform into an international model of greener transportation even as her port continued to be number one on the continent. She would become a charter member of an unofficial group of transportation movers and shakers, the Ladies of Logistics—the LOLs, as they call themselves. The LOLs not only buck the tide in a boys’-club industry but their influence demonstrates that, for all the impersonal immensity built into the global transportation machinery, a few brilliant or dedicated or determined individuals can have an outsized impact on how we move ourselves, our stuff, and our world. And, before her term was up, she would see the current congestion crisis coming, she would plan for it, and her legacy just might help find a cure.
“Good times” is how Geraldine Knatz recalls her eight years at the helm of one of America’s most vital transportation hubs—the most desirable and difficult job in the port business. “Not bad considering my first job here was to study life in the port waters back in the seventies—which wasn’t easy, because there was no life in the port waters back in the seventies. I suppose I’ve come full circle. And so has the port.”
Tuna, not containers—that’s what the Port of Los Angeles was most famous for back when Geraldine Knatz’s forty-year career at the twin-ports complex began. The evolution that followed is a microcosm of the transformation of the entire global supply chain as local industry dominance gave way to offshore supremacy, canned tuna included. This was long before the container revolution created a Southern California mega-port dominated by superpower shipping lines. Fishing fleets and canneries were the shot callers back then in the Los Angeles harbor—sardines in the early twentieth century, led by the French Sardine Company, then tuna once the sardines were depleted and French Sardine rebranded itself as Star-Kist.
Imports were a relatively small piece of the port puzzle even when Knatz arrived in the mid-seventies for her graduate studies in marine biology at the University of Southern California. At the time, Star-Kist and its cat food brand, 9Lives—along with Chicken of the Sea, Bumble Bee, and every other tuna enterprise in the country—operated out of Los Angeles, which had become the biggest tuna production site in the world after World War II. The fishing fleet and canneries employing thousands occupied the wharf space now filled by container ships and terminals. Just by the smell on the morning breeze, the locals in San Pedro overlooking the harbor could tell if it was a human food day or a pet food day. That distinctive aroma of an open sack of dry dog or cat food would permeate the waterfront on pet days, distinct from the briny, heady fish scent of regular tuna canning. And no matter the day, human or pet, the canneries dumped their waste from fishing, cooking, and canning into the harbor as they had done for more than half a century. It was into this miasma that young Geraldine and her wetsuit were quite literally thrown, as the port launched a belated effort to cleanse its polluted waters.
Paddling around in cannery waste had not been her dream job. She grew up watching the prime-time TV specials starring Jacques Cousteau aboard his intrepid research vessel, the Calypso, as he played with the dolphins, spoke rhapsodically in his melodic French accent of the shy intelligence of the gentle octopus, and advocated for ocean preservation. The scuba-diving adventurer’s broadcasts inspired thousands of baby boomers to pursue a career in the ocean sciences, Knatz among them. She had grown up in the northern New Jersey township of Wayne, where her father worked as a factory die cutter and her mother kept the house, both of them forced by the Great Depression to take jobs as teenagers rather than finish high school. They maintained a hard-times work ethic all their lives, requiring their daughter to get a job and start paying room and board at age sixteen in addition to her high school studies. She didn’t dare complain, as she had been given a better deal than her brother, who had to start earning his keep at age fourteen. But it did drive her to covet a career she could love rather than merely endure.
In her spare time, young Geraldine collected pond samples while walking home from school or work, using the microscope her brother had received one Christmas to identify the protozoans within. While at college, she landed a research internship studying port pollution near Fort Hancock, New Jersey. The National Oceanic and Atmospheric Administration (NOAA) scientists working on the project at the army base took pity on her when she confessed that, on the way there, she had to pretend she dropped her quarter on the ground at every other toll both on the Garden State Parkway. That way she would be waved through without paying, a tactic she adopted because she could afford to pay only every other quarter. Her supervisors ultimately let her move into a disused old barracks at the base to avoid the tolls, then finally gave her a paid position. At night she used to lie on the beach and watch the big break-bulk cargo ships go around the Sandy Hook point en route from New York Harbor. It was the beginning of her fascination with cargo ships and ports.
After graduating from Rutgers University and winning admission to USC’s postgraduate program, she drove to California and found a little apartment in the Silver Lake area of town, not far from Dodger Stadium—a fashionable, eclectic neighborhood now, unfashionable and very affordable back then. She left for class or the harbor early every morning, exchanging greetings with her elderly neighbor, Maria, who spoke to her with a thick Russian accent. Only after Maria died did Knatz learn she had been living next door to Rasputin’s daughter. The unusual and the strange often seem to follow in Geraldine Knatz’s wake. (The root meaning of her Germanic surname, she says, is “troublemaker.”) One of her employers, she recalls, made the entire port staff undergo handwriting analysis to reveal their personality traits, an expression of this particular port director’s fondness for fringe science and psychic phenomenon. She thought it was a bit weird at the time, but as she was promoted immediately after the analysis came back, she never complained. That director, a local businessman whose expertise was not in ports but in amusement parks and hotels, left after a mere year in office. The most important legacy of his tenure would turn out to be Knatz’s promotion.
Knatz began her long career at the port as a student researcher attached to a water-quality project funded by the tuna canneries. The canneries hoped that science could show that their dumping of fish waste into the harbor was actually a beneficial “bio-enhancement.” It wasn’t. The harbor had been stripped of life and the oxygen that supports life, and the canneries were a big part of the problem.
“We’d go out and if we found a little bit of oxygen in the water we’d celebrate,” Knatz recalls. “Back then, there was basically nothing living there. The water was dead.”
But it was not irredeemable. Knatz spent the next three years researching and diving with USC as she earned her master’s degree, then took a job as an environmental specialist at the Port of Los Angeles while pursuing her doctorate. Her work then focused primarily on improving the abysmal water quality in the harbor. This was not altruism or good corporate citizenship at work. Air pollution, water pollution, and extinction threats to such signature species as the national symbol, the bald eagle, had become so grave that a Democratic Congress passed and Republican president Richard Nixon signed a series of sweeping, powerful, and publicly popular bipartisan environmental laws in this era, among them the Clean Water Act of 1972. Under the law, canneries had to start treating their waste and dispose of it properly. Leaking oil and fuel infrastructure had to be repaired or replaced throughout the port. One of Knatz’s first tasks was to dive the port to assess the damage caused by leaking oil after a docked tanker ship exploded. She dove with a bunch of white sticks in hand, measuring the toxic gunk that had accumulated on the harbor bottom by plunging the rods into the sea bed like dipsticks into a car engine.
It would take more than a decade’s work to show substantial improvements in the port waters, to nurture kelp beds transplanted shoot by shoot and rock by rock (the underwater plants cling to rocks, not sand), and let nature work its slow magic. Slowly, the harbor waters once again became infused with life-giving oxygen and the ecosystem that had always belonged there revived. Life returned to the harbor, not least because the commercial tuna industry collapsed. Overfishing, the lure of cheap labor in American Samoa and Asia, and the ebb and flow of the new global economy led the big tuna brands to flee one by one, with all gone by the end of the eighties except for Chicken of the Sea, which hung on until 2001, then closed what was the last tuna cannery in the continental U.S. Thailand-based Thai Union Frozen Products now owns Chicken of the Sea while British private equity firm Lion Capital LLP owns the Bumble Bee tuna brand—yet more once-proud domestic products outsourced, with many more thousands of miles added to America’s cupboards in the process. On average, each American household consumes nineteen cans of tuna a year.8
Huge export container terminals eventually rose where the canneries once stood, but smaller-scale commercial fishing enterprises flourished anew around the harbor as water quality improved and overfishing ended. The work by Knatz and her colleagues exceeded all expectations.
But its success notwithstanding, her environmental work offered Knatz little opportunity for career advancement. The port brass perceived her department less as an asset and more as a hindrance to the port’s main mission: shipping, commerce, and growth. It was her job to question projects and their impact on the environment, and to suggest ways of reducing the harm. The projects ports like to do most—dredging, filling, and creating more capacity for exhaust-spewing ships, cranes, and trucks—always have a negative impact. And reducing those negatives usually imposes additional cost. Never mind that Knatz’s work insulated the port from even more costly lawsuits and delays.
She would have happily moved into a different department at the port with more responsibility, earnings potential, and advancement possibilities, but Knatz soon learned there were few opportunities then for women in the core lines of business at the port, where the workforce was overwhelmingly male. She felt the prevailing attitude back then was that she was already fortunate to be the only female in a “nontraditional” job at the port, meaning she didn’t work a clerical, secretarial, personnel, or public relations position. When she applied for other jobs—in marketing, for example—she recalls being turned down because, a manager explained, she couldn’t play golf with “the guys.” Or because the wives of the men on the staff wouldn’t like it if she went with them on foreign trade missions. Some of the cultures they had to visit abroad to drum up business for the port would think she was brought along only “for sport,” one supervisor suggested, which confused Knatz until she realized he was referring to sex. In another time or with another employee, this could have been the stuff of very costly lawsuits, but Knatz recalls never considering such a move. “I’m more of a nose-to-the-grindstone type of person, and figure if I let the work speak for itself, I’ll prevail.”
In 1981, Knatz accepted an offer to run the environmental department at the rival Port of Long Beach. Although there is of necessity some collegiality and partnership on broad issues and projects that affect two gigantic ports that happened to share a single harbor, they have for the most part been locked in fierce competition for customers ever since the late 1920s. That’s when the discovery of copious oil reserves beneath the previously ritzy Long Beach neighborhood of Signal Hill financed the creation of a second commercial port in San Pedro Bay, luring both Ford and Procter & Gamble to build massive factories nearby. When Knatz came over to Long Beach six decades later, the Long Beach port was considering a range of large building and improvement projects to accommodate the shift to container ships and the approaching tsunami of Asian import goods. Knatz’s challenge was to deal with the environmental impact of those projects, a seemingly impossible task. The 3,000-acre port eventually would be jammed with ten mammoth piers, eighty deep water berths, dozens of miles of on-dock railroad track, and twenty-two cargo terminals—six of them sprawling container yards, six for bulk commodities (salt, gypsum, cement, petroleum coke), five for petroleum and other bulk liquids, and five break bulk terminals for such cargo as cars, lumber, steel, aluminum, and iron ore. There’s no way to accommodate all that without environmental harm, and no room to spare to set aside sufficient wildlife preserves, parks, or buffer zones that might, as the law demands, “mitigate” the damage to the environment.
The difficulty of striking an agreeable balance between profit, planet, human health, and technical feasibility is one reason why so many big, landscape-altering projects—particularly huge, emission-spewing transportation projects—get held up for years and so often end up in court. State and federal laws unambiguously require mitigation, but the question of how much is always contentious, with project boosters vying to do the least possible, and communities that might suffer from an expanded port, freight yard, or freeway pushing for the most possible. With the port caught in the middle, Knatz hit on what was then a daring plan, although it’s now accepted practice: she wanted to do environmental mitigation outside the port for work inside the port. She began using port funds to restore nearby Pacific coast wetlands, build public parks and beach facilities for communities near the port, and clean up landscapes and habitats near but not in the port that had far higher ecological value than the waters of a bustling commercial harbor.
The regulatory bureaucracy initially bristled at the unorthodox approach, but local communities loved it and began lining up to pitch their own projects as candidates. The tide turned completely in favor of this “outside-the-docks” approach when both Long Beach and Los Angeles ports agreed to provide a combined $60 million for the restoration of the critical Bolsa Chica wetlands twenty miles south of the harbor. This important breeding ground for migratory birds and other marine species had been badly damaged by oil drilling, roadbuilding, and encroaching development. Today it’s an ecological preserve and permanent conservancy—a slice of nature initially undone by the rapidly expanding transportation system, only to be brought back from near destruction by even more transportation expansion at the ports.
In 1988, Knatz left her job running the Long Beach port’s environmental department to become director of planning instead, which finally put her where she wanted to be: in the thick of the ports’ core business. There she would push through a long list of expansion projects, most notably a $2.4 billion mega-project known as the Alameda Corridor. This twenty-mile cargo expressway for trains links the twin ports to the transcontinental rail lines that pass through downtown Los Angeles. By the time it was done, the Alameda Corridor would rank among the biggest and most successful public works projects ever undertaken in the U.S., a public-private partnership that, unlike most mega-projects in recent years, finished on time and on budget.9 It is the envy of other American cities that lack such a connector between port and transcontinental rail system. Chief among them is New York City, which is number one in the U.S. when it comes to dependence on trucks for goods movement, and so suffers from unusually intense diesel truck emissions. Of the more than 400 million tons of freight that move through New York annually, 90 percent moves by truck.10 Nationally, trucks move about 70 percent of freight.11
The Alameda Corridor project solved that problem on the West Coast. It came about because the economic boon of rapid growth in container traffic and imports spawned a Newtonian reaction, equal and opposite, bringing a swarm of trucks that boosted congestion and smog on the major streets and highways connecting the port to the rest of the world. Traffic engineers and local planners, who predicted worse ahead as the port continued to grow, believed creating an efficient method of moving more cargo by train instead of by truck offered a solution.
The key word here was “efficient,” for trains were nothing new at the port. There had been a rail connection between downtown and the port in place for more than a century—indeed, for almost as long as Los Angeles had anything more than mudflats and a few nailed boards to call a port. Knatz, so fascinated by the history of the port that she would write numerous articles and two books on some of the more unusual aspects of its past, dug into this end of the story gleefully. A visionary entrepreneur and self-made millionaire by the name of Phineas Banning built the first railroad between the port and the warehouse districts of downtown Los Angeles all the way back in 1869. Banning also masterminded the first dredging and wharf construction in San Pedro Bay. Previously, ships had to anchor off the coast and shuttle goods ashore on small boats. At the time, Banning’s railroad traversed open coastal country, sparsely settled and otherwise difficult to cross. His Los Angeles & San Pedro Railroad represented a huge transportation advance from wagons banging over rutted roads and range. The new transportation technology began the transformation of a muddy backwater port into a thriving West Coast economic engine.
A few years later, the Southern Pacific Railroad bullied itself into ownership of Banning’s achievement, as its monopolist tycoon leader, Collis P. Huntington, essentially extorted its sale in exchange for connecting the city to the transcontinental railroad line he was building. Huntington also demanded the city pay his railroad the then princely sum of $600,000 ($11.5 million in 2014 dollars) as well as gift Southern Pacific with sixty acres of choice downtown LA real estate. Otherwise, he vowed the Southern Pacific, originating in San Francisco and moving south down the coast before chugging eastward, would bypass Los Angeles entirely. And this pre-Hollywood Los Angeles of the 1870s, a mere village of 5,000 or so, could simply wither and die without a rail connection. The big rail lines were the nineteenth-century lifeblood of commerce, travel, and migration, as the ruthless Huntington knew all too well. Capitulation by the city and Banning was inevitable, but that was just the start of Huntington’s machinations. Next he launched a campaign to strangle the very port in San Pedro harbor he was supposed to be serving by imposing horrifically high freight rates on the railroad Banning built. Under the new rate schedule, it often cost more to move goods the twenty miles between downtown and the port than it cost to ship the same goods to Hong Kong. Huntington wanted to force customers to take their import and export business to his own pet port project in the beach town of Santa Monica thirty miles up the coast, where he had had constructed what was then the longest wharf in the world. That’s where he wanted the leading port of the West Coast to take root: on his land, his wharf, his town. His goal was control in Southern California of nothing less than the two dominant transportation modes of the day, marine and rail, thereby owning Los Angeles’s future all by himself.
Huntington’s bold bid to create what would have become the greatest trade and transport monopoly in U.S. history failed after a years-long battle known as the “Free Port Fight,” but only after his foes in Congress just barely thwarted his clout and money. They succeeded in designating San Pedro Bay over Santa Monica as the site for an all-important breakwater construction project by the Army Corps of Engineers, who were charged with creating Southern California’s first protected calm-water harbor. Construction of that breakwater was such a big deal at the time that a special wire was set up to connect the White House directly to the San Pedro waterfront so that President McKinley could push an electric button on April 26, 1899, signaling the construction crews to commence work. Boulders were carried from inland quarries by steam locomotives pulling long lines of flat cars piled high with the rock needed to build the massive breakwater, a dike to calm the tides and protect docked vessels from storms and high seas. Like so many other vital pieces of the transportation system of systems, the design and location of the future hub of commerce on the West Coast—and the very existence of Los Angeles as a major city—rested not on some grand municipal study, engineering analysis, or the project’s objective merit. The biggest port on the continent owes its existence to the vagaries inherent in a few powerful individuals’ struggle for wealth, dominance, and the big win, along with a president’s giddy desire to throw the switch on what was at that moment the nation’s largest public works project. Had the question been limited to simply choosing the most naturally ideal place for a major Southern California port, neither location in Los Angeles would have been chosen. If geographic merit alone were the only consideration, McKinley’s magical button would have connected to San Diego and that city, rather than Los Angeles, would have grown up to be the future hub of West Coast cargo, commerce, and population growth. Whether it’s the selection of a port location, or a twenty-six-lane freeway expansion in Texas that makes traffic worse, or LA’s decision after World War II to dismantle the most extensive light rail and streetcar system in the country (then, a half century later, spend billions and decades trying to undo that folly), America’s transportation future owes as much to greed, gamesmanship, and hubris as sensible design. Perhaps more.
When the dust settled in the war of the would-be ports, Los Angeles stood connected to the Eastern U.S. and the rest of the world by rail and sea, and the village of 5,000 of the 1870s grew to a city of 100,000 by 1900. Just ten years later it would be home to 300,000. The rural outskirts between downtown LA and the port began to evolve into the dense checkerboard of communities, industry, immense rail yards, and the grid of streets and roads that it is today. But during this urbanization process, what had been a breakthrough railroad route to the port through the hinterland became an antiquated roadblock and a continual frustration for both shippers and drivers. Motorists found themselves stacked up at railroad crossings twenty cars deep while waiting for excruciatingly long and slow freight trains to pass. By the 1980s, Banning’s old railroad right of way consisted of four low-speed branch lines owned by the Southern Pacific Railroad with more than two hundred street-level crossings. That’s an average of ten intersections of car and train traffic every mile. The route had become such a jigsaw puzzle that freight trains rarely averaged speeds of more than 10 miles an hour, 15 on a very good day. On bad days, the twenty-mile trip from port to downtown took four hours. A bicycle rider, even a jogger, could beat that time. These trains ran up to 6,000 feet in length—a mile and an eighth—which meant drivers trapped at those crossings typically waited twenty to thirty minutes each time a train passed. Those trains ran continuously throughout the day. This was a mess, a system pieced together across more than a century, becoming increasingly dysfunctional as the city grew up around it. The rail line to the port was not designed for modern traffic, much less the high risk of death and destruction whenever human drivers are asked to sit patiently for twenty minutes with nothing more than flashing lights barring them from crossing the tracks.12
Solving this traffic miasma with a single rail mega-corridor that darts above or below street traffic—an expressway for trains—may sound obvious in retrospect, but formidable barriers deterred it for many years. There was cost to consider, and property rights, community fears, the engineering challenge of building an immense trench in a dense urban area, and the sheer “It’s the way it’s always been” inertia that keeps bad transportation systems in place for decades. The railroad had lucrative monopoly control of the right of way and no incentive to ease the pain to the populace or the rest of the goods movement system by investing billions—which is why the idea originated in government, at a regional planning agency where a transportation visionary by the name of Gill Hicks worked.
One of Knatz’s first big hires was Hicks, whom Knatz stole away to spearhead the project. The port could do what the private sector could not accomplish on its own. Although it’s a publicly owned asset, the Long Beach port receives no funds from the city but runs off its earnings, where it acts as landlord to all the businesses that operate there. Every decision has to make business sense at the port, and investing in a better rail connection—though a financial nonstarter for Southern Pacific—would be a customer magnet for the port, drawing cargo with the promise of far faster goods movement. Hicks would lead the project and go on to be the director of the corridor program after it opened for business as its own quasi-public agency. Knatz, meanwhile, partnered with her old employer, the Port of Los Angeles, becoming the chief negotiator for acquiring the Southern Pacific rail lines, stations, yards, and rights of way. This ended up being a hard-fought $235 million deal for control of the corridor that the bullying Collis Huntington got for free through threats and intimidation. Still, the deal transformed goods movement at both ports while relieving one of the worst traffic-jam generators on that end of Los Angeles.
Completed in 2002, the Alameda Corridor project isolated the rail lines from street traffic with a series of bridges, underpasses, overpasses, and the centerpiece of the project, a ten-mile trench three stories deep and fifty feet wide, a man-made canyon for trains. This enabled freight trains to zip downtown from the port in a half hour or less instead of the two hours plus it used to take, without slowing car traffic a single minute. Some of the trains run nearly two miles long, but there are no flashing lights and no crossing gates. On average, each train hauling cargo out of the port takes three hundred trucks off the road, and there are nearly fifty such trains a day. That’s 15,000 truck trips a day removed from crowded freeways and smoggy air.13 About a third of the goods coming into the twin ports now moves out through the Alameda Corridor rail system. Without it, the growth of cargo flowing into the port would have had a crippling impact on freeway traffic and smog in the region long ago.
In 1999, Knatz was elevated from planning director to the number two job at the Port of Long Beach: managing director. She thought she might be in line for the top job eventually, but when a leadership change left her future uncertain, Knatz sought to return to her old employer, the Port of Los Angeles, when a new mayoral administration was voted in and the top job at the port opened up. The application process devolved into the sort of odd turn of events that seems to crop up wherever Knatz is involved. It started when she received a form-letter rejection in the opening round of the port job search. This seemed odd, given her long career and relationships on both sides of the harbor, not to mention her position as second in command at America’s number two port. But she was prepared to shrug it off and move on. Her husband, however, insisted that the letter had to be a mistake. Knatz loved him for his faith in her, but she said there was no way the top headhunting firm hired to recruit a new port director would be so bumbling. She couldn’t call back and say, Gee, did you really mean to reject me? How foolish would that look? When he wouldn’t relent, Knatz finally placated her husband by reluctantly placing the call, only to be flabbergasted when, after a long silence, the headhunter exclaimed, “We sent you the wrong letter!” Then Knatz learned she was already scheduled for an interview at an airport hotel that Saturday evening—the last one scheduled.
When she arrived for the one-on-one, however, the apparently exhausted headhunter dozed off in the middle of Knatz’s interview. Mortified, she returned home and complained, “There I was at a hotel on Saturday night with a man who’s not my husband. And he falls asleep!”
The ridiculous interview, like her errant rejection letter, turned out to be an unreliable indicator of Knatz’s job prospects. She soon learned she had made it to the next round, then on to a meeting with the mayor. The next thing she knew, Knatz had been tapped to run the most important port in America.
It turns out her background as a biologist and environmentalist left her uniquely qualified for the times. The port complex was under siege as the worst air polluter in California. Virtually every major project to improve the LA docks, the terminals, and the surrounding infrastructure sat frozen by lawsuits and protests. Her predecessor had worked for two decades for steamship line giant Maersk before coming to lead the port, an insider status perfectly suited to dealing with the shipping industry. But he was perceived as insensitive to the concerns of the surrounding community by such organizations as the Natural Resources Defense Council, which had targeted the port as a leading threat to health and environment. Knatz, who had come to the port as the scientist-outsider so many years before, was uniquely positioned to settle the skirmishes with environmentalists and surrounding communities and get the port modernization back on track before overload paralyzed operations. The new mayor made the new port director’s mission very clear, she’d later say: Fix it.
Knatz, in turn, told her staff they would be adopting a new in-house motto to describe goals to simultaneously grow the port with massive new infrastructure while radically cutting pollution at the same time: “It’s impossible. It’s difficult. It’s done.” This had been the progression on the Alameda Corridor project, she said, and the same approach would fix the port. At first these apparently conflicting goals would seem impossible, she said. Then achieving them would seem very, very difficult.
“And then we’ll be done.”
The environmentalists’ claims were not wrong. The port had been identified by state scientists as the major source of air pollution in the region. The ships were a big part of the problem.
There are about 6,000 container ships in the world (out of a total of 90,000 cargo vessels of all types). These behemoths move 120 million container-loads a year, worth $4 trillion.14 They are also prodigious consumers of one of the dirtiest fossil fuels on the planet. The growth of maritime shipping and the giant container ship has powered an unprecedented explosion in world trade, but also an environmental disaster.
Bunker fuel, it’s called: the cheapest, dirtiest form in common use is up to 1,800 times more polluting than the diesel fuel used in buses and big rigs,15 and little more than a waste product left over after everything else useful is extracted from crude oil. It has the consistency of asphalt; a person can walk on it when it’s cool. The big cargo ships burn so much bunker fuel that they don’t measure consumption in gallons but in metric tons per hour, with the really big ships consuming two hundred to four hundred tons a day. One large container ship burning this type of fuel spews out more sulfur and nitrogen oxides—the precursors of smog and particulate pollution, as well as a major contributor to the ocean acidification that threatens fisheries and coral reefs—than 500,000 big-rig trucks or roughly 7.5 million passenger cars.16 That means just 160 of the 6,000 such mega-ships in service today pump out the same amount of these pollutants as all the cars in the world. New regulations that took effect in 2015 compel shippers to use a cleaner, less polluting type of bunker fuel when they cross the two-hundred-mile limit at the edge of U.S. waters, which has reduced ship emissions close to shore. But the cleaner bunker fuel is more expensive, and so many shippers hover just outside the limit when waiting for a berth opening at their next port of call, then race in at the last possible minute, thereby maximizing their use of the dirtiest, cheapest fuel.
The cargo fleet is also a prodigious source of carbon emissions—about 2 to 3 percent of the global total.17 Although that’s only between a third and a fifth of the global-warming gases emitted by the world’s cars,18 it’s still a big greenhouse gas footprint for such a relatively small number of vessels. If the shipping industry were a country, it would be in the top ten drivers of climate change, and its billion tons of carbon dioxide and equivalents put it ahead of Germany, the world’s fourth largest economy. At current rates of growth, the shipping industry that hauls 90 percent of the world’s goods will be two and a half times its current size by 2050; absent a serious effort to become more energy efficient, it could be generating a staggering 18 percent of global greenhouse gases by then.19
Through a very deceptive accounting loophole, none of these big ship emissions “belong” to any one country. They happen in international waters for the most part, and so for the purpose of calculating the greenhouse gas emissions of nations, they simply don’t exist—on paper. They very much exist in terms of their impact on climate, oceans, and health. As the world’s biggest consumer, America is the beneficiary of a substantial portion of container shipping, as well as the manufacturing of the products on board. The United States is the per capita world leader in global greenhouse gas emissions, and second only to China in absolute volume of emissions. Much has been made in the U.S. Congress and press of China’s overall lead in greenhouse gas emissions, but about half of the growth in Chinese carbon since 1990 is the result of offshoring and globalization—China’s explosive growth as a manufacturer of products for export, with the U.S. the biggest customer. Those emissions, in other words, are as much ours as China’s. We haven’t outsourced just jobs and manufacturing; we’ve outsourced our carbon. Even with that accounting trick making the U.S. appear greener than it really is, the average American produces about twice the carbon emissions of the average European, and 3.5 times the average Chinese citizen.
When these ships approach the port and dock, the practice in the past was to keep the engines running as they burn through tons of bunker fuel to maintain power aboard the ship. The bunker fuel emissions made working at the port unhealthy and polluted neighboring communities.
Within five years of Knatz’s arrival, pollution at the port dropped so dramatically that even the most ardent critics were dishing out praise: emissions, particularly those related to diesel and ship engine exhaust, were down as much as 76 percent even as container traffic increased.20
Several big changes in the handling of ships and cargo led to this startling turnaround, which initially made the twin ports of LA and Long Beach outliers, then world leaders in a growing green ports movement.
The Port of Los Angeles became the first U.S. commercial port to install cold ironing for docked container vessels. “Cold ironing” is the industry term for the use of giant power plugs to connect ships to the shoreside electrical grid while docked. This allows them to shut down their engines (thus the “cold” part of the term, which harkens back to the days of red-hot coal-fired engines) and still keep their essential electrical and refrigeration systems operating without spewing fumes and toxins.
Work on the very first shore power plugs in LA started before Knatz’s tenure began, as part of a settlement of a massive lawsuit filed by the Natural Resources Defense Council that had halted construction at the port for years. But the new port director turned that grudging acquiescence by a predecessor into a port-wide asset, touting zero-emissions ship power as a solution to the single biggest pollution source on the coast. The shipping industry initially objected to the cost of the new shipboard equipment, but Knatz argued that they’d benefit from a combination of fuel savings and community goodwill—and the likelihood that an investment in clean tech and good corporate citizenship on this point could make future projects the shipping industry desired more palatable to the public.
The Port of Long Beach undertook similar reforms. By the end of 2014, half the cargo ship calls at the ports were supposed to be with engines off and shore-based power engaged. That goal was not quite achieved—at Los Angeles, it was closer to 35 percent, as the shipping lines stalled on installing the necessary equipment. Even so, the pollution reductions from ship exhausts were dramatically reduced, exceeding goals that were not required for another three years.21
Other U.S ports at first tried to capitalize by positioning themselves as cheaper, easier, and less regulated alternatives, and a few shippers did shift some cargo. But even with the new green requirements, few ports in the U.S. could match LA or Long Beach on the time and costs of shipping. Economics and geography ensure this: to ship a container from Asia to America via Los Angeles or Long Beach takes twelve days on average at a cost of about $1,800. It’s another five days’ transit time by rail or truck to Chicago or the East Coast, a total transit time of seventeen days. By comparison, bypassing the West Coast in favor of an all-water journey from Asia to the East Coast via the Panama Canal takes twenty-seven days at an average cost of $4,200 per container, not counting the time and expense of shipping from the port to its final destination. Shipping via the Suez Canal takes even longer: thirty-seven days.22 As long as the twin ports kept modernizing and preparing for larger ships and container loads, the shipping lines would not abandon them over a green initiative that other ports around the world had begun to copy anyway.
Under Knatz’s regime, the Port of Los Angeles spent an average of a million dollars a day on maintenance, modernization, and upgrades. She likens a port to a bridge, like the George Washington or the Golden Gate, which must be painted regularly to protect the metal structures from corrosion but which are so huge and take so long to finish that, once a paint job is completed, it must start again almost immediately at the other end of the span. As part of this effort at upkeep, Knatz gradually swapped out old and dirty diesel-powered dockside machinery for handling and moving cargo in favor of motors that rely on natural gas, batteries, or other lower-emissions technology.
The third and most contentious measure the twin ports initiated during Knatz’s time in office was a clean-trucks program that phased out older, heavily polluting big rigs that served the ports as drayage vehicles. Dray trucks—the term dates back to horse-drawn, open-sided carts for hauling goods short distances—fetch containers at the port and move them to nearby warehouses, rail yards, and other intermodal terminals, where the container goods are unpacked, sorted, repacked, and handed over to longer-range shippers for transport to the actual cargo owners. Drayage is an essential but troubled leg in the consumer supply chain, with the drivers often paid and treated poorly, working as contractors rather than employees, many of them owner-operators driving older—and dirtier—vehicles.
Trucking and retail trade associations tried to block the clean-trucks program, but their lobbying and lawsuits failed to halt the phasing out of old dirty trucks. By 2012, no trucks from before the 2007 model year could operate at the port, and the diesel emissions throughout the area measurably lessened.
Other players in the port ecosystem were more supportive than the drayage companies and truckers of the changes. The shipping lines, whose single greatest expense is fuel, were looking for new efficiencies anyway, and cold-ironing could be a money saver for them in the long term. The terminal operators who receive the goods coming off the ships were sick of lawsuits over environmental concerns halting their expansion plans and saw the green-ports initiative as a means of relieving the bottleneck—an investment that would pay dividends by allaying community concerns and allowing more growth. The longshoremen’s union and local communities were pleased because they saw direct improvements in working and living conditions. Neighborhoods near the ports worried less about respiratory disease and elevated rates of childhood asthma. Environmental critics praised the transformation. Dockworkers experienced the greatest relief. Many had spent their careers working in choking fumes, their clothes black with diesel particulate at the end of the day. Crane operators, hovering over the ship’s exhaust stacks as they lifted out cargo, had inhaled the stuff all day long. “They want to earn a good living,” the union president told Knatz at the outset of the green program. “They do not want to pay with their lives for a stronger economy.”
There were concerns about the cost of going green in the short term, but these were balanced against long-term gains in fuel savings and lower maintenance costs. Instead of driving business off to other ports, as was initially feared might occur, the green programs won international praise and inspired similar reforms worldwide.
There were other threats to the ports and, by extension, the whole goods-movement system, against which Knatz knew any tussles over the green-ports initiatives paled by comparison. The port and its transportation connections to the rest of the world were facing overload with a public that neither understood nor felt sympathy for the port’s needs. Modern Los Angeles has always styled itself as the headquarters for beaches, surfing, movies, and television—the capital of car culture, the center of sprawl, the home of Hollywood. But the host city to the biggest seaport complex on the continent, the spout through which so much of the consumer economy pours, has never viewed itself as a port town. In short, Knatz had to get the message out: another project of the magnitude of the Alameda Corridor was needed—and probably more than one—and for that she needed allies. That’s when she turned to the LOLs.
The fifty or so members of the Ladies of Logistics call themselves a social group. They’re women at work in the male-dominated logistics world who get together for power walks and potlucks and Geraldine Knatz’s famous bake-offs—and for networking.
Transportation, so often referred to as a “system,” is dizzyingly fragmented. Its leaders, workers, and innovators occupy their own silos, laying their plans and setting them in motion for bigger vessels or new distribution centers or expanded freight yards all according to their own individual needs, often with little or no input or consideration of other elements in the supply chain. But when a group of LOLs gathers, they bring together top transportation executives across all modes and industries: rails, roads, ships, retail, academia, real estate. Among them are developers and owners of warehouses and distribution centers; members of the California Transportation Commission and the National Freight Advisory Committee; the vice president of the Pacific Merchant Shipping Association; a leader from the longshoremen’s union; the head of the Coast Guard’s Los Angeles command; leaders of chambers of commerce; and other major players in ports and government.
When the vice president for government affairs at the Burlington Northern & Santa Fe Railway faced protests and lawsuits against a proposed new freight yard, dubbed the Southern California International Gateway, her fellow LOLs—Knatz and Elizabeth Warren, who leads a harbor business association called FuturePorts—spoke out publicly to support the plan. It would be a benefit to the entire regional transportation system, these Ladies of Logistics argued to a skeptical public, easing congestion by replacing trucks on the freeway with boxcars on rails, lowering pollution, making goods movement—and therefore the goods themselves—cheaper for all. Later, when a port terminal expansion plan Knatz coveted aroused neighborhood concerns about traffic and property values, the LOLs from local universities appeared with data showing economic growth and jobs in the community tied directly to growth at the port.
Fran Inman, senior vice president of Majestic Realty and appointee to the National Freight Advisory Committee, brings to Washington the views of all the LOLs. Her own perspective is unique: Inman’s company is the largest private industrial real estate owner in the U.S. and warehouse landlord to such diverse tenants as Amazon, General Electric, In-N-Out Burger, Walmart, and Crayola. She found that many people are fond of saying the transportation system is broken, but the real problem is that it’s invisible. “When it’s working, which is most of the time, no one pays attention,” she complained at one LOLs event. “People tune in only when something’s not working.”
As she became immersed in transportation policy, Inman was flabbergasted to learn that America has no national goods-movement strategy. Knatz told her other countries are surging ahead of the U.S. on this score, particularly in marketing their seaports as alternatives to Los Angeles and Long Beach. “Canada has an entire national freight strategy worked out,” she said. “And their strategy is to steal my business.”
The LOLs cut across all parts of the transportation system, and because many of them have projects that require public approval, they spend a good deal of their time explaining to politicians and public why ports and trains and all the myriad projects that advance or maintain movement matter. As a result, for a “social group,” the LOLs have amassed considerable clout. It’s hard to go to a major transportation meeting or conference without bumping into a few of them—or hearing them mentioned and thanked by name by legislators or congressional committee chairmen, who had at one time or another turned to the LOLs to find the right data or the right experts or to drum up support for a highway project or port expansion or rail safety bill.
Their work has led to the near completion of a unified freight policy at the national and California state level—a means of prioritizing (and paying for) improvements that will have the most impact. They also were instrumental in the launch of Knatz’s last big project at the port before leaving her post23: revitalization of the Port of Los Angeles’s waterfront as a center of dining, shopping, and commerce, as it was in decades past. The plan includes Knatz’s legacy project, the $500 million port business and scientific research center called AltaSea. She believes this project may finally convince Los Angeles that it really is a port town and generate the innovations needed to solve the opposing problems of insufficient capacity and too much environmental impact. Knatz would have liked to have stayed on a few years longer to work on this under the new mayor, she says. But now her successors—Gene Seroka, the former shipping line executive now running the Port of Los Angeles, and Jon Slangerup, who ran Federal Express Canada before taking over the Port of Long Beach—are grappling with the overload caused by megaships and their mega-alliances on one side, while on the other, lawsuits and public opposition to building more rail yards and freeway capacity for freight moving in and out of the port. Communities that will have to live near any new infrastructure—and cope with the fumes, noise, and health effects—insist that they will withdraw their opposition only if the new trucks and trains, as well as the powerful machines and vehicles that load them, use clean, low-, and zero-emissions technology. The ports themselves are already making such a shift, but the private rail and trucking companies responsible for the logistics outside the ports’ gates say they can only clean up slowly because of the cost. And so the impasse continues.
Being part of the LOLs, hearing the diverse concerns of port workers, railroad leaders, activists, and shipping companies made clear to Knatz why the door-to-door machinery that ought to function as a seamless system so frequently succumbs to paralysis instead of building consensus when it comes to reducing overload. The absence of an overarching national strategy combines with lack of public understanding to create failure after failure. Traffic lane expansions that don’t fix car traffic are celebrated, funded, and built, even as highway connectors and new rail gateways that would reduce truck congestion and pollution are opposed and languish for decades. Auto safety recalls that save hundreds of lives on the road receive the highest priority, but fundamentally flawed system designs that kill tens of thousands of Americans every year are blandly accepted as the cost of doing business. Massive warehouse builders are courted and given tax breaks by communities eager for jobs and growth, and then those same communities complain when truck traffic and smog triples overnight. The costs of these disconnects have been ignored and papered over for decades, the LOLs say, but they are now reaching a critical mass. And nowhere is this more visible than at the ports.
There are the new, larger ships with cargo capability beyond even the massive Port of Los Angeles’s current capacity to handle—requiring yet more expansion and construction. There are the shipping line alliances that save the steamship companies money by pooling resources but throw everything else out of kilter because of the crazy mix of cargo stacked together on single ships. It’s as if Federal Express and UPS tossed all their stuff on a single truck to save money, then brought it all to a U.S. Postal Service warehouse to sort, where havoc predictably ensues. These changes have saved shipping lines fuel and money, but they have also created backlogs and congestion at ports worldwide, with port directors caught in the middle. Suddenly the natural allies of shipper and port are at odds, with no easy solution in sight. The rest of the transportation system has to suck it up and try to solve the problem the shipping lines created.
Then there is the melting Arctic that is beginning to alter long-established trade routes by opening once ice-clogged routes at the top of the world. In a few years, these new routes will send even more cargo streaming into the West Coast ports. Finally, there is the constant need to modernize and automate the movement of cargo from ship to shore and to and from the port, set against the need to keep peace with labor forces that can make or break a port’s rankings in the world.
Preparing for these threats and disruptions requires something else: getting public buy-in. Knatz had to grapple with public indifference and ignorance of how transportation works and why it matters—and how there’s more to the door-to-door world than long commutes and rush hour traffic. She realized just how fundamental and dangerous a problem she and every other port director faced early in her tenure when, during a hearing on the proposed expansion of a port terminal, a member of the public objected on the grounds that the project would generate more truck trips on already crowded freeways.
“Why do I need a port?” the woman asked. “I have Walmart.”
There were murmurs of agreement from an audience that felt that these trucks were indeed deplorable, their presence a barrier to the travels and commerce of “real people.” They had no idea that the two things were so intimately connected, Knatz realized then: how the shoes that woman was wearing were almost certainly made in China. Or that a majority of shoes from China moved through her port. Or that there was an entire web of connections, from a rail trans-loading terminal south of Los Angeles, to a freight yard outside Kansas City, to a truck depot in the heartland, all of which were absolutely critical in maintaining a world where an annoyed consumer can say, “I have Walmart.” Indeed, it was this woman’s consumer choices—and those of a couple hundred million more Americans like her—that drew the ships and trucks to the port in the first place. That woman, Knatz felt like blurting, wasn’t the victim. She was the cause.
“People just have no idea,” she said later. “They don’t make the connection.”