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vessels that no other company wanted; 16 months later, the ships were sold to Sea-Land for 28 cents on the dollar. More than 10,000 containers and 5,500 chassis were dumped back on Flexivan Leasing, which had been renting them to U.S. Lines for a few dollars a day. U.S. Lines’ $12 million annual lease for its new container terminal on Staten Island was annulled, leaving the Port Authority of New York and New Jersey liable for $60 million of dredging and construction work. First Colony Farms passed into the hands of its bankers, much of it to end up as a wildlife refuge. Unsecured creditors, who were owed $260 million, came away with almost nothing. Malcom McLean’s shareholding, representing 88 percent of McLean Industries’ common stock, was wiped out, and he and his son Malcom McLean Jr., a vice president, were ejected from the management. Thousands of people lost their jobs.23

“Malcom never got over the U.S. Lines bankruptcy,” a longtime associate said later. He went into seclusion, shunning journalists and avoiding public appearances. His failure followed him, the knowledge that he had hurt thousands of people a constant source of shame. Yet he still was a driven man. In 1991, five years after the failure of U.S. Lines, sheer boredom led him to launch yet another shipping company at the age of seventy-seven. Former Sea-Land executives, many of them now among the shipping industry’s leading lights, prevailed upon him to return at least occasionally to public view, to accept the awards and honors that were his due. On the morning of his funeral, May 30, 2001, containerships around the world sounded their whistles in his memory.24

Yet if the failure of United States Lines was a personal disaster for many, it was far from a catastrophe for the industry Malcom McLean had created. By 1986, the year of U.S. Lines’ collapse, ports, transportation companies, and shippers around the world had invested $76 billion in order to carry freight in containers. Another $130 billion of outlays was forecast by the end of the twentieth century, on even bigger ships, ports that could turn a vessel inside of twelve hours, cranes that could move more than one box per minute. Container shipping was becoming a very big business, and as it grew, the cost of moving a containerload of cargo was steadily coming down.25

Chapter 13

The Shippers’ Revenge

Disappointing as they were for investors, the first years of international container shipping introduced an entirely new dynamism to the boring old business of moving freight. The decade-long rate war, as Karl Heinz Sager of the German carrier Hapag-Lloyd commented later, “entailed tremendous losses for shipowners, but it brought on the other hand the breakthrough of the ‘box’ with shippers.” The new container technology spread widely, and it would soon begin to penetrate deeply into the world economy.1

The initial effects of the container were felt mainly within the narrow confines of the maritime industry, by ship lines, port agencies, and dockworkers. Carriers staggered under the enormous costs of the transition to container shipping, and some did not survive it. Ports literally had to rebuild themselves to handle containers in quantity, taking on entirely new roles developing and financing terminals of previously unimagined scale. Longshoremen almost everywhere lost their jobs in large numbers, although in many cases their unions resisted strongly enough to win compensation for acceding to the changes that would quickly reshape work on the docks.

The sweeping changes within the maritime world initially had very few wider consequences. Ocean transportation itself accounted for only a very small share of the world economy, and, except in dockside communities, longshore work was a tiny percentage of total employment. The true importance of the revolution in freight transportation would be found not in its effect on ship lines and dockworkers, but later, as the impact of containerization resonated among the hundreds of thousands of factories and wholesalers and commodity traders and government