Introduction

Chuin Wei Yap:

Good morning, everyone, and good evening in Washington, DC, where it's Thursday. Good evening. I'm Chuin Wei Yap. I'm a research director with the Hinrich Foundation. I have the pleasure of having Marc Levinson, author, historian, and economist with us today for another instalment of our Hinrich Foundation Trade Book Talks.

I should start with an introduction to the foundation itself, which is a philanthropy dedicated to the mission of advancing sustainable global trade. It has two programs, one of which is education, which funds scholarships related to trade, master's and above, and alumni networks; and the research program, which furthers thought leadership and strategic partnerships in the cause of advancing global trade with organizations such as the WTO and the OECD.

And we have a readership base that includes USTR, Commerce, and China MoFCOM, and so on. This series of great book talks is a collaboration between the education and research programs of the foundation. And we hope you'll enjoy this one, which focuses on the body of work that Marc has done over his long career, which began incidentally as a journalist, which is something that Marc and I share.

I was at the Wall Street Journal, and he was at The Economist, I think, was the last posting. He had the wisdom to get out of it probably a little bit earlier than I did, and then went on to the Council of Foreign Relations and a series of seven books, perhaps the most celebrated of which is The Box, which is now, I think, almost 20 years old. That's it. Oh..

Marc Levinson:

That's correct.

Chuin Wei Yap:

Marc, yeah, which is remarkable. And the book in itself was remarkable in its own right when it came out because it was one of the first books to take one aspect, one innocuous aspect of global trade, and tell a story about it and its formation as a microcosm of the huge networks of standards and rules. And, as we see now, this sort of geopolitical struggle that has emerged over those underpinnings.

He's followed it up with a series of other books, including Outside the Box, which is about globalization, which is something that is not so much about the nuts and bolts of trade, but really about international relations, which is in contrast to The Box. I mean, one thing that struck me about The Box, Marc, was always that I think it began in 1956 in the narrative, and it was just remarkable how little of commerce at the time was international.

And by the time we got to Outside the Box, it was a book that was entirely about the international aspect of commerce, which now dominates our headlines anyway, and it's a little bit hard for this conversation to not comment as well on those developments.But before we start, I just welcome everyone who has signed in from all over the world to join us this morning/evening.

And to remind them that you can always send in comments, questions, vitriol, and invective through our chat function, which you'll see somewhere at the bottom of the Zoom screen. Before I go on, I'll just turn it over to Marc to do a little self-introduction, and then we'll pivot right into the subjects that we talked about.

Big Idea & Origin Story

Marc Levinson:	Well, thank you very much. I really appreciate it, Chuin Wei. Yes, I'm an economist and historian. I live in Washington, DC. My journalism days are long over. I've also worked as an economist and worked in the US government. These days, I just devote myself to writing articles and books and trying to improve my golf game. So I've been interested in international trade, and I actually came to containerization and shipping really from the trade side rather than the maritime side. I have a rather different perspective on how to interpret...
Chuin Wei Yap:	Explain the distinction between that trade side rather than the [maritime] side.
Marc Levinson:	Well, sure. My interest is international commerce and the flow of trade and international finance and those sorts of things. There are some people who are interested in ships. They collect models of ships. They know the details of ships and all of the companies that have run the ships. That's their fascination, and that's really maritime history—that's really not my orientation. I got into The Box because I thought there was a need for some exploration of why it was that international trade had grown so rapidly, even at times when the world economy was not growing rapidly. And that really had something to do with transportation becoming much cheaper and much more reliable. .
Chuin Wei Yap:	Yeah, some of which was due—well, a lot of which was due to the box, the container. It's interesting to—I mean, I absolutely agree with you, and I guess that's where your thinking, your background, your outlook coincides with ours, because we also come at international trade from, you know, I guess the best way to put it is the intellectual underpinnings of it. But it's remarkable that Outside the Box also has, I think it opens with a very vivid description of a Maersk vessel, I think at the time the largest that was launched, if I'm not wrong. And when you describe those ships—well, first of all, when you see those ships up close, it's remarkable.I mean, these are—well, I used to work for a while at Straits Times, and I used to row when I could in the mornings in a little canoe. And sometimes I would just wander next to very large ships on the harbor, and I would look up, and it was just amazing. I mean, it was like a skyscraper. But before we get there, it's also remarkable that Outside the Box actually expands into that corner of globalization where it provides a lot of the backdrop of what the box had both facilitated and, in a way, produced the tensions that we now live with. And one of the questions that you pose in the book obliquely is the question of whether it's over. You marked out three epochs of globalization—first, second, and third—and I think if I didn't get it wrong, your third epoch ended circa 2009-ish, after which it was a much more... it's where we are now. I mean, we've sort of come to an apogee of that ambivalence. Were we ever by nature, you know, a species that is made for globalization?
Marc Levinson:	Yes. Well, first off, I wrote Outside the Box because I was annoyed by a lot of very loose talk about globalization. People saying, "Oh, there's nothing new here, globalization's been around forever." And I think that that's actually not true, and that there have been material ways that international commerce has changed, not only in volume, but in the type of stuff that's traded internationally. And in particular, the big change that came along with containerization—and this is going to be no news to you—is all of this growth in trade and intermediate goods. Supply chains like this just did not exist before the 1980s. And they are really a manifestation of a very different type of trade relationship than we had earlier. Now, is globalization dead? That's what people are asking glibly today. And I don't think so. I think we are seeing that some folks who viewed the world as a stateless place have been shown to be wrong. It's not like borders don't matter. I think one reason for that is that people like to belong to something. People want to feel a part of something, and the world isn't a small enough something. People want to be part of a nation. People want to be part of a society. And the folks who thought you could just erase borders and have everybody living in a big, happy world, I think, were wrong on that score. So, in that sense, no, we're probably not made for globalization, at least not the borderless variety. I think one of the pressing—
Chuin Wei Yap:	You had a great anecdote about your daughter.
Marc Levinson:	Yeah, I think one of the pressing questions here—and I don't want to play sociologist, which I'm not—but how do you get the benefits of globalization without making people feel detached from their roots, not taking away this feeling that they have a home and a country and a place that's theirs? My daughter is a football fan—soccer, as we say in the States. And she's a big fan of Arsenal, which as some of you may know has valiantly tried, but failed to win the Premier League for a good number of years. And I made the suggestion to her a few years ago that it would be much cheaper for her to become an Aston Villa fan. She could get all of the football kit at much lower cost. She didn't particularly like that idea. She wanted to belong to a group of Arsenal fans. And the rational economic argument that this other team is cheaper does not win the day. And I just use that as a very small example of people's desire to be part of something small as well as part of something big. They want to have a group that they're in some way affiliated with, and a nation that they're in some way affiliated with. That's got to be part of globalization.
Chuin Wei Yap:	Right. Something about the shared values of... I suppose it's been described in the past as something tribal—probably the wrong word. But it's interesting, the parallel between the nation-state and a soccer fan club. And I think in many ways, what we're seeing today is a manifestation of that. And we had framed this book talk as a discussion about a collision between geopolitics and shipping. I think, you know, it's obvious looking at the headlines that it's become a very apt subject these days.

The Solitary Craft of Writing

Chuin Wei Yap:

Before we get there though, I wanted to talk to you a little bit about the creative process because you are now an author of seven books, and that is versus my zero. And, you know, The Box and Outside the Box are probably the most celebrated among them. And I recall that when you open The Box, you open it with a description of how it just came to you that you were going to write it, but you told some people about it, and then you got really fed up because people would be coming to you with questions and ideas.

And after a while, you just got so fed up of talking about that, that you just went off, and you said something really striking that stayed with me for a long time, which is that writing is a solitary venture. Talk a little bit about that process.

Marc Levinson:

Well, first, I guess I would say—and Chuin Wei, you know this from your own background as a journalist—that everyone who writes has his or her own way of doing it. And so I don't, for a moment, purport to suggest that there's a best way to do it or a correct way to do it. It's very idiosyncratic, and so people who write find the best way to do it. I tend to work in a very linear fashion.

I start at the beginning and work my way through the story. So while I have a general outline, things develop as the story moves along and as I learn more about it. Not everybody does it that way. This means that it's tough for me to work on more than one book at once because I'm wanting to march through one before I move on to something else, whereas other people can juggle multiples. So it's just a very individual sort of thing.

I typically will spend time sitting in front of my computer writing, and I'll work out a paragraph, I'll work out a page, I'll work out a chapter, and then work on it some more before I move on to the next one. So I tend to edit myself rather extensively, day by day. And again, that's not necessarily the practice of everybody else who writes books. It's really, really very individual.

The Complexities of Standardization

Chuin Wei Yap:	Yeah, your first was, you were just telling me, After Reagan. That was your very first, right? Absolutely. That's what I've always... you know, but we're journalists. Exactly. Yeah, yeah, that's an axiom that I live by. People relate to people. People want to read about people. They want to see themselves in others, and whether there are differences or their similarities, I imagine you still get questions about The Box these days. I think we were discussing some of them. Some of them relate to standards. I think you were telling me about a bunch of very disparate and very interesting crowds that you've spoken with in relation to The Box about, well, how do you relate that to the modern evolution of trade standards?
Marc Levinson:	Marc Levinson: Right, and that was just a more standard policy book, which had, you know, relatively small readership. But in my books since then, I've devoted a lot of effort to developing anecdote because, frankly, readers relate to people. When you can tell a story through people—humanize a story—it makes it much more interesting to people, and so I concentrate on that. Yes, I still get a lot of questions about The Box. I was at a meeting earlier this evening and someone I had never met came over and introduced himself to me and told me that he had read The Box 10 years ago in graduate school. That happens fairly frequently. And I've found that a couple of the aspects... well, people are certainly interested in international trade and shipping, no question about that, but a couple of the things in The Box have become really very interesting to people with no connection to trade or shipping. One is that I have a chapter on standards: the negotiations first in the United States in the 1950s and then internationally in the early 1960s about how long a container should be, how wide it should be, where the doors should be, where the inside interior supports should be, and so on. And those negotiations really went on for about 10 years after the first modern container voyage in 1956, before agreement was reached on what we know today as the standard 40-foot container. It turns out that there are a lot of different industries for which standardization is a big issue. The space industry, for example: is it possible to standardize the dimensions of rockets so that one could build satellites that could go up in any rocket? Is it possible to standardize the way geospatial data is presented? Yes, yes. And in the shipping industry, those who are engaged in the industry are aware of this, but there's been a lot of discussion in the logistics industry in recent years about the flow of data through supply chains so that shippers can know where their cargo is at all times, and what temperature it is, and when it's going to arrive, and whether anyone's tampered with it, and so on and so on. And there has been some progress made here, but there has not been as much progress as people had hoped in standardizing the way that this data is presented and recorded. There's a lot of discussion about how do you standardize data related to supply chains, and that's an ongoing process. People keep looking to the standardization of the container itself, and it turns out that it was a lot simpler to standardize that than to standardize data flows. There were fewer countries involved at the time, which is one reason for that, obviously. But also, in the case of the shipping container, there was a lot of pressure from the US Navy to come up with a standard, and the Navy basically told the private sector—the steamship companies, and the railroad companies, and the container manufacturers—"You guys agree on a standard, or we'll find one for you." And that sort of forced the private sector to agree on a standard. And there really is not that kind of pressure when it comes to, say, the flow of information. There's not pressure for a single standard governing the way information is presented and transmitted.
Chuin Wei Yap:	Yeah, I recall that somewhere in the 10 years of negotiations that produced the container was a very teething conversation, and this was just domestically within the U.S., about the corners of the container and the load, therefore, that it can bear, and even that took, I would recall, about months to sort out. And it was only sorted out because I think one party just went ahead and did it without any consensus. And now, pivoting to the standards of the space industry—really interesting, because we've commissioned a series on the space trade, which is a really emerging sector that has not been explored enough. But certainly in digital policy, you see that as well. The number of countries now involved, it seems to me that the discussion about standards, which already, as you documented in The Box, took 10 years, becomes hugely more difficult with the number of countries that are involved, especially with the two largest at odds over a lot of security issues that now permeate the discussion that we were having about whether we are a species that are inherently made for globalization. As I said at the start of this conversation, it's going to be very hard for us not to talk about all this in the context of what's happening today—Hormuz being the leading example. So when you talk about your books these days with these readers and these corporates that still come to you and ask you these questions about standards, what comes to mind? I think one of the things that you had mentioned was that we take maritime trade for granted these days, but what do you think?
Marc Levinson:	I think this takes a lot of patience and a lot of pushing to achieve these standards, and I don't think that's a problem unique to the standards for shipping and supply chains. You have many, many players in the official sector, many countries. When the standards were reached on container size and so forth, it was basically the US, Canada, Japan, and Europe at the bargaining table at the International Organization for Standardization. And now you'd probably have 150 countries at the bargaining table, and it's really hard to reach agreement about much of anything with 150 parties. And then, of course, you have the individual parties trying to protect their own interests. I think where this may eventually go is that you will see certain powerful parties—and those may well be corporations rather than governments—that end up insisting that their standards be put in place for commerce affecting them, okay? And if that happens to be a very large company, a very large shipper, a very large transportation company, maybe those standards will be adopted by others because they want to continue to do business with that entity. And that's really one way to make standards bite, but it's going to be very hard to have them adopted universally. People are trying very hard, no doubt about it, but it's tough.
Chuin Wei Yap:	Yep. You know, yeah, the shipping industry is one that is notoriously resistant to going paperless. Governments have been all over the world, including in Singapore, the largest transshipment hub in the world, and it remains that way. I mean, bills of lading, you know, it still is very much a paper protocol, okay. And that's in contrast to, say, digital where companies are very much engaged in the attempt to craft policy. Increasingly, you find that governments are getting much more involved, are trying to set the pace, but it's not working out that well. I mean, we talked about attempts to block Chinese-built ships from global commerce, control of port terminals on a governmental basis. Is there a disjunction between policy goals here in the international conversation versus what the corporates, what the companies want?
Marc Levinson:	With respect to standards in particular?
Chuin Wei Yap:	So both with respect to—yeah, I mean, that's where I began the question.
Marc Levinson:	Let me point out a couple of things about the complexity of the industry that might help explain that. One is that you've got an enormous number of companies or entities that are involved in one way or another in the logistics industry. Some of them are dealing with very high-value merchandise, and they don't really care so much about costs. Others are dealing with much lower-value merchandise, and things that change cost structures are very important to them. So for example, if we're having standards that are going to raise the cost of a shipping container—if we're going to require that every shipping container have smartness in it, have digital capability embedded in the container—well, who's going to pay for that? If it's a pharmaceutical manufacturer shipping in that container, no problem. If it is an exporter of hay, which is one of the big things the United States exports in containers, that's going to be a problem. It's not worth the money to have smartness on a container that holds a product that does not have a lot of value per cubic meter. So, there are differences within the shipper community as to what is of value. And a lot of what is happening with digitization, or digitalization, as they call it in the shipping industry, has the potential to raise fixed costs. There's a potential for increased automation in ports, increased information technology in ports, and that is a fixed capital investment, effectively. If you're running a container terminal, you've got to make the payments to keep your systems in operation and up to date. And if your business isn't so strong, then that fixed cost will be a burden. So, there are reasons why various entities are not on the same wavelength when it comes to making a seamless system for communications and management of information flows.
Chuin Wei Yap:	Yeah. What would you recommend to policymakers in terms of breaking that mode, particularly when it comes to paperless?
Marc Levinson:	Well, some parts of it, I think, are fairly easy to break; others not. And I think it's worth considering how much standardization is really necessary and desirable. I will give you an example going back to the humble shipping container. Yes, there was agreement on the width of the standard container. Yes, there was agreement on the length of the standard container. There was also agreement, back in the '60s, on the height of the standard container, and it turned out that that really wasn't necessary, okay? It was possible for ship lines and railroads and trucking carriers and cranes in container terminals to handle containers of multiple or various heights. So, unlike width, which had to be agreed on—there had to be a uniform standard—there didn't really have to be a uniform standard for height. And there may be a lot of different standards where it's actually not that important to have uniformity. So, I think it's useful to think about what really has to be standardized and what isn't so essential to be standardized.
Chuin Wei Yap:	Yeah, yeah, that was the bit about the corners because it related to the heights, if I recall, and that was when...
Marc Levinson:	It related to the ability of any container crane in the world to handle a container, and so that was something that was important to standardize. But there are other aspects of it that matter less. Is it essential that the floor of a container be standardized? Perhaps not.

Plurilateral Deals and the WTO Crisis

Chuin Wei Yap:	Yeah. So a lot of it is actually government getting out of the way. It helped, of course, that the U.S. Navy made that sort of quasi-threat. A lot of it comes down to, I mean, at least in the international venue these days, particularly with that recent conclusion of the WTO ministerial, which our chairman described as "not even a respectable near-miss," and I completely agree with it. International trade rulemaking these days—whether it's multilateral, bilateral, or plurilateral, which I know is a term you don't particularly like, and I tend to agree with you on that as well—has the system just fallen apart in your view, and what might come after?
Marc Levinson:	Parts of the system have fallen apart; parts of the system are still in place, and I think we're seeing that national governments are struggling to figure out what should come next. We're seeing right now, really, a plethora of trade agreements between two governments, between a small community of governments, continent-wide in some cases. I think the idea that the World Trade Organization with 166 members is going to come back and be a significant force in trade policy looks improbable at this point, and so countries are grasping for solutions. F quite one-sided. The United States makes a commitment to lower tariffs, probably the tariffs that were imposed last year, and in return, it expects a large number of commitments from its trading partner. So it's not like, "Oh, I'll give you one, and you give me one." It's much more like, "We'll reduce the tariffs, and you'll do this and that and the other thing." The United States, for example, has an agreement with Argentina—37 pages—which starts out with the United States agreeing to lower its tariffs on Argentina. The United States also promises not to impose duties on electronic data transmissions. And that's about all the United States promises in this 37-page agreement, in which the phrase "Argentina shall..." appears 113 times. It's quite an unbalanced agreement in that way. And of course, that raises the question of how long this sort of agreement is likely to survive. Will internal political forces eventually ask questions of the government in Argentina: "Is this a fair deal? Should we have done this?
Chuin Wei Yap:	Yep.
Marc Levinson:	And you see much the same thing in the agreements with other countries. Indonesia signed an agreement with the United States—okay, it agreed that it would not conduct additional safety checks on imports of U.S. dairy products. The United States didn't make any such commitment with regard to Indonesia; it's a one-way commitment. Indonesia agreed to purchase at least 163,000 metric tons of US cotton every year. The US didn't agree to purchase anything from Indonesia. So again, how is this going to look in terms of domestic politics in Indonesia? Are people going to raise the question of whether this is really a fair deal? And if those questions are raised in various countries, then these agreements may not have a real long lifetime.
Chuin Wei Yap	Yap: Yeah, we are actually about to publish a paper precisely on this issue when it comes to Indonesia on Tuesday with Derek Grossman, who's a fellow at Southeast Asian studies here, where, you know, he makes the same comparison you do, which is remarkable. He said the term "Indonesia shall" appears 200 times in the agreement, and the term "the United States shall" appears 9 times in the agreement. A lot of it was agricultural concessions, as you pointed out. I don't know whether they've taken into account the GMO component of it. But he also makes the point that a lot of it actually makes sense for the Indonesian economy in terms of what it can't produce for itself, or it can't get its act together to produce enough of for its own poultry and instant noodle industries. But the political cost that it incurs for Prabowo at home having to explain... and he's getting a lot of flack for it in terms of the concessions that he appears to have given. It necessarily was a pivot away from over-dependence on China, which also makes some strategic sense for Indonesia, but similarly, I mean, it's such a parallel—it's such a good parallel with the one that you raised with Argentina. Whether or not those succeed, they depend to some extent on dispute settlement, right? A lot of it is still missing that component, and one way or the other, bilateral or plurilateral, you still have to solve this issue of dispute settlement, which is a bit of a crux. I think you've pointed that out as well. What is the problem there?
Marc Levinson:	Well, the problem is simple enough: national governments don't like to be told what to do. And I think we saw the World Trade Organization really face a crisis, okay? The United States, by the way, was the party back when the WTO was formed 30 years ago that wanted a judicial-type arrangement in the WTO. It wanted the WTO to be the arbiter of whether trading policies of a given country were fair or unfair. It wanted countries to bring cases against one another alleging unfair trade and have them adjudicated in a formal setting. Well, the United States liked it until it found itself as the accused party, at which point it decided maybe this was not such a terrific system. And I think most countries feel the same way. They really don't like a bunch of judges in some international organization telling them that their trade policies are legal or not legal. So, how do you resolve this when country A claims that country B is unfairly subsidizing its exports? In a two-party arrangement, well, if you can't work out something, you just terminate the agreement. This is not all that complicated, and maybe it can be resolved by conventional diplomacy. But when it gets to be a larger arrangement, such as the CPTPP agreement in the Pacific, you've got a whole bunch of countries there, and if there are complaints that a country isn't living up to its obligations, how is that going to be adjudicated? How can that country really be forced to do something that it's chosen not to do? Is it going to be forced to disregard its own internal political dynamics? That hasn't been tested, but I think these kinds of arrangements are going to face the same issues that the WTO did in terms of the inability to enforce agreed-upon rules, just because that's the nature of international organizations.
Chuin Wei Yap:	Yeah, there's a gravitating toward the MPIA—you know, the Multi-Party Interim Appeal Arbitration Arrangement—that is trying to be a de facto dispute settlement mechanism. It actually, you know, with this EU CPTPP conversation with other efforts to evolve these regional slash plurilateral responses, there's some effort to think of it as the sort of de facto default mechanism that you turn to. There's this, it seems to me, an attempt to still retain that sheen of WTO slash multilateral branding. But that question, as you say, it really remains unanswered—the crux. And I suppose there are some really fine scholars, Joost Pauwelyn among them, who have always argued that the problem was that the judicial powers that were gifted to the WTO, actually by the United States, as you correctly pointed out, so that, by the way, it wouldn't need to use so much of Section 301, has turned the WTO into, you know, given them a view of itself as a supranational authority that can afford to be not cognizant of the political support, their needs. Do you have thoughts about this interaction between political input in terms of the legitimacy of such a dispute settlement system?
Marc Levinson:	I think on balance, all these agreements are a good thing, okay? Because they offer governments the opportunity to try and resolve trade issues in many different ways, okay? We're not necessarily bound to one model that encompasses 166 countries. If a group of countries want to get together and sign an agreement that covers these aspects of international trade, they can do it. And it might be less controversial because while these countries may not be in agreement on, say, how to handle subsidies to steelmakers, perhaps they're in agreement on how to handle trade in cotton and corn. And so it's possible that there are some smoother relationships here, and it does provide a way to address new issues in a smaller forum rather than trying to address them in a huge forum.But at the end of the day, the governments that participate are going to have to decide whether they want these agreements to survive and to flourish and to be meaningful. These are voluntary organizations. Countries have chosen to be in them. And of course, it's often the case that politicians back home are all too eager to point out the shortcomings. And so it's a question of leadership and willing to compromise with other countries and willing to, at times, pay a political price at home.
Chuin Wei Yap:	One of the issues you've pointed out is speed, right? The speed of the settlement is key. You know, I mean, you and I both know civil lawsuits if we were to follow it, and someone said it takes years. How do you solve the issue of speed? I mean, that was one of the issues that bedeviled that rare earths challenge, because by the time the WTO got to giving the US, Japan, and the EU what they wanted, it was too late. I mean, China sort of accomplished its geopolitical goal. What's the point?
Marc Levinson:	Yes. I think this was an issue very much related to the rise of China as a manufacturing power. You started having complaints about this export from China causing injury here, or being unfairly subsidized there, or whatever the story was. And China was growing very quickly, its exports were growing very quickly, it was moving into new product exports very quickly, and the legal system, both nationally in many countries and at the WTO, was just lagging behind. So by the time the complaint was adjudicated, it was really no longer relevant. And I think that any effective dispute resolution system is going to have to be able to make decisions more quickly, reach at least temporary conclusions more quickly. Whether governments are willing to tolerate that, again, this is really a political question. The WTO was designed as an organization with a weak secretariat, okay? There's not a WTO boss who's in a position to say, "We have to do this, we are obligated to do this." It's just a matter of persuading countries that it's in their own interest to compromise, that they may lose some cases, but they may win some cases, and they need to stick with it in order to obtain the much larger advantage of increased international trade.
Chuin Wei Yap:	Yeah, yeah, it's interesting. Bob Lighthizer had a piece out, I think a couple of days ago, a day and a half ago, in Foreign Affairs where he talks about this redesign of the international trading system. He highlights right at the end the cooperation issue—the international cooperation issue—which is unusual. But I want to circle back to this point on the stress in the global trading system, maybe again toward the end as we come up to the hour.

Dark Fleets, China, and Future Projects

Chuin Wei Yap:	But before that, I wanted to ask you, how has the shipping industry changed when you've got a problem with dark fleets? The rising... you described it as a port state entity. Has it... I mean, one of the things that you've also talked about is standards for seafarers. Yeah, how have these affected the shipping industry?
Marc Levinson:	Well, you know, one of the reasons that international trade thrived for so many years is that shipping was extremely cheap. And one reason shipping was cheap, obviously, was that the vessels themselves were subsidized, but also many ship lines were able to transfer the ownership of these vessels to countries with very favorable terms or to register them in countries that had weak regulation. Countries in which they were allowed to hire cheap labor from any place in the world and perhaps not treat it very well; countries that maybe did not enforce safety standards or environmental standards. And I think in recent years, there's generally been some tightening of this, which is probably a good thing for the world. It may mean somewhat higher costs for shippers, but a lot of the states that were formerly regarded as "flags of convenience"—that's a term that was coined by the transport unions—actually have cracked down a bit on the steamship lines that are registered in their country, have actually enforced rules. And there have been more international rules that have been accepted by these countries over things like non-polluting or low-sulfur fuel usage as an example, or the pay standards for seafarers, or many, many other topics. So I think there's been a lot of progress here.But there are still a lot of things that haven't been ironed out. I think one of the most important developments is that the states with major ports have had a much stronger role in enforcing these standards, okay? It's no longer the case that a ship with any registration, and any crew, and any propulsion system can just show up at a port in any country, and load or unload, and then sail away again. The port state is now going to ask for a safety inspection. The port state is going to ask for proof that the seafarers have been paid. The port state might take a look at the oil in the tank and make sure that it's really low-sulfur fuel. So there's been, I think, some improvement in the standards because of that, but it also then complicates life a little bit for shippers by raising costs.Now, what we've seen with the dark fleet is, in a sense, a reversion to the old notion of flags of convenience. These are ships that have no legal registry in many cases. They claim to be registered in a country that doesn't register ships or in a country that doesn't have anyone enforcing rules. They don't adhere to international rules. They may not carry insurance. They may not have safety inspections. Who knows whether they actually pay the seafarers? And so, dealing with these vessels has obviously become a major problem. And we'll have to see whether this is a problem that goes away once Russia's war in Ukraine is resolved.
Chuin Wei Yap:	Yap: Well, increasingly looking at what's happening in Hormuz and now the sudden spate of questions that has emerged over the Strait of Malacca as a result. I mean, just for background, Marc, you would know this: that's a strait that goes between the western coast of Peninsula Malaysia and Sumatra in Indonesia, narrows down and funnels toward the Singapore Strait, carries about 70% of the world's maritime global seaborne oil. And in the last week and a half, I think it spilled into public, this indecision about whether or not tolls might be imposed, with Indonesia and Malaysia sort of floating that. I think Indonesia at one point said that, "Well, you know, we would consider it," and then walked it back within hours because the free passage of that strait has always been for decades underpinned, by the way, with the backing of the US 7th Fleet, a really key aspect of international commerce. Now, three countries, Strait of Malacca, couldn't quite get it together on the Dark Fleet in terms of these inspections. Part of the reason is because these ships tend to sail right at the edge of the EEZs. I mean, are you optimistic about the governance issues?
Marc Levinson:	You know, I think you see a lot of differentiation in different parts of the shipping industry here, okay? You know, the containers typically move on a handful of very large carriers very well-known, very well-established and the carriers are very exposed to the concerns of their very powerful customers, okay? Large multinational manufacturing corporations, the big retailers. So there's a lot of discipline in that part of the industry, and they're going to obey the rules. No retailer wants to be in the news because it shipped its goods aboard a carrier that failed to pay its merchant seafarers. So there's some discipline built into the system. It's a bit different if you're talking about the oil trade, for example, or perhaps parts of the livestock trade, where you're dealing with parties who are not necessarily well-known, and maybe not well-capitalized, and may not much care about public opinion, and the pressures are different. So it's hard to see how that works out. I doubt we're going to get into a situation in which everybody charges tolls. I think that's probably going to go away pretty quickly.
Chuin Wei Yap:	Yeah, and ultimately what happens there at its root has a U.S.-China dynamic behind it. And I think we talked a little bit about the role of the U.S. and the emerging and very consequential role of China. And you see China sort of recognizing this as well. I know your overall sense is that you do not see China as a threat behind every tree, as you put it, but you also see some grounds for critique of China's role now in the international trading system. Do you want to talk a little bit about that? Yeah, and we're going to see another we are seeing another China export surge. It's a politically difficult question for them as well; the levers that they have for still consumption at home are fairly limited. We've had other book talks that have addressed those issues. We're coming up on the hour. We do have a question from the audience: they want to know what your next book is about. Have you given that any thought?
Marc Levinson:	Sure. China wants to be a leader in the system, and it should be a leader in the system. It's a very large and increasingly wealthy country, and it obviously is the major manufacturing country in the world at this point. You know, part of leadership is that it's going to have to take some measures to keep the system functioning. And I think one of those is to deal with its surplus in goods trade. It's got an enormous goods trade surplus at the expense of many other countries, and those other countries regard this as unfair for obvious reasons. And so I think the Chinese government needs to find ways to deal with this, or else it's going to be very hard to sustain an open trading system that encompasses as many countries as it probably should. Yes, I have a book that will be published this autumn, and it is a biography. I've never done a biography, and I wanted to do one. So this is a biography of James E. Casey, who founded the company that became United Parcel Service back in 1907, and was involved with the company as the CEO for 55 years, and was involved with the company as a CEO and then as a director for 76 years. So he really had a major hand in the growth of modern globalization by developing a company that's really so critical to the modern world economy. He was a man who was very imaginative, very determined, and totally obsessed with parcels. So he makes an unusual subject for a biography, but you'll be able to read more about him coming this autumn.
Chuin Wei Yap:	Yeah, I see that... fortunately, he passed away in 1983. I'd be very curious what he thinks about de minimis and the treatment of de minimis. What do you think he would think?
Marc Levinson:	You know, I think he would have looked at it from the point of view of what his company needed to do to adapt, okay? He would have said, "This is starting to happen. Are we doing the right things to attract this business? And if not, we'd better do them quickly." He was a man who turned around his company several times to keep it on the leading edge of a fairly boring industry. Parcel transportation was not an exciting industry, and he was constantly pushing new ideas and watching out for the competition, because "you don't think it's there, and it's going to kill you."
Chuin Wei Yap:	Yeah. Well, I can't wait to read it. Do you have a date of release? Oh, fantastic. Congratulations, Marc. I'm looking forward to getting it. I'll probably get it on Kindle. But thank you so much, it's been such a pleasure chatting with you today. Marc and I have been in touch now for, I think, about two, three years. I've always enjoyed every conversation with you, and it's such a privilege having an insight into what you think about the state of the world today in terms of trade. So thank you.
Marc Levinson	It'll be released in October. Well, Chuin Wei, thank you very much. It's great to talk with you. I think the Hinrich Foundation is doing great work, and I'm glad to be on your show.
Chuin Wei Yap	Thank you. And thank you to everyone who joined us this evening.