Has Putin become the only non-Marxist leader in the world as leftist bureaucracies take over the West?
 Seldom, if ever, have the world's trade lanes been so challenged by disparate geo-political factors. Some attribute this to the sheer obesity of complexity that has grown over the years while others see murky Svengali machinations of the regulatory Deep State at work that has made Russia's Vladimir Putin the only non-Marxist leader in the West today.
In shipping, the regulatory state has resulted larger but fewer ocean carriers. The top 20 carriers in 2010 were Maersk, Mediterranean Shipping Co, CMA CGM, Evergreen, Hapag-Lloyd, APL, CSAV, Cosco, Hanjin, CSCL, MOL, NYK, "K" Line, Yang Ming, Zim, HMM, PIL and UASC. Ten years later, the list shrank by eight down to Maersk, Mediterranean Shipping Co, CMA CGM, Evergreen, Hapag-Lloyd, Cosco, Hanjin, Yang Ming, Zim and HMM.
Accelerating this has been soaring regulatory compliance costs, illegalizing affordable options and driving smaller carriers out of business. White House press secretary Karine Jean-Pierre urged the press corps to "look at the economy differently" as if the need to import oil helped create a better world of progressive inter-dependence rather than one of patriarchal independence.
Two new trends in east-west trade lanes started 20 years ago with the 2002 west coast docker slowdown and lockout. That's when the US east coast Port of Savannah, Georgia, urged shippers with cargo bound for the eastern seaboard to avoid the west coast where it faced costly rail and road transport to eastern destinations. Keep it on the water, they urged, transit the Panama Canal and land cargo on the east coast where costly overland transport is shorter and cheaper.
A few years later, shippers from Singapore and points west, notably India, had the same idea, but in the other direction. They too would skip LA and Long Beach but go through the Suez Canal. Most of their cargo was EU-bound, but US-destined containers were dropped off mid-voyage at any number ports in the Red Sea and the Mediterranean and picked up again by ships with US east coast cargo. Cargo on the Asia-Europe trade lane via Suez, did not land cargo at Mediterranean ports, but instead unloaded at Le Havre, Antwerp, Rotterdam, Hamburg and Felixstowe in England where consumers and transport facilities are abundant.
Something of a Belle Epoch, which had reigned in Europe for a decade before the outbreak of war in 1914, came to an end in China with the ascension of Xi Jinping in 2012. The previous reign of Hu Jintao and Jiang Xiaoping, who ruled in the spirit of much-loved Deng Xiaoping, who famously said it was "glorious to be rich", captured the hearts and minds of China.
At first, the reign of Xi Jinping was hopeful. The Communist Party was still the spiritual head of the nation. Catholic Bishops still had been approved by the party, but there was a pro forma air about it all. The new regime's first shipping policy enjoyed a positive reception. It was Xi Jinping's Belt and Road Initiative, which mimicked Marco Polo's 13th century Silk Road from China. It was supposed to shore up infrastructure gaps, and soon came to encompass burgeoning e-commerce too.
By now, there were freight trains from China to Europe via Russia to Germany with deliveries to Spain and the UK. Other rail lines avoided Russia, with ferries across the Caspian Sea to Baku and on to Iran, Turkey and north to Hungary. Some dared to think - myself included - that the efficacy of commercial arbitration would even worm its way into to establishing rule of law and an independent judiciary to the full normalization of China.
But that was not to be. Instead, Xi Jinping had energized the Chinese Communist Party that clamped down on social media, incarcerated Uighur Muslims in re-education camps by the hundreds of thousands, and subjected the general population to "social credit" scores, and having them refused bus, train and plane tickets if they had not paid their bills.
Such methods were re-doubled in the Covid crisis, which held much of the world in its thrall for three years. In China, it featured mass house arrests to achieve its zero-Covid policy. That's when it began to look as if the West was little better than China when it came to erasing civil rights and taking extreme measures, when the casualty rate seemed no worse than the 2009 SARS epidemic.
In China an entire port was shut down when a crane driver got the flu. Such shutdowns of factories, warehouses and railyards would occur from time to time. No one knew when, where and for how long the bureaucracy would strike.
In shipping terms, supply chains maximized effort, which resulted in a worldwide cargo stampede, massive congestion and huge profits for ocean carriers.
Since the Covid scare faded, western bureaucrats have made every effort to restore their power with a "climate emergency". But it didn't take. Now bureaucratic hopes are pinned on a war against Russia, which is clearly more popular with the governors than the governed.
Despite battlefield reports that are uselessly vague, no information is provided beyond artillery strikes. Thus, we have Russians consolidating along Ukraine's eastern border, swinging west along the Black Sea and the Crimea with Ukrainians making fitful attacks over fields laced with landmines a meter apart.
Enter China. China has come up with a peace plan that pleases no one. It shows goodwill despite its refusal to condemn Russia for the invasion. Russia also has a gas pipeline to China and has splashed out on a new fleet of oil tankers that will undermine western sanctions against Russian oil sales as it becomes a re-exporter of Russian oil.
While this is happening, Xi Jinping's China appears to be the throes of a bureaucratic gridlock of its own, with officials from top to bottom fearing loss of jobs, doing as little as possible to avoid blame in what is said to be a short-tempered sycophantic regime.
This combined with a general western commercial decoupling as firms seek to do business elsewhere lest finger-wagging social justice warriors accuse them of using slave labor to make sneakers.
Against the backdrop of these interconnected geo-political factors, is the titanic battle between right and left in the western world itself. Some see a dichotomy between men and women here, a desire to erase or minimize the difference between the sexes through regulation.
But there are political changes in the offing with the coming of US and French presidential elections. While Conservatives are nominally in charge in the UK they are for the most part tofu Tories served by a bureaucracy loyal to the regulatory state with a will to fail to make Brexit work. With Trump coming on like gang busters, and with Ron DeSantis and Vivek Ramaswamy being decent pinch hitters, should Trump strike out, and Marine Le Pen looking good to unseat Macron in France, it is an environment that also bodes well for Pierre Poilievre's Conservatives to toss Trudeau out of office in Canada.
As far as world shipping goes, Chinese cargo volumes will undoubtedly decline - Hong Kong plunged 24 per cent in June, but rise elsewere. Unlike the US, which is completely self-sufficient. This is not the case with China whose natural resources are meager given its enormous population and ambitions to shine in the front ranks of the developed world. |
